Federal Register Vol. 81, No.168,

Federal Register Volume 81, Issue 168 (August 30, 2016)

Page Range59421-59826
FR Document

81_FR_168
Current View
Page and SubjectPDF
81 FR 59698 - Sunshine Act MeetingPDF
81 FR 59421 - Women's Equality Day, 2016PDF
81 FR 59674 - In the Matter of MarilynJean Interactive Inc.; Order of Suspension of TradingPDF
81 FR 59659 - Sunshine Act Meeting NoticePDF
81 FR 59656 - Sunshine Act MeetingPDF
81 FR 59609 - Threat Reduction Advisory Committee; Notice of Closed Federal Advisory Committee MeetingPDF
81 FR 59732 - Agency Requests for Renewal of a Previously Approved Information Collection(s): Information To Determine Seamen's Reemployment Rights-National EmergencyPDF
81 FR 59731 - Request for Comments of a Previously Approved Information CollectionPDF
81 FR 59731 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel AFTER HOURS; Invitation for Public CommentsPDF
81 FR 59602 - Notice of Public Meetings of the Connecticut Advisory Committee To Plan Civil Rights ProjectPDF
81 FR 59601 - Notice of Public Meetings of the Vermont Advisory Committee To Plan Civil Rights ProjectPDF
81 FR 59601 - Notice of Public Meetings of the New York Advisory Committee To Plan Civil Rights ProjectPDF
81 FR 59600 - Notice of Public Meeting of the Michigan Advisory Committee for a Meeting To Discuss Approval of a Draft Committee Report Regarding Civil Rights and Civil Asset Forfeiture in the StatePDF
81 FR 59611 - Submission for OMB Review; Comment RequestPDF
81 FR 59733 - Submission for OMB Review; Comment RequestPDF
81 FR 59484 - Safety Zone; Caribbean Fantasy, Vessel on Fire; Punta Salinas, Toa Baja, Puerto RicoPDF
81 FR 59480 - Safety Zone; Chesapeake Bay, Hampton, VAPDF
81 FR 59622 - Meeting of the Mobile Sources Technical Review SubcommitteePDF
81 FR 59621 - Request for Nominations of Experts To Augment the Science Advisory Board Ecological Processes and Effects Committee To Provide Advice on Methods for Deriving Water Quality Criteria for the Protection of Aquatic LifePDF
81 FR 59712 - Reporting and Recordkeeping Requirements Under OMB ReviewPDF
81 FR 59503 - Maryland: Final Authorization of State Hazardous Waste Management Program RevisionsPDF
81 FR 59712 - Notice of National Grain Car Council MeetingPDF
81 FR 59517 - Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; 2016 Commercial Accountability Measures and Closure for Blueline Tilefish in the South Atlantic RegionPDF
81 FR 59730 - Petition for Waiver of CompliancePDF
81 FR 59729 - Petition for Waiver of CompliancePDF
81 FR 59730 - Notice of Application for Approval of Discontinuance or Modification of a Railroad Signal SystemPDF
81 FR 59603 - Foreign-Trade Zone (FTZ) 76-Bridgeport, Connecticut; Authorization of Production Activity; ASML US, Inc. (Optical, Metrology, and Lithography System Modules); Newtown and Wilton, ConnecticutPDF
81 FR 59594 - Maryland: Final Authorization of State Hazardous Waste Management Program RevisionsPDF
81 FR 59603 - Foreign-Trade Zone (FTZ) 26-Atlanta, Georgia; Authorization of Production Activity; Eastman Kodak Company; Subzone 26N (Aluminum Printing Plates); Columbus, GeorgiaPDF
81 FR 59602 - Approval of Subzone Status; Givaudan Flavors Corporation; East Hanover, New JerseyPDF
81 FR 59603 - Certain Oil Country Tubular Goods From the Republic of Korea: Notice of Court Decision Not in Harmony With Final DeterminationPDF
81 FR 59610 - Reserve Forces Policy Board; Notice of Federal Advisory Committee meetingPDF
81 FR 59642 - Findings of Research MisconductPDF
81 FR 59630 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
81 FR 59629 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
81 FR 59627 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
81 FR 59643 - Notice of Diabetes Mellitus Interagency Coordinating Committee MeetingPDF
81 FR 59593 - Periodic ReportingPDF
81 FR 59592 - Periodic ReportingPDF
81 FR 59613 - Submission for OMB Review; Comment RequestPDF
81 FR 59482 - Safety Zone; Dredging, Shark River, NJPDF
81 FR 59715 - Assumption of AuthoritiesPDF
81 FR 59653 - New Agency Information Collection for the Bureau of Indian Education Medication Authorization and Incident Report FormsPDF
81 FR 59440 - Commercial Space Transportation Reusable Launch Vehicle and Reentry Licensing Regulations; Technical AmendmentPDF
81 FR 59717 - Fixing America's Surface Transportation Act-Productive and Timely Expenditure of FundsPDF
81 FR 59438 - Licensing and Safety Requirements for Launch; Technical AmendmentPDF
81 FR 59713 - Petition for Exemption; Summary of Petition Received; Fusion Flight, LLCPDF
81 FR 59652 - Renewal of Agency Information Collection for Grazing PermitsPDF
81 FR 59612 - Government-Industry Advisory Panel; Notice of Federal Advisory Committee MeetingPDF
81 FR 59658 - Advisory Committee on the Medical Uses of Isotopes: Call for NominationsPDF
81 FR 59669 - Omaha Public Power District; Fort Calhoun Station, Unit No. 1PDF
81 FR 59521 - National Organic Program: Notice of Interim Instruction on Material ReviewPDF
81 FR 59425 - Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order; Revision of Time Frame for Continuance ReferendaPDF
81 FR 59670 - Exelon Generation Company, LLC; Calvert Cliffs Nuclear Power Plant, Units 1 and 2; Update Schedule for Updated Final Safety Analysis ReportPDF
81 FR 59436 - Notice of Revised Procedures Affecting Applications and Authorizations for the In-Transit Movement of Natural GasPDF
81 FR 59646 - 30-Day Notice of Proposed Information Collection: Budget-Neutral Demonstration Program for Energy and Water Conservation Improvements at Multifamily Housing Residential UnitsPDF
81 FR 59440 - Collection of DebtsPDF
81 FR 59647 - 30-Day Notice of Proposed Information Collection: Ginnie Mae Multiclass Securities Program Documents Forms and Electronic Data SubmissionsPDF
81 FR 59647 - 30-Day Notice of Proposed Information Collection: Multifamily Default Status ReportPDF
81 FR 59649 - 30-Day Notice of Proposed Information Collection: Application for Community Compass TA and Capacity Building Program NOFAPDF
81 FR 59712 - Federal Aviation Administration Commercial Space Transportation Advisory Committee-Public TeleconferencePDF
81 FR 59714 - Noise Exposure Map Notice for Baltimore/Washington International Thurgood Marshall Airport, Anne Arundel County, MarylandPDF
81 FR 59644 - Notice Announcing the Automated Commercial Environment (ACE) as the Sole CBP-Authorized Electronic Data Interchange (EDI) System for Processing Electronic Drawback and Duty Deferral Entry and Entry Summary FilingsPDF
81 FR 59713 - Waiver of Aeronautical Land-Use Assurance: Marshall Memorial Municipal Airport (MHL), Marshall, MOPDF
81 FR 59605 - Senior Executive Service Performance Review Board MembershipPDF
81 FR 59733 - Multiemployer Pension Plan Application To Reduce BenefitsPDF
81 FR 59734 - Multiemployer Pension Plan Application To Reduce BenefitsPDF
81 FR 59614 - Environmental Management Site-Specific Advisory Board, PortsmouthPDF
81 FR 59613 - Environmental Management Advisory BoardPDF
81 FR 59656 - Agency Information Collection Activities; Proposed eCollection eComments Requested; Extension of a Currently Approved Collection: National Drug Threat SurveyPDF
81 FR 59624 - Submission for OMB Review; Report of ShipmentPDF
81 FR 59728 - Qualification of Drivers; Exemption Applications; Diabetes MellitusPDF
81 FR 59726 - Qualification of Drivers; Exemption Applications; Diabetes MellitusPDF
81 FR 59723 - Qualification of Drivers; Exemption Applications; Diabetes MellitusPDF
81 FR 59640 - Voluntary Sodium Reduction Goals: Target Mean and Upper Bound Concentrations for Sodium in Commercially Processed, Packaged, and Prepared Foods; Draft Guidance for Industry; Extension of Comment PeriodsPDF
81 FR 59636 - Agency Information Collection Activities; Proposed Collection; Comment Request; Hazard Analysis and Critical Control Point Procedures for the Safe and Sanitary Processing and Importing of JuicePDF
81 FR 59633 - Bioequivalence Recommendations for Risperidone; Draft Guidance for Industry; AvailabilityPDF
81 FR 59718 - Qualification of Drivers; Exemption Applications; Diabetes MellitusPDF
81 FR 59725 - Qualification of Drivers; Exemption Applications; Diabetes MellitusPDF
81 FR 59657 - Agency Information Collection Activities; Proposed eCollection; eComments Requested; Requirement that Movie Theaters Provide Notice as to the Availability of Closed Movie Captioning and Audio DescriptionPDF
81 FR 59479 - Safety Zone; Delaware River, Philadelphia, PAPDF
81 FR 59624 - Formations of, Acquisitions by, and Mergers of Bank Holding CompaniesPDF
81 FR 59645 - Agency Information Collection Activities: Application for Travel Document, Form I-131; Extension, Without Change, of a Currently Approved CollectionPDF
81 FR 59644 - Chemical Transportation Advisory CommitteePDF
81 FR 59623 - Disability Advisory Committee; Announcement of Next MeetingPDF
81 FR 59624 - Notice to all Interested Parties of the Termination of the Receivership of 10505-GreenChoice Bank, FSB, Chicago, IllinoisPDF
81 FR 59437 - Releasing Information; Availability of Records of the Farm Credit System Insurance Corporation; Fees for Provision of InformationPDF
81 FR 59638 - Enforcement Policy on National Health Related Item Code and National Drug Code Numbers Assigned to Devices; Guidance for Industry and Food and Drug Administration Staff; AvailabilityPDF
81 FR 59639 - Antimicrobial Drugs Advisory Committee; Notice of MeetingPDF
81 FR 59635 - FDA Small Business and Industry Assistance Regulatory Education for Industry Fall ConferencePDF
81 FR 59634 - Vaccines and Related Biological Products Advisory Committee; Notice of MeetingPDF
81 FR 59628 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
81 FR 59626 - Advisory Committee to the Director (ACD), Centers for Disease Control and Prevention (CDC)PDF
81 FR 59627 - Request for Nominations of Candidates To Serve on the Advisory Committee on Breast Cancer in Young Women (ACBCYW)PDF
81 FR 59641 - Agency Information Collection Activities: Submission to OMB for Review and Approval; Public Comment Request; The Stem Cell Therapeutic Outcomes DatabasePDF
81 FR 59614 - Combined Notice of Filings #1PDF
81 FR 59618 - Transcontinental Gas Pipe Line Company, LLC; Notice of Intent To Prepare an Environmental Impact Statement for the Planned Northeast Supply Enhancement Project, Request for Comments on Environmental Issues, and Notice of Public Scoping SessionsPDF
81 FR 59617 - Notice of Commission Staff AttendancePDF
81 FR 59620 - C.P. Crane LLC; Notice of FilingPDF
81 FR 59615 - Gulf South Pipeline Company, LP; Notice of Intent To Prepare an Environmental Assessment for the Proposed St. Charles Parish Expansion Project and Request for Comments on Environmental IssuesPDF
81 FR 59617 - Combined Notice of Filings #2PDF
81 FR 59622 - Information Collection Being Reviewed by the Federal Communications Commission Under Delegated AuthorityPDF
81 FR 59427 - Viruses, Serums, Toxins, and Analogous Products; Packaging and LabelingPDF
81 FR 59598 - Opportunity for Designation in Belmond, IA; Minnesota; New Jersey; and New York Areas; Request for Comments on the Official Agency Servicing These AreasPDF
81 FR 59632 - Proposed Information Collection Activity, Comment Request Proposed ProjectPDF
81 FR 59604 - Manufacturing Extension Partnership Advisory BoardPDF
81 FR 59551 - Whistleblower Awards ProcessPDF
81 FR 59625 - Amendment to Initial Funded Priorities ListPDF
81 FR 59699 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change Amending and Restating the Second Amended and Restated Certificate of Incorporation of the Exchange's Ultimate Parent Company, Intercontinental Exchange, Inc.PDF
81 FR 59676 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend the Effective Date of SR-FINRA-2016-028PDF
81 FR 59711 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Withdrawal of a Proposed Rule Change, as Modified by Amendment No. 1, To List and Trade Shares of the First Trust Horizon Managed Volatility Domestic ETF and the First Trust Horizon Managed Volatility Developed International ETF Under NYSE Arca Equities Rule 8.600PDF
81 FR 59710 - iShares Trust, et al.; Notice of ApplicationPDF
81 FR 59688 - Calvert Social Investment Fund, et al.; Notice of ApplicationPDF
81 FR 59696 - Self-Regulatory Organizations; BOX Options Exchange LLC; Order Approving a Proposed Rule Change To Expand the Short Term Option Series Program To Allow Wednesday Expirations for SPY OptionsPDF
81 FR 59672 - Self-Regulatory Organizations; NASDAQ BX, Inc.; The Nasdaq Stock Market LLC; NASDAQ PHLX LLC; Notice of Filing of Amendments No. 1 and Order Granting Accelerated Approval of Proposed Rule Changes, as Modified by Amendments No. 1, To Adopt Limit Order ProtectionsPDF
81 FR 59700 - Self-Regulatory Organizations; Bats BZX Exchange, Inc.; Notice of Filing of a Proposed Rule Change to Rule 14.11(c)(4) To List and Trade Shares of the iShares iBonds Dec 2023 Term Muni Bond ETF and iShares iBonds Dec 2024 Term Muni Bond ETF of the iShares U.S. ETF TrustPDF
81 FR 59693 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend the Exchange's Connectivity Fees at Chapter VIII of the NASDAQ PHLX LLC Pricing SchedulePDF
81 FR 59678 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the Text of Current Rule 8313; Amending Rules Relating to the Imposition of Temporary and Current Cease and Desist Orders to Correspond to Recent Amendments by FINRA; and Making Certain Technical and Conforming Changes to Rule 9310PDF
81 FR 59696 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending and Restating the Second Amended and Restated Certificate of Incorporation of the Exchange's Ultimate Parent Company, Intercontinental Exchange, Inc.PDF
81 FR 59674 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change Amending and Restating the Second Amended and Restated Certificate of Incorporation of the Exchange's Ultimate Parent Company, Intercontinental Exchange, Inc.PDF
81 FR 59597 - Request for Extension and Revision of a Currently Approved Information Collection Under the Clear Title ProgramPDF
81 FR 59633 - Proposed Information Collection Activity, Comment RequestPDF
81 FR 59643 - National Institute of Mental Health; Notice of Closed MeetingPDF
81 FR 59643 - National Institute on Aging; Notice of Closed MeetingsPDF
81 FR 59644 - National Institute on Aging; Notice of Closed MeetingPDF
81 FR 59599 - Submission for OMB Review; Comment RequestPDF
81 FR 59522 - Importation of Fresh Persimmon With Calyxes From Japan Into the United StatesPDF
81 FR 59654 - Public Land Order No. 7855; Withdrawal of National Forest System Land for the Burgess Junction Visitor Center and Administrative Site; WyomingPDF
81 FR 59609 - Uniform Formulary Beneficiary Advisory Panel; Notice of Federal Advisory Committee MeetingPDF
81 FR 59477 - Special Local Regulation; Bucksport/Lake Murray Drag Boat Fall Nationals, Atlantic Intracoastal Waterway; Bucksport, SCPDF
81 FR 59654 - Public Land Order No. 7856; Withdrawal of National Forest System Land for the Medicine Wheel/Medicine Mountain National Historic Landmark; WyomingPDF
81 FR 59445 - Reclassification of Specially Denatured Spirits and Completely Denatured Alcohol Formulas and Related AmendmentsPDF
81 FR 59631 - Multi-Agency Informational Meeting Concerning Compliance With the Federal Select Agent Program; Public WebcastPDF
81 FR 59548 - Airworthiness Directives; The Boeing Company AirplanesPDF
81 FR 59655 - Certain Activity Tracking Devices, Systems, and Components Thereof; Notice of Request for Statements on the Public InterestPDF
81 FR 59546 - Airworthiness Directives; Airbus AirplanesPDF
81 FR 59539 - Airworthiness Directives; Bombardier, Inc. AirplanesPDF
81 FR 59530 - Airworthiness Directives; Airbus AirplanesPDF
81 FR 59528 - Airworthiness Directives; Empresa Brasileira de Aeronautica S.A. (Embraer) AirplanesPDF
81 FR 59532 - Airworthiness Directives; The Boeing Company AirplanesPDF
81 FR 59535 - Airworthiness Directives; Airbus AirplanesPDF
81 FR 59549 - Airworthiness Directives; The Boeing Company AirplanesPDF
81 FR 59541 - Airworthiness Directives; The Boeing Company AirplanesPDF
81 FR 59526 - Airworthiness Directives; Sikorsky Aircraft Corporation HelicoptersPDF
81 FR 59650 - Endangered and Threatened Wildlife and Plants; 5-Year Status Reviews of 22 Southeastern SpeciesPDF
81 FR 59544 - Airworthiness Directives; The Boeing Company AirplanesPDF
81 FR 59490 - Air Plan Approval; Reno, Nevada; Second 10-Year Carbon Monoxide Maintenance PlanPDF
81 FR 59488 - Air Plan Approval; Kentucky; Source Specific Revision for Louisville Gas and ElectricPDF
81 FR 59593 - Air Plan Approval; Reno, Nevada; Second 10-Year Carbon Monoxide Maintenance PlanPDF
81 FR 59486 - Approval and Promulgation of Air Quality Implementation Plans; Maryland; Control of Emissions From Various Processes and Fuel-Burning Equipment From Kraft Pulp MillsPDF
81 FR 59464 - Savings Arrangements Established by States for Non-Governmental EmployeesPDF
81 FR 59581 - Savings Arrangements Established by State Political Subdivisions for Non-Governmental EmployeesPDF
81 FR 59732 - Office of Hazardous Materials Safety; Actions on Special Permit ApplicationsPDF
81 FR 59518 - Federal Employees Health Benefits (FEHB) Program: FEHB Employee Premium Contributions for Employees in Leave Without Pay or Other Nonpay StatusPDF
81 FR 59499 - Citrus tristeza Virus Expressing Spinach Defensin Proteins 2, 7, and 8; Temporary Exemption From the Requirement of a TolerancePDF
81 FR 59594 - Defense Federal Acquisition Regulation Supplement: Pilot Program for Streamlining Awards for Innovative Technology Projects (DFARS Case 2016-D016)PDF
81 FR 59510 - Defense Federal Acquisition Regulation Supplement: Request for Audit Services in France, Germany, the Netherlands, or the United Kingdom (DFARS Case 2016-D027)PDF
81 FR 59510 - Defense Federal Acquisition Regulation Supplement: Costs Related to Counterfeit Electronic Parts (DFARS Case 2016-D010)PDF
81 FR 59515 - Defense Federal Acquisition Regulation Supplement: Instructions for the Wide Area WorkFlow Reparable Receiving Report (DFARS Case 2016-D004)PDF
81 FR 59659 - Biweekly Notice; Applications and Amendments to Facility Operating Licenses and Combined Licenses Involving No Significant Hazards ConsiderationsPDF
81 FR 59597 - Ketchikan Resource Advisory CommitteePDF
81 FR 59736 - Energy Conservation Program for Consumer Products and Certain Commercial and Industrial Equipment: Test Procedures for Consumer and Commercial Water HeatersPDF
81 FR 59800 - Revisions to Test Methods, Performance Specifications, and Testing Regulations for Air Emission SourcesPDF

Issue

81 168 Tuesday, August 30, 2016 Contents Agricultural Marketing Agricultural Marketing Service RULES Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order: Revision of Time Frame for Continuance Referenda, 59425-59427 2016-20805 PROPOSED RULES National Organic Program: Interim Instruction on Material Review, 59521-59522 2016-20806 Agriculture Agriculture Department See

Agricultural Marketing Service

See

Animal and Plant Health Inspection Service

See

Forest Service

See

Grain Inspection, Packers and Stockyards Administration

See

Rural Utilities Service

Alcohol Tobacco Tax Alcohol and Tobacco Tax and Trade Bureau RULES Reclassification of Specially Denatured Spirits and Completely Denatured Alcohol Formulas and Related Amendments, 59445-59464 2016-20712 Animal Animal and Plant Health Inspection Service RULES Viruses, Serums, Toxins, and Analogous Products: Packaging and Labeling, 59427-59436 2016-20749 PROPOSED RULES Importation of Fresh Persimmon with Calyxes from Japan into the United States, 59522-59526 2016-20724 Centers Disease Centers for Disease Control and Prevention NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59627-59631 2016-20762 2016-20829 2016-20830 2016-20831 Meetings: Advisory Committee to the Director, 59626 2016-20760 Compliance with Federal Select Agent Program; Multi-Agency Informational Meeting; Public Webcasts, 59631-59632 2016-20710 Requests for Nominations: Advisory Committee on Breast Cancer in Young Women, 59627 2016-20759 Children Children and Families Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: State Abstinence Education Program, 59632-59633 2016-20729 2016-20747 Civil Rights Civil Rights Commission NOTICES Meetings: Connecticut Advisory Committee, 59602 2016-20862 Michigan Advisory Committee, 59600-59601 2016-20859 New York Advisory Committee, 59601 2016-20860 Vermont Advisory Committee, 59601-59602 2016-20861 Coast Guard Coast Guard RULES Safety Zones: Caribbean Fantasy, Vessel on Fire, Punta Salinas, Toa Baja, PR, 59484-59486 2016-20856 Chesapeake Bay, Hampton, VA, 59480-59482 2016-20855 Delaware River, Philadelphia, PA, 59479 2016-20774 Dredging, Shark River, NJ, 59482-59484 2016-20820 Special Local Regulations: Bucksport/Lake Murray Drag Boat Fall Nationals, Atlantic Intracoastal Waterway; Bucksport, SC, 59477-59479 2016-20716 NOTICES Meetings: Chemical Transportation Advisory Committee; Correction, 59644 2016-20771 Commerce Commerce Department See

Foreign-Trade Zones Board

See

International Trade Administration

See

National Institute of Standards and Technology

See

National Oceanic and Atmospheric Administration

Commodity Futures Commodity Futures Trading Commission PROPOSED RULES Whistleblower Awards Process, 59551-59581 2016-20745 Council Inspectors Council of the Inspectors General on Integrity and Efficiency NOTICES Senior Executive Service Performance Review Board Membership, 59605-59608 2016-20791 Defense Acquisition Defense Acquisition Regulations System RULES Defense Federal Acquisition Regulation Supplements: Costs Related to Counterfeit Electronic Parts, 59510-59515 2016-20475 Instructions for Wide Area WorkFlow Reparable Receiving Report, 59515-59517 2016-20474 Request for Audit Services in France, Germany, Netherlands, or United Kingdom, 59510 2016-20476 PROPOSED RULES Defense Federal Acquisition Regulation Supplements: Pilot Program for Streamlining Awards for Innovative Technology Projects, 59594-59596 2016-20477 Defense Department Defense Department See

Defense Acquisition Regulations System

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 2016-20821 59611-59613 2016-20858 Agency Information Collection Activities; Proposals, Submissions, and Approvals: Report of Shipment, 59624-59625 2016-20784 Meetings: Government-Industry Advisory Panel, 59612-59613 2016-20810 Reserve Forces Policy Board, 59610-59611 2016-20835 Threat Reduction Advisory Committee, 59609-59610 2016-20895 Uniform Formulary Beneficiary Advisory Panel, 59609 2016-20717
Drug Drug Enforcement Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: National Drug Threat Survey, 59656-59657 2016-20785 Employee Benefits Employee Benefits Security Administration RULES Savings Arrangements Established by States for Non-Governmental Employees, 59464-59477 2016-20639 PROPOSED RULES Savings Arrangements Established by State Political Subdivisions for Non-Governmental Employees, 59581-59592 2016-20638 Energy Department Energy Department See

Federal Energy Regulatory Commission

RULES Applications and Authorizations for the In-Transit Movement of Natural Gas: Revised Procedures, 59436-59437 2016-20802 PROPOSED RULES Energy Conservation Programs for Consumer Products and Certain Commercial and Industrial Equipment: Test Procedures for Consumer and Commercial Water Heaters, 59736-59798 2016-20097 NOTICES Meetings: Environmental Management Advisory Board, 59613-59614 2016-20787 Environmental Management Site-Specific Advisory Board, Portsmouth; Cancellation, 59614 2016-20788
Environmental Protection Environmental Protection Agency RULES Air Quality State Implementation Plans; Approvals and Promulgations: Kentucky; Source Specific Revision for Louisville Gas and Electric, 59488-59490 2016-20656 Maryland; Control of Emissions from Various Processes and Fuel-Burning Equipment from Kraft Pulp Mills, 59486-59488 2016-20654 Reno, Nevada; Second 10-Year Carbon Monoxide Maintenance Plan, 59490-59499 2016-20662 Hazardous Waste Management System: Final Authorization of State Hazardous Waste Management Program Revisions; Maryland, 59503-59510 2016-20849 Revisions to Test Methods, Performance Specifications, and Testing Regulations for Air Emission Sources, 59800-59826 2016-19642 Tolerance Exemptions: Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8, 59499-59503 2016-20547 PROPOSED RULES Air Quality State Implementation Plans; Approvals and Promulgations: Reno, Nevada; Second 10-Year Carbon Monoxide Maintenance Plan, 59593-59594 2016-20655 Hazardous Waste Management System Revisions: Maryland; Final Authorization, 59594 2016-20842 NOTICES Meetings: Mobile Sources Technical Review Subcommittee, 59622 2016-20852 Requests for Nominations: Science Advisory Board Ecological Processes and Effects Committee; Experts to Provide Advice on Methods for Deriving Water Quality Criteria for the Protection of Aquatic Life, 59621-59622 2016-20851 Farm Credit System Insurance Farm Credit System Insurance Corporation RULES Releasing Information; Availability of Records of Farm Credit System Insurance Corporation; Fees for Provision of Information, 59437-59438 2016-20767 Federal Aviation Federal Aviation Administration RULES Commercial Space Transportation Reusable Launch Vehicle and Reentry Licensing Regulations: Technical Amendment, 59440 2016-20815 Licensing and Safety Requirements for Launch, 59438-59439 2016-20813 PROPOSED RULES Airworthiness Directives: Airbus Airplanes, 59530-59532, 59535-59539, 59546-59548 2016-20681 2016-20685 2016-20699 Bombardier, Inc. Airplanes, 59539-59540 2016-20691 Empresa Brasileira de Aeronautica S.A. (Embraer) Airplanes, 59528-59530 2016-20684 Sikorsky Aircraft Corporation Helicopters, 59526-59528 2016-20672 The Boeing Company Airplanes, 59532-59535, 59541-59546, 59548-59551 2016-20667 2016-20673 2016-20676 2016-20683 2016-20704 NOTICES Meetings: Commercial Space Transportation Advisory Committee; Public Teleconference, 59712-59713 2016-20796 Noise Exposure Maps: Baltimore/Washington International Thurgood Marshall Airport, Anne Arundel County, MD, 59714-59715 2016-20795 Petitions for Exemption; Summaries: Fusion Flight, LLC, 59713 2016-20812 Waivers of Aeronautical Land-Use Assurance: Marshall Memorial Municipal Airport, Marshall, MO, 59713-59714 2016-20793 Federal Communications Federal Communications Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59622-59623 2016-20750 Meetings: Disability Advisory Committee, 59623-59624 2016-20770 Federal Deposit Federal Deposit Insurance Corporation NOTICES Terminations of Receiverships: GreenChoice Bank, FSB Chicago, IL, 59624 2016-20769 Federal Energy Federal Energy Regulatory Commission NOTICES Combined Filings, 2016-20751 59614-59615, 59617 2016-20756 Environmental Assessments; Availability, etc.: Gulf South Pipeline Co., LP; St. Charles Parish Expansion Project, 59615-59617 2016-20752 Environmental Impact Statements; Availability, etc.: Transcontinental Gas Pipe Line Co., LLC; Northeast Supply Enhancement Project, 59618-59620 2016-20755 Filings: C.P. Crane, LLC, 59620-59621 2016-20753 Staff Attendances, 59617 2016-20754 Federal Highway Federal Highway Administration NOTICES Assumption of Authorities, 59715-59717 2016-20818 Productive and Timely Expenditure of Funds, 59717-59718 2016-20814 Federal Motor Federal Motor Carrier Safety Administration NOTICES Qualification of Drivers; Exemption Applications: Diabetes Mellitus, 59718-59729 2016-20776 2016-20777 2016-20781 2016-20782 2016-20783 Federal Railroad Federal Railroad Administration NOTICES Applications for Approval of Discontinuance or Modification of a Railroad Signal System, 59730 2016-20844 Compliance Waivers; Petitions: Delaware Coast Line Railroad, 59729 2016-20845 Nevada Northern Railway, 59730-59731 2016-20846 Federal Reserve Federal Reserve System NOTICES Formations of, Acquisitions by, and Mergers of Bank Holding Companies, 59624 2016-20773 Fish Fish and Wildlife Service NOTICES Endangered and Threatened Wildlife and Plants: 5-Year Status Reviews of 22 Southeastern Species, 59650-59652 2016-20670 Food and Drug Food and Drug Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Hazard Analysis and Critical Control Point Procedures for Safe and Sanitary Processing and Importing of Juice, 59636-59638 2016-20779 Guidance: Bioequivalence Recommendations for Risperidone, 59633-59634 2016-20778 Enforcement Policy on National Health Related Item Code and National Drug Code Numbers Assigned to Devices, 59638-59639 2016-20766 Voluntary Sodium Reduction Goals: Target Mean and Upper Bound Concentrations for Sodium in Commercially Processed, Packaged, and Prepared Foods, 59640-59641 2016-20780 Meetings: Antimicrobial Drugs Advisory Committee, 59639-59640 2016-20765 Small Business and Industry Assistance Regulatory Education for Industry Fall Conference, 59635-59636 2016-20764 Vaccines and Related Biological Products Advisory Committee, 59634-59635 2016-20763 Foreign Trade Foreign-Trade Zones Board NOTICES Applications for Subzone Status: Givaudan Flavors Corp., East Hanover, NJ, 59602-59603 2016-20840 Production Activities: Foreign-Trade Zone 26, Atlanta, GA; Eastman Kodak Co. (Aluminum Printing Plates) Columbus, Georgia, Subzone 26N, Columbus, GA, 59603 2016-20841 Foreign-Trade Zone 76, Bridgeport, CT; ASML US, Inc. (Optical, Metrology, and Lithography System Modules), Newtown and Wilton, CT, 59603 2016-20843 Forest Forest Service NOTICES Meetings: Ketchikan Resource Advisory Committee, 59597 2016-20385 General Services General Services Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Report of Shipment, 59624-59625 2016-20784 Grain Inspection Grain Inspection, Packers and Stockyards Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59597-59598 2016-20730 Designations to Provide Services, 59598-59599 2016-20748 Gulf Coast Ecosystem Restoration Council Gulf Coast Ecosystem Restoration Council NOTICES Initial Funded Priorities List, 59625-59626 2016-20743 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

Health Resources and Services Administration

See

National Institutes of Health

NOTICES Findings of Research Misconduct, 59642-59643 2016-20834
Health Resources Health Resources and Services Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Stem Cell Therapeutic Outcomes Database, 59641-59642 2016-20758 Homeland Homeland Security Department See

Coast Guard

See

U.S. Citizenship and Immigration Services

See

U.S. Customs and Border Protection

Housing Housing and Urban Development Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Application for Community Compass TA and Capacity Building Program NOFA, 59649-59650 2016-20797 Budget-Neutral Demonstration Program for Energy and Water Conservation Improvements at Multifamily Housing Residential Units, 59646-59647 2016-20801 Ginnie Mae Multiclass Securities Program Documents Forms and Electronic Data Submissions, 59647-59649 2016-20799 Multifamily Default Status Report, 59647 2016-20798 Indian Affairs Indian Affairs Bureau NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Bureau of Indian Education Medication Authorization and Incident Report Forms, 59653-59654 2016-20816 Grazing Permits, 59652 2016-20811 Interior Interior Department See

Fish and Wildlife Service

See

Indian Affairs Bureau

See

Land Management Bureau

International Trade Adm International Trade Administration NOTICES Determination of Sales at Less than Fair Value: Certain Oil Country Tubular Goods from Republic of Korea, 59603-59604 2016-20839 International Trade Com International Trade Commission NOTICES Investigations; Determinations, Modifications, and Rulings, etc.: Certain Activity Tracking Devices, Systems, and Components Thereof, 59655-59656 2016-20702 Meetings; Sunshine Act, 59656 2016-20903 Justice Department Justice Department See

Drug Enforcement Administration

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Requirement that Movie Theaters Provide Notice as to Availability of Closed Movie Captioning and Audio Description, 59657-59658 2016-20775
Labor Department Labor Department See

Employee Benefits Security Administration

Land Land Management Bureau NOTICES Public Land Orders: Wyoming, National Forest System Land for Burgess Junction Visitor Center and Administrative Site; Withdrawal, 59654 2016-20718 Wyoming; National Forest System Land for Medicine Wheel/Medicine Mountain National Historic Landmark, Withdrawal, 59654-59655 2016-20715 Maritime Maritime Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59731 2016-20866 Agency Information Collection Activities; Proposals, Submissions, and Approvals: Information to Determine Seamen's Reemployment Rights: National Emergency, 59732 2016-20874 Requests for Administrative Waivers of the Coastwise Trade Laws: Vessel AFTER HOURS, 59731-59732 2016-20865 Millenium Millennium Challenge Corporation RULES Collection of Debts, 59440-59445 2016-20800 NASA National Aeronautics and Space Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Report of Shipment, 59624-59625 2016-20784 National Institute National Institute of Standards and Technology NOTICES Meetings: Manufacturing Extension Partnership Advisory Board, 59604-59605 2016-20746 National Institute National Institutes of Health NOTICES Meetings: Diabetes Mellitus Interagency Coordinating Committee, 59643 2016-20824 National Institute of Mental Health, 59643-59644 2016-20728 National Institute on Aging, 59643-59644 2016-20726 2016-20727 National Oceanic National Oceanic and Atmospheric Administration RULES Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic: Blueline Tilefish in the South Atlantic Region; Commercial Accountability Measures and Closure, 59517 2016-20847 Nuclear Regulatory Nuclear Regulatory Commission NOTICES Exemptions: Exelon Generation Co., LLC; Calvert Cliffs Nuclear Power Plant, Units 1 and 2; Update Schedule for Updated Final Safety Analysis Report, 59670-59672 2016-20804 Facility Operating and Combined Licenses: Applications and Amendments Involving Proposed No Significant Hazards Considerations, etc., 59659-59669 2016-20391 License Amendment Applications: Omaha Public Power District; Fort Calhoun Station, Unit No. 1, 59669-59670 2016-20807 Meetings; Sunshine Act, 59659 2016-20916 Requests for Nominations: Advisory Committee on Medical Uses of Isotopes, 59658 2016-20809 Personnel Personnel Management Office PROPOSED RULES Federal Employees Health Benefits Program: FEHB Employee Premium Contributions for Employees in Leave Without Pay or Other Nonpay Status, 59518-59521 2016-20565 Pipeline Pipeline and Hazardous Materials Safety Administration NOTICES Hazardous Materials: Actions on Special Permit Applications, 59732-59733 2016-20590 Postal Regulatory Postal Regulatory Commission PROPOSED RULES Periodic Reporting, 59592-59593 2016-20822 2016-20823 Presidential Documents Presidential Documents PROCLAMATIONS Special Observances: Women's Equality Day (Proc. 9477), 59421-59423 2016-20949 Rural Utilities Rural Utilities Service NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59599-59600 2016-20725 Securities Securities and Exchange Commission NOTICES Applications: Calvert Social Investment Fund, et al., 59688-59693 2016-20738 iShares Trust, et al., 59710-59711 2016-20739 Meetings; Sunshine Act, 59698 2016-20952 Self-Regulatory Organizations; Proposed Rule Changes: Bats BZX Exchange, Inc., 59700-59709 2016-20735 BOX Options Exchange, LLC, 59696 2016-20737 Financial Industry Regulatory Authority, Inc., 59676-59677 2016-20741 NASDAQ BX, Inc., 59672-59674 2016-20736 NASDAQ PHLX, LLC, 59693-59696 2016-20734 New York Stock Exchange, LLC, 59678-59688, 59699-59700 2016-20733 2016-20742 NYSE Arca, Inc., 59674-59676, 59711 2016-20731 2016-20740 NYSE MKT, LLC, 59696-59698 2016-20732 Trading Suspension Orders: MarilynJean Interactive, Inc., 59674 2016-20924 Small Business Small Business Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59712 2016-20850 Surface Transportation Surface Transportation Board NOTICES Meetings: National Grain Car Council, 59712 2016-20848 Transportation Department Transportation Department See

Federal Aviation Administration

See

Federal Highway Administration

See

Federal Motor Carrier Safety Administration

See

Federal Railroad Administration

See

Maritime Administration

See

Pipeline and Hazardous Materials Safety Administration

Treasury Treasury Department See

Alcohol and Tobacco Tax and Trade Bureau

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 59733 2016-20857 Multiemployer Pension Plan Application To Reduce Benefits, 59733-59734 2016-20790
U.S. Citizenship U.S. Citizenship and Immigration Services NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Application for Travel Document, 59645-59646 2016-20772 Customs U.S. Customs and Border Protection NOTICES Automated Commercial Environments: Sole CBP-Authorized Electronic Data Interchange System for Processing Electronic Drawback and Duty Deferral Entry and Entry Summary Filings, 59644-59645 2016-20794 Separate Parts In This Issue Part II Energy Department, 59736-59798 2016-20097 Part III Environmental Protection Agency, 59800-59826 2016-19642 Reader Aids

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

To subscribe to the Federal Register Table of Contents electronic mailing list, go to https://public.govdelivery.com/accounts/USGPOOFR/subscriber/new, enter your e-mail address, then follow the instructions to join, leave, or manage your subscription.

81 168 Tuesday, August 30, 2016 Rules and Regulations DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 1217 [Document Number AMS-SC-16-0054] Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order; Revision of Time Frame for Continuance Referenda AGENCY:

Agricultural Marketing Service, USDA.

ACTION:

Interim rule.

SUMMARY:

This interim rule invites comments on revising the time frame for continuance referenda under the Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order (Order). The Order is administered by the Softwood Lumber Board (Board) with oversight by the U.S. Department of Agriculture (USDA). The Order requires USDA to conduct a continuance referendum five years after the program took effect (2011). This action revises this time frame from five years (2016) to no later than seven years (2018). This will allow time for USDA to complete a separate rulemaking action on the Order's exemption threshold. That rulemaking is being initiated in response to a federal district court decision in Resolute Forest Products Inc., v. USDA, et al. (Resolute). Once USDA completes that action, a continuance referendum will be conducted. The results of the exemption threshold rulemaking could impact who votes in the referendum and who pays assessments under the Order.

DATES:

Effective August 31, 2016. Comments received by October 31, 2016 will be considered prior to issuance of a final rule.

ADDRESSES:

Interested persons are invited to submit written comments concerning this interim rule. Comments may be submitted on the Internet at: http://www.regulations.gov or to the Promotion and Economics Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW., Room 1406-S, Stop 0244, Washington, DC 20250-0244; facsimile: (202) 205-2800. All comments should reference the document number and the date and page number of this issue of the Federal Register and will be made available for public inspection, including name and address, if provided, in the above office during regular business hours or it can be viewed at http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT:

Maureen T. Pello, Marketing Specialist, Promotion and Economics Division, Specialty Crops Program, AMS, USDA, P.O. Box 831, Beavercreek, Oregon 97004; telephone: (503) 632-8848; facsimile (503) 632-8852; or electronic mail: [email protected]

SUPPLEMENTARY INFORMATION:

This interim rule is issued under the Order (7 CFR part 1217). The Order is authorized under the Commodity Promotion, Research and Information Act of 1996 (1996 Act) (7 U.S.C. 7411-7425).

Executive Order 12866 and Executive Order 13563

Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules and promoting flexibility. This action has been designated as a “non-significant regulatory action” under section 3(f) of Executive Order 12866. Accordingly, the Office of Management and Budget (OMB) has waived the review process.

Executive Order 13175

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

Executive Order 12988

This interim rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. Section 524 of the 1996 Act (7 U.S.C. 7423) provides that it shall not affect or preempt any other Federal or State law authorizing promotion or research relating to an agricultural commodity.

Under section 519 of the 1996 Act (7 U.S.C. 7418), a person subject to an order may file a written petition with USDA stating that an order, any provision of an order, or any obligation imposed in connection with an order, is not established in accordance with the law, and request a modification of an order or an exemption from an order. Any petition filed challenging an order, any provision of an order, or any obligation imposed in connection with an order, shall be filed within two years after the effective date of an order, provision, or obligation subject to challenge in the petition. The petitioner will have the opportunity for a hearing on the petition. Thereafter, USDA will issue a ruling on the petition. The 1996 Act provides that the district court of the United States for any district in which the petitioner resides or conducts business shall have the jurisdiction to review a final ruling on the petition, if the petitioner files a complaint for that purpose not later than 20 days after the date of the entry of USDA's final ruling.

Background

This interim rule invites comments on revising the time frame for continuance referenda under the Order. The Order is administered by the Board with oversight by USDA. The Order requires USDA to conduct a continuance referendum five years after the program took effect (2011). This action revises this time frame from five years (2016) to no later than seven years (2018). This will allow time for USDA to complete a separate rulemaking action on the Order's exemption threshold. That rulemaking is being initiated in response to a federal district court decision in Resolute. Once USDA completes that action, a referendum will be conducted. The results of that rulemaking could impact who votes in the referendum and who pays assessments under the program.

The softwood lumber program was promulgated in 2011. Assessment collection began in January 2012. Under the Order, assessments are collected from U.S. manufacturers (domestic) and importers and used for projects designed to increase the demand for softwood lumber within the United States. Softwood lumber is used in products like flooring, siding and framing. Entities that domestically ship or import less than 15 million board feet annually are exempt from paying assessments.

Authorities and Action

Section 518 of the 1996 Act (7 U.S.C. 7417) authorizes continuance referenda. Paragraph (b) of that section requires USDA to conduct a referendum not later than seven years after assessments first begin under an order. Under § 1217.81(b)(2) of the softwood lumber Order, USDA must conduct a referendum five years after the program took effect to determine whether persons subject to assessment favor continuance of the Order, and then every five years thereafter. A referendum was initially scheduled for August 2016.

USDA is conducting an analysis on the 15 million board foot exemption threshold under the Order, as specified in paragraphs (a) and (b) of section 1217.53. USDA is analyzing this threshold based on recent data and will publish the results of its analysis for public comment in a future rulemaking action. Once this rulemaking is completed, USDA will conduct a referendum. The results of that rulemaking could impact who votes in the referendum and who pays assessments under the program.

USDA will be initiating the future rulemaking action on the Order's exemption threshold in response to a May 2016 federal district court decision in Resolute. All program obligations, including the collection of assessments and filing of reports, remain in effect.

Therefore, USDA has postponed the August 2016 referendum and is revising paragraph (2) in section 1217.81(b) to specify that a referendum must be conducted no later than seven years (2018) after the program took effect. This will allow time for USDA to complete the rulemaking action on the exemption threshold under the program and conduct a referendum. Section 1217.81(b)(2) is revised accordingly. Authority for USDA to amend the Order is provided in section 1217.87 of the Order and in section 514(d) of the 1996 Act (7 U.S.C. 7413).

Initial Regulatory Flexibility Act Analysis

In accordance with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), AMS is required to examine the impact of the interim rule on small entities. Accordingly, AMS has considered the economic impact of this action on such entities.

The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions so that small businesses will not be disproportionately burdened. The Small Business Administration defines, in 13 CFR part 121, small agricultural producers as those having annual receipts of no more than $750,000 and small agricultural service firms (domestic manufacturers and importers) as those having annual receipts of no more than $7.5 million.

Based on 2015 Board data, it is estimated that there are about 375 domestic manufacturers of softwood lumber in the United States. Using an average price of $330 per thousand board feet,1 a domestic manufacturer who ships less than about 23 million board feet per year would be considered a small entity. It is estimated that fewer than 240 domestic manufacturers, or 64 percent, ship under 23 million board feet annually.

1 Price data was obtained from Random Lengths Publications, Inc., and is a framing composite price that is designed as a broad measure of price movement in the lumber market. Random Lengths describes itself as a firm that “provides the forest products industry with unbiased, consistent and timely reports of market activity and prices, related trends, issues, and analyses.” (www.randomlengths.com).

Likewise, based on 2015 U.S. Customs and Border Protection (Customs) data, it is estimated there are 890 importers of softwood lumber. About 790 importers, or 89 percent, each imported less than $7.5 million worth of softwood lumber annually. Thus, for purposes of the RFA, the majority of domestic manufacturers and importers of softwood lumber would be considered small entities.

Regarding value of the commodity, with domestic consumption estimated at 43.9 billion board feet in 2015,2 and using a price of $330 per thousand board feet, the annual domestic value for softwood lumber is about $14.5 billion. According to 2015 Customs data, the annual value for softwood lumber imports is about $5.0 billion.

2 Consumption data is from Forest Economic Advisors (FEA). FEA describes itself as a firm that “brings modern econometric techniques to the forest products industry.” (www.getfea.com).

This interim rule invites comments on revising the time frame for continuance referenda under the Order. The Order is administered by the Board with oversight by USDA. Section 1217.81(b)(2) of the Order requires USDA to conduct a continuance referendum five years after the program took effect (2011). This action revises this section to change the time frame from five years (2016) to no later than seven years (2018). This will allow time for USDA to complete a separate rulemaking action on the Order's exemption threshold. That rulemaking is being initiated in response to a federal district court decision in Resolute. Once USDA completes that action, a referendum will be conducted. The results of that rulemaking could impact who votes in the referendum and who pays assessments under the program. Authority for this action is provided in section 1217.87 of the Order and in section 514(d) of the 1996 Act (7 U.S.C. 7413).

Regarding the economic impact of this interim rule, this change is administrative in nature. Postponing the 2016 referendum will allow time for USDA to complete a separate rulemaking action on the Order's exemption threshold and conduct a referendum as described above. The results of that rulemaking could impact who votes in the referendum and who pays assessments under the program.

Regarding alternatives, conducting the referendum as initially planned in 2016 would cause confusion in the industry. USDA is currently conducting an analysis on the exemption threshold under the Order and will publish the results in a separate rulemaking action. That action is being initiated in response to Resolute. Once USDA completes that action, a referendum will be conducted. The results of that rulemaking action could impact who votes in the referendum.

In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the information collection and recordkeeping requirements that are imposed by the Order have been approved previously under OMB control number 0581-0093. This interim rule imposes no additional reporting and recordkeeping burden on domestic manufacturer and importers of softwood lumber.

As with all Federal promotion programs, reports and forms are periodically reviewed to reduce information requirements and duplication by industry and public sector agencies. Finally, USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this interim rule.

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

Regarding outreach efforts, USDA announced at the Board's meeting on May 25, 2016, that the referendum scheduled for August 2016 would be postponed to a future to-be-determined date. USDA also announced at the meeting that it would publish a notice in the Federal Register on the postponement. After the meeting, the Board issued a newsflash to industry members advising them accordingly.

A 60-day comment period is provided to allow interested persons to respond to this interim rule. All written comments received in response to this rule by the date specified will be considered prior to finalizing this action.

After consideration of all relevant material presented, and other information, it is found that this interim rule, as hereinafter set forth, will tend to effectuate the declared purposes of the 1996 Act.

Pursuant to 5 U.S.C. 553, it is also found and determined upon good cause that it is impracticable, unnecessary, and contrary to the public interest to give preliminary notice prior to putting this rule into effect and that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register because: (1) This interim rule extends the time frame for USDA to conduct a referendum under the Order from five years (2016) after the program took effect to no later than seven years (2018); (2) postponing the 2016 referendum will give USDA time to complete a separate rulemaking action on the Order's exemption threshold that is being initiated in response to a May 2016 federal district court decision in Resolute; (3) USDA announced at the Board's meeting on May 25, 2016, that the 2016 referendum would be postponed, and the Board subsequently issued a newsflash to industry members advising them of the postponed referendum; and (4) this rule provides a 60-day comment period and any comments received will be considered prior to finalization of this rule.

List of Subjects in 7 CFR Part 1217

Administrative practice and procedure, Advertising, Consumer information, Marketing agreements, Promotion, Reporting and recordkeeping requirements, Softwood lumber.

For the reasons set forth in the preamble, 7 CFR part 1217 is amended as follows:

PART 1217—SOFTWOOD LUMBER RESEARCH, PROMOTION, CONSUMER EDUCATION AND INDUSTRY INFORMATION ORDER 1. The authority citation for 7 CFR part 1217 continues to read as follows: Authority:

7 U.S.C. 7411-7425; 7 U.S.C. 7401.

2. In § 1217.81, revise paragraph (b)(2) to read as follows:
§ 1217.81 Referenda.

(b) * * *

(2) No later than seven years after this Order becomes effective and every five years thereafter, to determine whether softwood lumber manufacturers for the U.S. market favor the continuation of the Order. The Order shall continue if it is favored by a majority of domestic manufacturers and importers voting in the referendum who also represent a majority of the volume of softwood lumber represented in the referendum who, during a representative period determined by the Secretary, have been engaged in the domestic manufacturing or importation of softwood lumber;

Dated: August 25, 2016. Elanor Starmer, Administrator.
[FR Doc. 2016-20805 Filed 8-29-16; 8:45 am] BILLING CODE 3410-02-P
DEPARTMENT OF AGRICULTURE Animal and Plant Health Inspection Service 9 CFR Parts 101, 103, 112, 113, and 114 [Docket No. APHIS-2008-0008] RIN 0579-AD19 Viruses, Serums, Toxins, and Analogous Products; Packaging and Labeling AGENCY:

Animal and Plant Health Inspection Service, USDA.

ACTION:

Final rule.

SUMMARY:

We are amending the Virus-Serum-Toxin Act regulations regarding the packaging and labeling of veterinary biological products to provide for the use of an abbreviated true name on small final container labeling for veterinary biologics; require labeling to bear a consumer contact telephone number; change the format used to show the establishment or permit number on labeling and require such labeling to show the product code number; change the storage temperature recommended in labeling for veterinary biologics; require vaccination and revaccination recommendations in labeling to be consistent with licensing data; require labeling information placed on carton tray covers to appear on the outside face of the tray cover; remove the restriction requiring multiple-dose final containers of veterinary biologics to be packaged in individual cartons; require labeling for bovine virus diarrhea vaccine containing modified live virus to bear a statement warning against use in pregnant animals; reduce the number of copies of each finished final container label, carton label, or enclosure required to be submitted for review and approval; require labels for autogenous biologics to specify the organism(s) and/or antigen(s) they contain; and require labeling for conditionally licensed veterinary biologics to bear a statement concerning efficacy and potency requirements. In addition, we are also amending the regulations concerning the number of labels or label sketches for experimental products required to be submitted for review and approval, and the recommended storage temperature for veterinary biologics at licensed establishments. These changes are necessary in order to update and clarify labeling requirements and to ensure that information provided in labeling is accurate with regard to the expected performance of the product.

DATES:

Effective October 31, 2016.

FOR FURTHER INFORMATION CONTACT:

Dr. Donna L. Malloy, Section Leader, Operational Support, Center for Veterinary Biologics Policy, Evaluation, and Licensing, VS, APHIS, 4700 River Road Unit 148, Riverdale, MD 20737-1231; (301) 851-3426.

SUPPLEMENTARY INFORMATION:

Background

Under the Virus-Serum-Toxin Act (the Act, 21 U.S.C. 151-159) and regulations issued under the Act, the Animal and Plant Health Inspection Service (APHIS) grants licenses or permits for biological products which are pure, safe, potent, and efficacious when used according to label instructions. The regulations in 9 CFR part 112, “Packaging and Labeling” (referred to below as the regulations), prescribe requirements for the packaging and labeling of veterinary biological products including requirements applicable to final container labels, carton labels, and enclosures. The main purpose of the regulations in part 112 is to regulate the packaging and labeling of veterinary biologics in a comprehensive manner, which includes ensuring that labeling provides adequate instructions for the proper use of the product, including vaccination schedules, warnings, and cautions. Complete labeling (either on the product or accompanying the product) must be reviewed and approved by APHIS in accordance with the regulations in part 112 prior to their use.

Although the science of immunology and our understanding of how veterinary biologics work have advanced substantially in recent years, communicating such information to consumers and veterinarians by way of updated labeling claims, cautions, and warnings is a top priority of APHIS. Therefore, on January 13, 2011, we published in the Federal Register (76 FR 2268-2277, Docket No. APHIS-2008-0008) a proposal 1 to amend the regulations to make veterinary biologics labeling requirements more consistent with current science and veterinary practice.

1 To view the proposed rule and the comments we received, go to http://www.regulations.gov/#!docketDetail;D=APHIS-2008-0008.

We solicited comments concerning our proposal for 60 days ending March 14, 2011. We received six comments from five commenters by that date. The comments were from licensees, permittees, veterinary biologics industry associations, and a veterinary medical association. All of the commenters were generally supportive of the proposed rule, but raised a number of questions and concerns about its provisions. They are discussed below by topic.

True Name, Abbreviated True Names, Functional/Chemical Name

Two commenters noted that the proposed rule states that the abbreviated true name must be identical to that shown on the product license. One commenter stated that the use of abbreviations for true names on small labels would be beneficial only if they are standardized. This commenter expressed concern that without standardization, the use of such abbreviations could result in confusion. The other commenter stated that it was unclear whether the proposal means that a standardized abbreviation that corresponds to the true name shown on the license must be used, that the abbreviation will be negotiated on a case-by-case basis and noted on the product license, or that no abbreviations may be used unless they are also reflected on the product license. The commenter further stated that reissuing licenses for every approved biologic product simply to add abbreviations is unreasonable, and that APHIS should issue a memorandum with a list of standardized abbreviations for use by licensees.

APHIS will assign abbreviated true names when issuing new product licenses, when there is a need to reissue a product license (e.g., renewal of Conditional Licenses, or change in ownership) or upon specific request.

One commenter stated that container labels for diagnostic kits should not be required to include both the true name of the kit and the functional and/or chemical name of the reagent. The commenter noted that the proposed rule includes a requirement to add product code numbers and that this will provide consumers with a reference to connect the component with the specific kit. The commenter further stated that adding the true name would not give consumers any additional useful information, but would significantly increase the amount of text required on the label.

APHIS agrees that reagents can be linked to a particular kit through the product code as well as the true name, and we have amended § 112.2(a)(3)(ii) to specify that the product code number may be used in lieu of the true name on small containers for critical components of diagnostic kits. In the case of small reagent containers within a diagnostic kit, those reagents that should not be used with other kits must bear functional/chemical name of the reagent and the applicable kit product code, but not necessarily the true name of the kit. Reagents that are considered interchangeable need not have the kit product code, but must bear the functional/chemical name of the reagent.

One commenter stated that the proposed rule's “Background” section indicates that carton labels and enclosures would be required to contain both the full true name and the associated abbreviation, but that the regulatory text does not include such a provision. Two commenters also stated that if a licensee does not use an abbreviation on the final container label, then an explanation of the abbreviation should not be required on the carton label and enclosure.

APHIS acknowledges that there was an inconsistency between the preamble and regulatory text in the proposed rule; the provisions in the regulatory text are correct. APHIS also agrees with the commenters that an explanation of an abbreviation should not be required on the carton label and enclosure when the abbreviation is not used on the final container label. We note that § 112.2(a)(1)(i) states that the abbreviation may be used on small final containers, provided that the complete true name must appear on the carton label and enclosures, but does not require explanations of abbreviation if abbreviations are not used.

One commenter stated that firms should be allowed to use existing abbreviated names and have input on newly assigned abbreviated names. The commenter noted that abbreviated names are currently used as part of foreign registrations and that any changes would require significant submission and label review (including registration fees) by several authorities. The commenter also noted that these names are often part of corporate branding strategies that are costly to develop and implement. The commenter stated that unless there are specific concerns with an existing or requested abbreviated name (e.g., mislabeling), APHIS should not require changes in existing products nor reject reasonable suggestions by the firms.

APHIS is aware that there are a variety of issues associated with changing established abbreviations and may allow licensees to use established abbreviations on export labels on a case-by-case basis.

Consumer Contact Telephone Number

Two commenters stated that in the case of small final container labels, the requirement for a consumer contact telephone number in § 112.2(a)(2) should be waived when the telephone number is included on the carton label or enclosure. Another commenter stated that there will likely be instances where it will be difficult to include all contact information on a small final container without rendering the text illegible. This commenter stated that in these instances, there should be an exception allowing this information to be provided on a minimum of one labeling component (e.g., carton label or enclosure).

For small, single-dose containers, APHIS will consider this requirement to be satisfied if all contact information, including the telephone number, is provided on the carton and enclosure labeling materials. We have amended the regulatory text to read “Provided, that in the case of a biological product exported from the United States in labeled final containers, a consumer contact telephone number is not required; however, small single dose containers marketed in the United States must include contact telephone information on carton and enclosures,” to clarify this requirement.

Veterinary License/Permit Number and Product Code Number

Two commenters opposed requiring a product code number on labeling materials. The commenters stated that instead of facilitating product identification in the field, it would more likely add to confusion by those trying to identify a product in distribution channels and in the field. The commenters stated that historically there has been no difficulty using a licensee's product serial number to trace it back to a specific product code.

APHIS disagrees with the commenters. We believe that adding the product code will provide a valuable piece of information that will allow the consumer to differentiate between products with the same trade name. For example, if a company makes a product which contains a dye, and another which does not, the products would have different products codes but the same true name. If a consumer reports a problem with one of these products, we would not be able to identify which product caused the problem using only the true name.

One commenter asked whether peel-off labels intended for insertion in medical records would be required to contain the veterinary license number or veterinary permit number, the Product Code number, and the serial number. The commenter expressed concern that this may not be possible without rendering text illegible.

APHIS notes that there are currently no regulations that specify the information that must appear on a peel-off portion of a label, nor would this final rule establish any. Instead, it requires certain information appear on container labels, with exceptions given to small final containers and containers of interchangeable reagents included in diagnostic test kits.

One commenter asked how the proposal addresses combination packages, where the product code for the combination package is different from the product code for the lyophilized cake, which is different from the product code for the diluent vaccine. Similarly, one commenter stated that if the requirement for the product code number is kept, then biological product container labels should also be exempt from the requirement unless they are stand-alone presentations. The commenter stated that there are situations in which desiccated and diluent components can be used in multiple licensed combinations.

APHIS agrees with the commenters that having different product codes on components and a combination package carton could be confusing to consumers. We have amended the regulatory text by adding a new paragraph (iii) to § 112.2(a)(3) that allows container labels for components of combination packages to read “see carton for product code.” In addition, we are adding a definition of “combination package” to § 101.3. Because combination packages, which contains two or more licensed biological products, are not a new concept to the regulated industry, and further, the term “combination package” is used in the regulations, specifically in § 101.3(h) and § 112.2(a)(9)(iv), we believe that it would be beneficial to define this term in order to clarify these new packaging and labeling requirements.

Instructions for Use of the Product

One commenter did not object to the revision of the description of “full directions for use” in § 112.2(a)(5)(i) but suggested two changes. The commenter stated first that the phrase “very small” should be deleted in the first line, because this would make the question of applicability needlessly complicated and second that “carton tray covers” should be added to the list of locations that may be too small. Another commenter suggested revising § 112.2(a)(5)(i) to read “In case of limited space on final container labels, cartons, or carton tray covers, a statement shall be used as to where such information is to be found . . .”. This commenter stated that APHIS currently allows the reference to a carton or insert for complete information, and requested the revision to ensure that the practice can be continued.

APHIS does not agree that limited space is a problem with cartons or carton tray covers. We believe that with the exception of small containers, there is ample space for this information. We agree with the second commenter that limited space on final container labels may present a problem and have amended the requirements to allow a statement referring to a carton or insert on final container labels. We have also removed the words “very small” as requested by the first commenter. The provisions now appear in § 112.2(a)(5).

Disposal of Containers and Warnings

One commenter stated that as written, the proposed requirements in § 112.2(a)(7) would apply to both viable and killed products, but that they should instead apply only to products containing viable organisms because there is no rationale for requiring inactivation of inactivated products.

APHIS agrees with the commenter. We have amended the regulatory text to clarify that the requirement to inactivate applies only to product containing viable organisms.

One commenter stated that § 112.2(a)(7) should give licensees the added flexibility of recognizing situations in which the warning would not be on the container label. The commenter suggested rephrasing the warning to read “Do not mix with other biological products except as specified on this label [or carton, or insert, as applicable].”

APHIS agrees that minor modifications of the text in the regulations may be appropriate. We have amended the introductory text of § 112.2(a)(7) to allow added flexibility for statements of equivalent intent.

Two commenters stated that there should be a shortened version of the warning for small-label situations, such as, “Do not mix with other products.” This would allow for use of a larger, more legible font size for the warning. The same two commenters stated that the warning in § 112.2(a)(7)(ii) should be revised to read “In case of human exposure, contact a physician.” The commenters stated that this language would convey the same information, would be more concise, and would allow the use of a larger, more legible font size for the warning.

APHIS agrees with the commenters that these shorter warning statements are appropriate. We have amended the recommended statements to read “Do not mix with other products, except as specified on this label” and “In case of human exposure, contact a physician.” As we explained above, we have also amended the introductory text of § 112.2(a)(7) to allow equivalent statements.

Two commenters stated that there should be a shortened version of the inactivation notice for small-container labels, such as “Inactivate unused contents.” This would allow for use of a larger, more legible font size for the warning. Another commenter stated that the additional statements will contribute to space and legibility issues on labels. The commenter stated that the additional statements should be allowed to be included on an insert or carton label.

APHIS will consider shortened versions on a case-by-case basis to accommodate space issues.

One commenter stated that the preamble of the proposed rule states that chemical treatment will be required prior to disposal of containers containing viable or dangerous organisms or viruses; however, § 112.2(a)(7)(iii) states “inactivate” which suggests that other forms of inactivation other than chemical will be allowed. The commenter asked if that was the intent.

The commenter is correct that there was a discrepancy between the preamble and proposed regulatory text. Consumers may use any suitable means to inactivate unused contents.

One commenter stated that the proposed changes to § 112.7(g)(4) would require changes in revaccination recommendations for all instances in which there are not sufficient data for specific recommendations. The commenter stated that these changes should be applied only prospectively as the labeling for such products are otherwise modified.

APHIS does not agree that this rule should apply only to new labels that are submitted for approval, and not to labels that are currently approved. We believe that having two standards for information that appears on labels would be confusing to the public and to the industry. We note that we have made nonsubstantive, editorial changes to § 112.7 and this requirement now appears in paragraph (f) rather than paragraph (g)(4).

One commenter supported the proposed changes to § 112.6(a) to allow flexibility in the packaging of diluent with biological products. The commenter stated, however, that proposed § 112.2(f)(1) has not been revised to authorize this flexibility, and recommended that it be changed accordingly.

The commenter is correct. We have amended the paragraph to read “If a carton label or an enclosure is required to complete the labeling for a multiple-dose final container of liquid biological product, only one final container, with a container of diluent if applicable, shall be packaged in each carton: Provided, That if the multiple-dose final container is fully labeled without a carton label or enclosure, two or more final containers, and a corresponding number of diluent containers, may be packaged in a single carton which shall be considered a shipping box. Labels or stickers for shipping boxes shall not contain false or misleading information, but need not be submitted to APHIS for approval.”

Non-Antibiotic Preservatives

One commenter stated that the term “non-antibiotic preservative” is not defined in § 101.3 and asked for additional clarification so that firms could comply with the labeling requirement.

The regulations previously restricted disclosure to antibiotic preservatives, but APHIS believes that non-antibiotic preservatives may need to be disposed of properly (e.g., merthiolate, phenol) or have consumer safety impact (e.g., sodium azide). This information needs to be readily available to consumers. Any preservative, regardless of nature, should be disclosed. We have amended § 112.2(a)(10) to remove the specific references to antibiotic and non-antibiotic preservatives.

One commenter asked whether residual traces of an inactivating agent would be considered a preservative under proposed § 112.2(a)(10).

Under § 112.2(a)(10), inactivants are not considered preservatives.

One commenter also asked whether, if this change is adopted, there would not be any reason to maintain a distinction between antibiotic and non-antibiotic preservatives.

APHIS agrees that there is no need to maintain that distinction. We have amended § 112.2(a)(10) to specify only that a statement naming the preservative used must appear on the final container label, or on cartons and enclosures, if used.

Two commenters noted that there are differing opinions about what is or is not a preservative. Both commenters stated these concerns could be resolved by revising the paragraph to state that the labeling will include the preservatives as listed in section IV.B of the Outline of Production. One commenter stated that if APHIS does not modify the proposed rule to identify only those items in section IV.B of the Outline of Production, label identification should not apply simply because a non-antibiotic preservative is used at any step in the production process. The commenter stated that such materials may be used in stages of the manufacturing process, yet through a dilution effect or processes the residual levels are determined to be nominal. The commenter stated that APHIS should consider the establishment of a threshold for determining the level of non-antibiotic preservatives at which this requirement is triggered.

Any preservatives still remaining at detectable levels in completed products should be declared on labeling. We have amended § 112.2(a)(10) to clarify this requirement. We will develop guidance on this issue and make it available in an update to VS Memorandum 800.54 (Guidelines for the Preparation and Review of Labeling Materials). This memorandum is available on the APHIS Web site at https://www.aphis.usda.gov/aphis/ourfocus/animalhealth/veterinary-biologics/biologics-regulations-and-guidance/ct_vb_vs_memos.

One commenter stated that concerns for potential residues in food and unfavorable reactions in animals are not applicable to diagnostic test kits, regardless of whether the preservatives used are antibiotic or non-antibiotic.

APHIS agrees, but describing the potentially hazardous ingredients in any biological product is also important from a standpoint of proper disposal. For this reason, this rule applies to diagnostic test kits.

One commenter stated that potential environmental harm is not based on whether the preservative is antibiotic or non-antibiotic. The commenter further stated that the distinction is arbitrary in assessing environmental harm and does not support a requirement to include non-antibiotic preservatives but rather to exempt antibiotic preservatives. The commenter also expressed concern that extending the rule to include considerations of environmental harm seems to go beyond the scope of the Virus-Serum-Toxin Act.

Several States and municipalities have legislation regarding the disposal of certain products, such as those containing mercury. Disclosing all preservatives facilitates proper disposal of products in accordance with State laws and local ordinances.

For Animal Use Only

Two commenters stated that the preamble of the proposed rule indicates that the change in § 112.2(d)(3) to require the statement “for use in animals only” instead of “for veterinary use only” is intended to clarify that the product is for use in animals rather than for use in humans. The commenters stated that they did not believe this was an issue of significant confusion. One commenter further stated that because this change is not related to concerns regarding the purity, potency, safety, or efficacy of veterinary biological products, APHIS should allow for the use of alternative similar statements, including the current “for veterinary use only.” The other commenter stated that providing for alternatives would allow the use of a single label, both domestically and internationally, for a product that may be exported to a jurisdiction where minor differences in wording are required. The commenter stated that such a policy would promote the export of veterinary biologics from the United States. The commenter also noted that Canada requires the label statement “Veterinary use only.”

APHIS prefers the warning “for animal use only” as a replacement for “for veterinary use only” on domestic labeling but § 112.2(d)(3) states that “for animal use” may be used, not that it must be used. This does not preclude alternative wording where justified.

Two commenters stated that it is not clear why the proposed regulations direct the licensee to put the warning on “carton labels and enclosures” rather than the more general “labeling as appropriate.” The commenter recommended that the more general language be used.

APHIS agrees with the commenters and has amended § 112.2(d)(3) to use the more general language suggested.

Special Labels for Export

Three commenters noted that proposed § 112.2(e) contains requirements that differ significantly from the provisions of VS Memorandum 800.208 (Special Labels for Product for Export). One commenter stated that this section should not be amended at all and the proposed changes should be rejected. Another commenter stated that the section needs to be rewritten to reflect the more practical policy of the memorandum. One commenter also stated that the proposed rule does not include consideration for foreign-language portions of multi-language kit labeling. The commenter pointed out that a variation in a test protocol might be required in a specific country and asked that APHIS allow the protocol to appear in the specific language with an accompanying statement that it is approved only in the identified country.

APHIS is aware that some foreign regulatory authorities do not provide label approvals per se. We have amended § 112.2(e) to provide flexibility in the type of foreign documentation provided and to be consistent with established guidelines currently in VS Memorandum 800.208.

Carton Tray Covers

Two commenters raised concerns about the proposed requirements for carton tray covers. One commenter stated that it is appropriate to address labeling on tray covers, but that the language of proposed § 112.2(f)(2) would require all labeling to be on the outside face of the tray. The commenter stated that in the case of small covers, there should be flexibility to allow a sentence referring the user to another location of full labeling information. The commenter also stated that § 112.2(f)(2) should be amended to be consistent with, or combined with § 112.2(a)(5). The commenter further stated that the regulations should indicate which information should be immediately visible to the consumer and which could be provided elsewhere with reference to that location on the carton. The other commenter stated that § 112.2(f)(2) should be amended to read “In case of limited space on final container labels, carton labels, or carton tray covers, a statement shall be used as to where such information is to be found . . .” This commenter stated that APHIS currently allows the reference to an enclosure for complete information and the proposal should be amended to allow that practice to continue.

As we explained in the proposed rule, carton tray covers have come to be extensively used in the packaging of diagnostic test kits. They are also used in the packaging of multi-packs of single-dose vaccine. The proposed change would ensure that the information shown on carton tray covers is equivalent to other types of cartons and is presented in a manner that is accessible to the consumer without having to open the product. We are making no changes in response to this comment.

Packaging Multiple-Dose Final Containers

The commenter stated that, according to the preamble of the proposed rule, the changes to § 112.6(a) are intended to remove the requirement for a multiple-dose final product to be packaged with only one vial of diluent. The commenter stated, however, that the last sentence as proposed requires “a carton or enclosure in order to provide all information required under the regulations.”

The regulatory provisions are intended to allow multiple containers in one carton if the container labels contain all the information required by regulations. If the containers do not have all the information, and instead rely on a carton or enclosure for additional information, then the containers must continue to be packaged one per carton to ensure complete labeling for each product unit.

Special Additional Requirements

One commenter stated that the proposed revisions to § 112.7(f) would require a pregnancy warning on all modified live and inactivated vaccines for use in mammals unless the vaccine has been shown to be safe in pregnant animals. The commenter stated that this requirement should be applied only to new products and to products with antigens recognized as having a risk in pregnant animals. The commenter stated further that these changes should be applied only prospectively as the labeling for such products are otherwise modified.

APHIS believes that it is appropriate for the label to convey information on whether or not the product has been tested in pregnant animals in order to convey meaningful care information regarding the health of the fetus. We have amended the required statement to read “This product has not been tested in pregnant animals” and we will continue to allow equivalent statements acceptable to APHIS. As a result of editorial changes made to § 112.7, these requirements now appear in paragraph (e).

One commenter stated that the preamble of the proposed rule states that the regulations would require labeling to bear the following statement: “A specific revaccination schedule has not been established for this product; consultation with a veterinarian is recommended.” The commenter agreed that this is an appropriate label statement, but noted that the actual language proposed is different, stating “The need for annual booster vaccinations has not been established for this product.” The commenter requested that the language be amended to allow for the use of equivalent statements and to be provided in an enclosure or other location, with an appropriate reference to the location, when space is limited on labels or outer packaging. The commenter stated that this would allow flexibility to tailor statements where necessary to meet differences unique to species and/or antigens. Another commenter stated that the requirement for a revaccination statement should only be applied prospectively as the labeling for such products is otherwise modified.

APHIS has amended the regulatory text to agree with the preamble, as the latter is more inclusive. We disagree that the requirement should be applied prospectively. Having two standards for the information that appears on labels would be confusing to the public and to the industry.

Miscellaneous Changes

Three commenters asked that the implementation schedule be changed from 3 years to 5 years. One commenter stated that the proposed changes have in most cases been under discussion for more than a decade, which argues against the need for urgency in the implementation of the new requirements. This commenter stated further that APHIS underestimates the magnitude of the tasks required to implement the changes.

APHIS notes that a recent final rule (80 FR 39669-39675, Docket No. APHIS-2011-0049), which amended the regulations to provide for the use of a simpler labeling format, provided for a 4-year phase-in of the labeling and data summary requirements, with additional extensions of up to 2 years allowed under certain conditions. In order to be consistent with that rule and to minimize sequential label changes, we will also adopt a 4-year phase-in of the packaging and labeling requirements in this rule, with additional extensions of up to 2 years allowed under certain conditions. As we explained in that final rule, we intend to implement that rule and this one concurrently, and we will coordinate implementation with industry.

Section 103.3(d) currently requires that a request for authorization to ship an unlicensed biological product for experimental study include, among other things, two copies of labels or label sketches which show the name or identification of the product and bear the statement “Notice! For experimental use only—Not For Sale” or equivalent statement. However, most applicants submit these requests electronically, and those that still arrive on paper are scanned upon receipt. The requirement that two copies be submitted is no longer necessary, and we are amending this paragraph to require only one copy of the labels or label sketches.

We are amending § 112.5(a) to indicate that transmittal forms to be used with submissions of sketches and labels may be found on the APHIS Web page.

We proposed to amend § 112.7(j)(1) and (2) to require that all but very small final container labels for feline panleukopenia vaccines contain recommendations for use. Specifically, we would have required that these recommendations state that for healthy cats vaccinated at less than 12 weeks of age, a second dose of the vaccine should be given at 12 to 16 weeks of age. Since the proposed rule was published, however, research has shown that the booster for the feline panleukopenia vaccine should not be given earlier than 16 weeks. Therefore we are amending the requirements in new paragraphs (i)(1) and (2) to read “. . . a second dose should be given no earlier than 16 weeks of age.”

We are amending § 113.206(d)(2) to update a reference to labeling requirements that now appear in § 112.7(h).

Issues Outside the Scope of the Rulemaking

One commenter stated that the current “true name” system fails to uniquely and accurately identify products. The commenter stated that the system should be changed to correct this problem but did not specify how.

We did not propose to make any changes to the true name system in this rulemaking. We are aware of issues associated with the current system and will consider addressing this issue in a future action.

One commenter asked that APHIS remove the restriction upon the use of trade names for conditionally licensed products. Two commenters requested changes to § 112.8(c), which sets out requirements for labels on shipping containers of products for export. These issues are outside the scope of this rulemaking.

Therefore, for the reasons given in the proposed rule and in this document, we are adopting the proposed rule as a final rule, with the changes discussed in this document.

Executive Orders 12866 and 13563 and Regulatory Flexibility Act

This final rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget.

We have prepared an economic analysis for this rule. The economic analysis provides a cost-benefit analysis, as required by Executive Orders 12866 and 13563, which direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. The economic analysis also provides a final regulatory flexibility analysis that examines the potential economic effects of this rule on small entities, as required by the Regulatory Flexibility Act. The economic analysis is summarized below. Copies of the full analysis are available on the Regulations.gov Web site (see footnote 1 in this document for a link to Regulations.gov) or by contacting the person listed under FOR FURTHER INFORMATION CONTACT.

APHIS is amending the Virus-Serum-Toxin Act regulations regarding the packaging and labeling requirements for veterinary biologics products. Most of the changes are intended to increase the information readily available to consumers (such as veterinarians, livestock and dairy producers, pet stores, and animal health technicians). These changes are necessary to update and clarify labeling requirements for veterinary biologics licensees (manufacturers of veterinary biologics) and permittees (importers of veterinary biologics) to ensure that information provided in labeling is accurate with regard to the expected performance of the product.

This action will affect all veterinary biologics product licensees and permittees. Currently, there are approximately 100 veterinary biological establishments, including permittees, and the majority of them are small entities. These companies produce about 1,900 different products, and there are about 11,700 active approved labels for veterinary biologics. There were about 3,100 labels submitted for approval from June 2012 through May 2013 by about two-thirds of the companies. The average number of labels submitted per company over that time frame was 46 and the medianwas 8.

The veterinary biologics industry has grown substantially in the United States in recent years; the Census Bureau's Annual Survey of Manufacturers (ASM) reports that the annual shipment value of veterinary biological products increased by $2.06 billion (or 88 percent) from $2.34 billion in 2006 to $4.40 billion in 2010 and have been stable at around $4.33 to $4.60 billion from 2010 to 2014. In 2015, the United States exported about $1.2 billion and imported about $0.9 billion of veterinary biologic products, including exports and imports of veterinary medicaments which were packaged for retail sale.

The action will benefit consumers of veterinary biologic products and, ultimately, the animals they treat with those products. This is because the action aims to ensure that consumers have complete and up-to-date instructions for the proper use of those products, including vaccination schedules, warnings, and cautions.

We anticipate that the costs associated with this rule will be one-time costs to the industry that will overlap with the expected one-time costs of the single label claim rule (80 FR 39669-39675, Docket No. APHIS-2011-0049), which became effective on September 8, 2015. APHIS is allowing the manufacturers to delay implementing the single label claim rule until this rule becomes effective, so that the required label revisions by these two rules are being carried out concurrently. As addressed in the economic analysis of the single label claim rule, we expect the industry's one-time implementation costs associated with the labeling changes in these two rules will fall between about $1.1 million and $4.1 million, with a median estimate of about $2.4 million. Labor costs to plan and implement the required changes (about one-third of the total) and material costs for labeling and packaging (about 40 percent of the total) are key cost components. Other costs are: Label designing (about 20 percent of the total) and standardized summaries for efficacy and safety that are necessary for the single label claim rule (about 6 percent of the total, based on the median cost estimate). We expect that the costs for the industry will not cause significant economic impacts for most veterinary biologics licensees and permittees, and the benefits of this rule justify the costs.

Executive Order 12372

This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 2 CFR chapter IV.)

Executive Order 12988

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. This rule will not preempt any State or local laws, regulations, or policies where they are necessary to address local disease conditions or eradication programs. However, where safety, efficacy, purity, and potency of biological products are concerned, it is the Agency's intent to occupy the field. This includes, but is not limited to, the regulation of labeling. Under the Act, Congress clearly intended that there be national uniformity in the regulation of these products. There are no administrative proceedings which must be exhausted prior to a judicial challenge to the regulations under this rule.

Executive Order 13175

This rule has been reviewed in accordance with the requirements of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments.” Executive Order 13175 requires Federal agencies to consult and coordinate with tribes on a government-to-government basis on policies that have tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects 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.

The Animal and Plant Health Inspection Service has assessed the impact of this rule on Indian tribes and determined that this rule does not, to our knowledge, have tribal implications that require tribal consultation under Executive Order 13175.

Paperwork Reduction Act

There are information collection activities in this rule. Therefore, in accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), we published a notice 2 in the Federal Register (80 FR 59725, Docket No. APHIS-2015-0066), announcing our intention to initiate this information collection to solicit comments. We are asking the Office of Management and Budget (OMB) to approve our use of this information collection for 3 years. When OMB notifies us of its decision, we will publish a document in the Federal Register providing notice of the assigned OMB control number.

2 To view the notice, go to http://www.regulations.gov/#!docketDetail;D=APHIS-2015-0066.

E-Government Act Compliance

The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this rule, please contact Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at (301) 851-2727.

List of Subjects 9 CFR Part 101

Animal biologics.

9 CFR Parts 103 and 114

Animal biologics, Reporting and recordkeeping requirements.

9 CFR Part 112

Animal biologics, Exports, Imports, Labeling, Packaging and containers, Reporting and recordkeeping requirements.

9 CFR Part 113

Animal biologics, Exports, Imports, Reporting and recordkeeping requirements.

Accordingly, we are amending 9 CFR parts 101, 103, 112, 113, and 114 as follows:

PART 101—DEFINITIONS 1. The authority citation for part 101 continues to read as follows: Authority:

21 U.S.C. 151-159; 7 CFR 2.22, 2.80, and 371.4.

2. In § 101.3, paragraph (q) is added to read as follows:
§ 101.3 Biological products and related terms.

(q) Combination package. Biological product consisting of two or more licensed biological products. Each completed product in final container is packaged together and mixed prior to administration. A combination package is issued a separate U.S. Veterinary Biological Product License and assigned a product code number to distinguish it from its component products, which also may be marketed individually unless otherwise restricted.

PART 103—EXPERIMENTAL PRODUCTION, DISTRIBUTION, AND EVALUATION OF BIOLOGICAL PRODUCTS PRIOR TO LICENSING 3. The authority citation for part 103 continues to read as follows: Authority:

21 U.S.C. 151-159; 7 CFR 2.22, 2.80, and 371.4.

4. In § 103.3, paragraph (d) is revised to read as follows:
§ 103.3 Shipment of experimental biological products.

(d) A copy of the labels or label sketches which show the name or identification of the product and bear the statement “Notice! For experimental use only-Not For Sale” or equivalent. Such statement shall appear on final container labels, except that it may appear on the carton in the case of very small final container labels and labeling for diagnostic test kits. The U.S. Veterinary License legend shall not appear on such labels; and

PART 112—PACKAGING AND LABELING 5. The authority citation for part 112 continues to read as follows: Authority:

21 U.S.C. 151-159; 7 CFR 2.22, 2.80, and 371.4.

6. Section 112.2 is amended as follows: a. By revising paragraphs (a)(1), (a)(2), (a)(3), (a)(4), (a)(5), (a)(7), and (a)(10). b. At the end of paragraphs (a)(6) and (a)(9)(iv), by removing the semicolon and adding a period in its place. c. By revising paragraphs (d)(3), (e), and (f).

The revisions read as follows:

§ 112.2 Final container label, carton label, and enclosure.

(a) * * *

(1) The complete true name of the biological product which name shall be identical with that shown in the product license under which such product is prepared or the permit under which it is imported, shall be prominently lettered and placed giving equal emphasis to each word composing it. Descriptive terms used in the true name on the product license or permit shall also appear. Abbreviations of the descriptive terms may be used on the final container label if complete descriptive terms appear on the carton label and enclosure. The following exceptions are applicable to small final containers, and containers of interchangeable reagents included in diagnostic test kits:

(i) For small final containers, an abbreviated true name of the biological product, which shall be identical with that shown in the product license under which the product is prepared or the permit under which it is imported, may be used: Provided, That the complete true name of the product must appear on the carton label and enclosures;

(ii) In addition to the true name of the kit, the functional and/or chemical name of the reagent must appear on labeling for small final containers of reagents included in diagnostic kits: Provided, That the true name is not required on labeling for small final containers of interchangeable (non-critical) components of diagnostic kits.

(2) For biological product prepared in the United States or in a foreign country, the name and address of the producer (licensee, or subsidiary) or permittee and of the foreign producer, and an appropriate consumer contact telephone number: Provided, That in the case of a biological product exported from the United States in labeled final containers, a consumer contact telephone number is not required; however, small single dose containers marketed in the United States must include contact telephone information on carton and enclosures.

(3) The United States Veterinary Biologics Establishment License Number (VLN) or the United States Veterinary Biological Product Permit Number (VPN), and the Product Code Number (PCN) assigned by the Department, which shall be shown only as “VLN/PCN” and “VPN/PCN,” respectively, except that:

(i) Only the VLN or VPN is required on container labels of interchangeable (non-critical) components of diagnostic kits and container labels for individual products packaged together for co-administration.

(ii) The PCN may be used in lieu of the true name of the kit on small container labels for critical components of diagnostic kits.

(iii) Container labels for individually licensed biological products, when marketed as components of combination packages, must include a statement referring the consumer to the carton or enclosure for the PCN of the combination package.

(4) Storage temperature recommendation for the biological product stated as 2 to 8 °C or 35 to 46 °F, or both.

(5) Full instructions for the proper use of the product, including indications for use, target species, minimum age of administration, route of administration, vaccination schedule, product license restriction(s) that bear on product use, warnings, cautions, and any other vital information for the product's use; except that in the case of limited space on final container labels, a statement as to where such information is to be found, such as “See enclosure for complete directions,” “Full directions on carton,” or comparable statement.

(7) The following warning statements, or equivalent statements, shall appear on the labeling as applicable:

(i) Products other than diagnostic kits: “Do not mix with other products, except as specified on this label.”

(ii) Injectable products and other products containing hazardous components: “In case of human exposure, contact a physician.”

(iii) Products containing viable organisms: “Inactivate unused contents before disposal.”

(10) In the case of a product that contains a preservative that is added during the production process and is not reduced to undetectable levels in the completed product through the production process, the statement “Contains [name of preservative] as a preservative” or an equivalent statement must appear on cartons and enclosures, if used. If cartons are not used, such information must appear on the final container label.

(d) * * *

(3) The statement “For use in animals only” may appear on the labeling as appropriate for a product to indicate that the product is recommended specifically for animals and not for humans.

(e) When label requirements of a foreign country differ from the requirements as prescribed in this part, special labels may be approved by APHIS for use on biological products to be exported to such country upon receipt of written authorization, acceptable to APHIS, from regulatory officials of the importing country, provided that:

(1) If the labeling contains claims or indications for use not supported by data on file with APHIS, the special labels for export shall not bear the VLN.

(2) All other labels for export shall bear the VLN unless the importing country provides documentation that the VLN is specifically prohibited. When laws, regulations, or other requirements of foreign countries require exporters of biological products prepared in a licensed establishment to furnish official certification that such products have been prepared in accordance with the Virus-Serum-Toxin Act and regulations issued pursuant to the Act, such certification may be made by APHIS.

(f) Multiple-dose final containers of liquid biological product and carton tray covers showing required labeling information are subject to the requirements in this paragraphs.

(1) If a carton label or an enclosure is required to complete the labeling for a multiple-dose final container of liquid biological product, only one final container, with a container of diluent if applicable, shall be packaged in each carton: Provided, That if the multiple-dose final container is fully labeled without a carton label or enclosure, two or more final containers, and a corresponding number of diluent containers, may be packaged in a single carton which shall be considered a shipping box. Labels or stickers for shipping boxes shall not contain false or misleading information, but need not be submitted to APHIS for approval.

(2) When required labeling information is shown on a carton tray cover, it must be printed on the outside face of such tray cover where it may be read without opening the carton. The inside face of the tray cover may contain information suitable for an enclosure.

7. In § 112.3, paragraph (f)(2) is revised to read as follows:
§ 112.3 Diluent labels.

(f) * * *

(2) The biological product is composed of viable or dangerous organisms or viruses, the notice, “Inactivate unused contents before disposal.”

8. Section 112.5 is amended as follows: a. In paragraph (a), by removing the words “available on the Internet at (http://www.aphis.usda.gov/animalhealth/cvb/forms)” and adding in their place the words “available on the APHIS Web page at http://www.aphis.usda.gov/animalhealth/cvb/forms”. b. By revising paragraphs (d)(2)(ii) and (d)(2)(v), and at the end of paragraph (d)(2)(vi), by removing the period and adding a semicolon in its place. c. By adding paragraphs (d)(2)(vii) through (d)(2)(x). d. By revising paragraphs (e)(1)(iii), (e)(1)(iv), (e)(4), and (f)(1). e. By removing paragraph (f)(2) and redesignating paragraph (f)(3) as new paragraph (f)(2).

The additions and revisions read as follows:

§ 112.5 Review and approval of labeling.

(d) * * *

(2) * * *

(ii) Changes in the color of label print or background, provided that such changes do not affect the legibility of the label;

(v) Adding, changing, deleting, or repositioning label control numbers, universal product codes, or other inventory control numbers;

(vii) Changing the telephone contact number;

(viii) Adding, changing, or deleting an email and/or Web site address;

(ix) Changing the establishment license or permit number assigned by APHIS, and/or changing the name and/or address of the manufacturer or permittee, provided that such changes are identical to information on the current establishment license or permit; and

(x) Adding or changing the name and/or address of a distributor.

(e) * * *

(1) * * *

(iii) For finished labels, submit two copies of each finished final container label, carton label, and enclosure: Provided, That when an enclosure is to be used with more than one product, one extra copy shall be submitted for each additional product. One copy of each finished label will be retained by APHIS. One copy will be stamped and returned to the licensee or permittee. Labels to which exceptions are taken shall be marked as sketches and handled under paragraph (e)(1)(i) of this section.

(iv) For finished master labels, submit for each product two copies each of the enclosure and the labels for the smallest size final container and carton. Labels for larger sizes of containers or cartons of the same product that are identical, except for physical dimensions, need not be submitted. Such labels become eligible for use concurrent with the approval of the appropriate finished master label, provided that the marketing of larger size final containers is approved in the filed Outline of Production, and the appropriate larger sizes of containers or cartons are identified on the label mounting sheet. When a master label enclosure is to be used with more than one product, one extra copy for each additional product shall be submitted. One copy of each finished master label will be retained by APHIS. One copy will be stamped and returned to the licensee or permittee. Master labels to which exception are taken will be marked as sketches and handled under paragraph (e)(1)(ii) of this section.

(4) To appear on the bottom of each page in the lower left hand corner, if applicable:

(i) The dose size(s) to which the master label applies.

(ii) The APHIS assigned number for the label or sketch to be replaced.

(iii) The APHIS assigned number for the label to be used as a reference for reviewing the submitted label.

(f) * * *

(1) An accurate English translation must accompany each foreign language label submitted for approval. A statement affirming the accuracy of the translation must also be included.

9. In § 112.6, paragraph (a) is revised to read as follows:
§ 112.6 Packaging biological products.

(a) Multiple-dose final containers of a biological product with final container labeling including all information required under the regulations may be packaged one or more per carton with a container(s) of the proper volume of diluent, if required, for that dose as specified in the filed Outline of Production: Provided, That cartons containing more than one final container of product must comply with the conditions set forth in paragraphs (c)(1) through (4) of this section. Multiple-dose final containers of a product that require a carton or enclosure in order to provide all information required under the regulations shall be packaged one container per carton with the proper volume of diluent, if required, for that dose as specified in the filed Outline of Production.

10. Section 112.7 is amended as follows: a. By revising paragraphs (e), (f), (i), and (l). b. By adding paragraph (n).

The addition and revisions read as follows:

§ 112.7 Special additional requirements.

(e) Labeling for all products for use in mammals must bear an appropriate statement concerning use in pregnant animals.

(1) For bovine rhinotracheitis vaccine or bovine virus diarrhea vaccine containing modified live virus, all labeling except small final container labels shall bear the following statement: “Do not use in pregnant cows or in calves nursing pregnant cows.”: Provided, That such vaccines which have been shown to be safe for use in pregnant cows may be excepted from this label requirement by the Administrator.

(2) For other modified live and inactivated vaccine, labeling shall bear a statement appropriate to the level of safety that has been demonstrated in pregnant animals.

(i) Products known to be unsafe in pregnant animals shall include statements such as “Do not use in pregnant animals,” or “Unsafe for use in pregnant animals,” or an equivalent statement acceptable to APHIS.

(ii) Products without safety documentation acceptable to APHIS, but not known to be unsafe, labeling shall include the statement “This product has not been tested in pregnant animals” or an equivalent statement acceptable to APHIS.

(3) For modified live vaccines containing agents with potential reproductive effects but having acceptable pregnant animal safety data on file with APHIS, labeling still must bear the following statement concerning residual risk: “Fetal health risks associated with the vaccination of pregnant animals with this vaccine cannot be unequivocally determined during clinical trials conducted for licensure. Appropriate strategies to address the risks associated with vaccine use in pregnant animals should be discussed with a veterinarian.”

(f) For biological products recommending annual booster vaccinations, such recommendations must be supported by data acceptable to APHIS. In the absence of data that establish the need for booster vaccination, labeling must bear the following statement: “The need for annual booster vaccinations has not been established for this product; consultation with a veterinarian is recommended.”

(i) All but very small final container labels for feline panleukopenia vaccines shall contain the following recommendations for use:

(1) Killed virus vaccines. Vaccinate healthy cats with one dose, except that if the animal is less than 12 weeks of age, a second dose should be given no earlier than 16 weeks of age.

(2) Modified live virus vaccines. Vaccinate healthy cats with one dose, except that if the animal is less than 12 weeks of age, a second dose should be given no earlier than16 weeks of age.

(l) All labels for autogenous biologics must specify the name of the microorganism(s) or antigen(s) that they contain, and shall bear the following statement: “Potency and efficacy of autogenous biologics have not been established. This product is prepared for use only by or under the direction of a veterinarian or approved specialist.”

(n) All labels for conditionally licensed products shall bear the following statement: “This product license is conditional; efficacy and potency have not been fully demonstrated.”

PART 113—STANDARD REQUIREMENTS 11. The authority citation for part 113 continues to read as follows: Authority:

21 U.S.C. 151-159; 7 CFR 2.22, 2.80, and 371.4.

§ 113.206 [Amended]
12. In § 113.206, paragraph (d)(2) is amended by removing the reference “§ 112.7(i)” and adding the reference “§ 112.7(h)” in its place.
PART 114—PRODUCTION REQUIREMENTS FOR BIOLOGICAL PRODUCTS 13. The authority citation for part 114 continues to read as follows: Authority:

21 U.S.C. 151-159; 7 CFR 2.22, 2.80, and 371.4.

14. Section 114.11 is revised to read as follows:
§ 114.11 Storage and handling.

Biological products at licensed establishments must be protected at all times against improper storage and handling. Completed product must be kept under refrigeration at 35 to 46 °F (2 to 8 °C), unless the inherent nature of the product makes storage at different temperatures advisable, in which case, the proper storage temperature must be specified in the filed Outline of Production. All biological products to be shipped or delivered must be securely packed.

Done in Washington, DC, this 24th day of August 2016. Elvis S. Cordova, Deputy Under Secretary for Marketing and Regulatory Programs.
[FR Doc. 2016-20749 Filed 8-29-16; 8:45 am] BILLING CODE 3410-34-P
DEPARTMENT OF ENERGY 10 CFR Part 590 Notice of Revised Procedures Affecting Applications and Authorizations for the In-Transit Movement of Natural Gas AGENCY:

Office of Fossil Energy, DOE.

ACTION:

Notice of procedures.

SUMMARY:

Pursuant to section 3(a) of the Natural Gas Act (NGA), no person may import or export natural gas without authorization from the Department of Energy (DOE), and DOE will approve such imports or exports unless, after opportunity for a hearing, it determines that the imports or exports are not consistent with the public interest. Section 3(c) of the NGA provides that imports and exports of natural gas from or to countries with which the United States has entered into a free trade agreement (FTA) providing for national treatment for trade in natural gas (FTA countries), and all imports of liquefied natural gas (LNG) from any country, are deemed in the public interest and must be granted without modification or delay. This notice serves to clarify that in-transit shipments of natural gas, i.e., shipments of natural gas that only temporarily pass through the United States before returning to their country of origin, or temporarily pass through a foreign country before returning to the United States, for consumption or other disposition, are not “imports” or “exports” within the meaning of section 3 of the Natural Gas Act. However, DOE will impose monthly reporting requirements on persons making such shipments in order to ensure these movements meet the criteria defining in-transit shipments, and are tracked accordingly.

DATES:

Effective August 30, 2016.

FOR FURTHER INFORMATION CONTACT:

Brian Lavoie or Larine Moore, U.S. Department of Energy (FE-34), Office of Regulation and International Engagement, Office of Fossil Energy, Forrestal Building, Room 3E-042, 1000 Independence Avenue SW., Washington, DC 20585, (202) 586-2459; (202) 586-9478. Edward Myers, U.S. Department of Energy (GC-76), Office of the Assistant General Counsel for Electricity and Fossil Energy, Forrestal Building, 1000 Independence Avenue SW., Washington, DC 20585, (202) 586-3397. SUPPLEMENTARY INFORMATION:

I. Background

In DOE/FE Order No. 3769,1 DOE concluded that “Congress likely did not intend the words “import” and “export” to capture any movement of natural gas across the U.S. border, but rather intended to leave some discretion to the Federal Power Commission (the [DOE's] predecessor in administering NGA Section 3, 15 U.S.C. 717b) on that question.” 2 Further, DOE concluded that “in-transit shipments returning to the country of origin are not imports or exports within the meaning of section 3 of the Natural Gas Act.” 3 Consequently, DOE concluded “that in-transit shipments returning to the country of origin fall outside [DOE's] jurisdiction under NGA section 3.” 4 This Notice sets forth procedures for the submission of information concerning in-transit shipments returning to the country of origin.

1Bear Head LNG Corporation & Bear Head LNG, LLC, DOE/FE Order No. 3769, FE Docket No. 15-14-NG, Opinion and Order Dismissing Application for In-Transit Shipments of Canadian-Sourced Natural Gas and Directing Submission of Information Concerning In-Transit Shipments Returning to the Country of Origin (Feb. 5, 2016).

2Id. at 8.

3Id. at 9.

4Id. at 10.

DOE considers an “in-transit shipment returning to the country of origin” as a shipment of natural gas through the United States between points of a single foreign nation, or through a single foreign nation between points in the United States, that are physical and direct. “Physical” means that the natural gas will be transported between two cross-border points. Thus, exchanges by backhaul or displacement, or other virtual shipments, do not qualify as in-transit shipments for purposes of this Order. “Direct” means that the natural gas must not be diverted for other purposes but must travel a commercially reasonable path between points in one country consistent with an intention merely to transit the other country. And, consistent with the U.S. Customs and Border Patrol regulations concerning in-transit shipments,5 to qualify as “in-transit” the natural gas must cross points of entry and exit at the United States border within a 30-day period. DOE expects the reporting of in-transit volumes—noting any line losses and/or natural gas that may be consumed as fuel during the transit process—to be made to the Department within 30 days following the month during which the in-transit shipment took place. The purpose of reporting the in-transit volumes is to confirm the non-jurisdictional status of such shipments and to understand the extent to which imports and exports are affecting the domestic natural gas market, and what movements of natural gas are limited to utilizing natural gas infrastructure and not directly impacting natural gas supply or demand. Additional information on reporting volumes is available at: http://energy.gov/fe/services/natural-gas-regulation/guidelines-filing-monthly-reports.

5See 19 CFR 18.31, 18.2(c)(2).

II. Reporting Requirements for In-Transit Shipments of Natural Gas

a. The entity holding title to the natural gas as it crosses borders shall file with the Office of Regulation and International Engagement, a report due not later than the 30th day of the month following the month of completion of an in-transit shipment. The report must give the following details of each in-transit shipment returning to the country of origin, including cases where natural gas originates from the United States and undergoes in-transit shipment and where natural gas originates in another country and transits the United States: (1) The name of the country that is both the origin and final destination, (2) the name of the country through which the gas is transported before returning to the origin country (the transit country—this may be either the United States or another country) (3) the initial border crossing point, (4) the foreign pipeline at the initial border crossing point, (5) the U.S. pipeline at the initial border crossing point, (6) the final border crossing point, (7) the foreign pipeline at the final border crossing point, (8) the U.S. pipeline at the final border crossing point, (9) the volume of natural gas moving through the final border crossing point, (10) the month and year in which the in-transit shipment took place, (11) the name of the entity that has title to the natural gas during the in-transit movement, (12) the name of the individual who prepared the report, and (13) contact information.

(Approved by the Office of Management and Budget under OMB Control No. 1901-0294.)

b. To show that no deliveries into or out of United States commercial markets have occurred, DOE/FE additionally requests clarification in monthly reports for in-transit shipments specifying the difference in volumes entering the transit country and volumes leaving the transit country and the reason for any such differences, to the extent the information is available.

c. The entity holding title to the natural gas as it crosses borders shall maintain copies of the reports filed under paragraph a., supra, for each in-transit shipment returning to the country of origin for a period of one year after completion of the in-transit shipment, and provide that information to DOE/FE upon request.

d. All monthly report filings shall be made to U.S. Department of Energy (FE-34), Office of Fossil Energy, Office of Regulation and International Engagement, P.O. Box 44375, Washington, DC 20026-4375, Attention: Natural Gas Reports. Alternatively, reports may be emailed to [email protected], or may be faxed to Natural Gas Reports at (202) 586-6050.

e. Companies that currently use import and export authorizations to report in-transit natural gas shipments may continue to report under their authorizations, but no new authorizations dedicated solely to in-transit shipments will be issued. Companies should not apply for new import and export authorizations if they plan on only conducting in-transit natural gas transactions.

f. Companies may use approved OMB information collection forms, which will be available on DOE/FE's Web site at: http://www.energy.gov/fe/services/natural-gas-regulation/in-transit.

g. Companies can submit in-transit reports without docket or order numbers, if not reporting under authorizations permitting both imports and exports.

This Notice is effective immediately upon issuance.

Issued in Washington, DC, on August 23, 2016. John A. Anderson, Director, Office of Regulation and International Engagement, Office of Oil and Natural Gas. [FR Doc. 2016-20802 Filed 8-29-16; 8:45 am] BILLING CODE 6450-01-P
FARM CREDIT SYSTEM INSURANCE CORPORATION 12 CFR Part 1402 RIN 3055-AA12 Releasing Information; Availability of Records of the Farm Credit System Insurance Corporation; Fees for Provision of Information AGENCY:

Farm Credit System Insurance Corporation.

ACTION:

Final rule.

SUMMARY:

The Farm Credit System Insurance Corporation (Corporation) issues a final rule amending its regulations to reflect changes to the Freedom of Information Act (FOIA). The FOIA Improvement Act of 2016 requires the Corporation to amend its FOIA regulations to extend the deadline for administrative appeals, to add information on dispute resolution services, and to amend the way the Corporation charges fees.

DATES:

Effective date: This regulation will become effective October 1, 2016.

FOR FURTHER INFORMATION CONTACT:

Howard Rubin, General Counsel, Farm Credit System Insurance Corporation, 1501 Farm Credit Drive, McLean, Virginia 22102, (703) 883-4380, TTY (703) 883-4390.

SUPPLEMENTARY INFORMATION: I. Objective

The objective of this final rule is to reflect changes to the FOIA by the FOIA Improvement Act of 2016 (Improvement Act). The Improvement Act addresses a range of procedural issues, including requirements that agencies establish a minimum of 90 days for requesters to file an administrative appeal and that they provide dispute resolution services at various times throughout the FOIA process. The Improvement Act also updates how fees are assessed.

We revise the regulations as follows:

(1) In § 1402.14,

a. By changing the appeals deadline from 30 days to 90 days in paragraph (b);

b. By adding FCSIC's FOIA Public Liaison and the Office of Government Information Services to the list of offices available to offer dispute resolution services in paragraph (b); and

(2) In § 1402.22, by redesignating existing paragraph (h) as paragraph (k) and adding new paragraphs (h), (i), and (j) with updated information about charging fees.

II. Certain Findings

We have determined that the amendments mandated by the Improvement Act involve agency management and technical changes. Therefore, the amendments do not constitute a rulemaking under the Administrative Procedure Act (APA), 5 U.S.C. 551, 553(a)(2). Under the APA, the public may participate in the promulgation of rules that have a substantial impact on the public. The amendments to our regulations relate to agency management and technical changes only and are required by statute, and therefore, do not require public participation.

Even if these amendments were a rulemaking under 5 U.S.C. 551, 553(a)(2) of the APA, we have determined that notice and public comment are unnecessary and contrary to the public interest. Under 5 U.S.C. 553(b)(B) of the APA, an agency may publish regulations in final form when the agency for good cause finds that notice and public procedure thereon are impracticable, unnecessary, or contrary to public interest. The proposed amendments are required by statute, do not involve Corporation discretion, and provide additional protections to the public through the existing regulations. Thus, notice and public procedure are impracticable, unnecessary, and contrary to the public interest.

III. Regulatory Flexibility Act

Pursuant to section 605(b) of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), the Corporation hereby certifies that the final rule will not have a significant economic impact on a substantial number of small entities.

List of Subjects in 12 CFR Part 1402

Archives and records, Freedom of information, Insurance.

As stated in the preamble, part 1402 of chapter XIV, title 12 of the Code of Federal Regulations is amended as follows:

PART 1402—RELEASING INFORMATION 1. The authority citation for part 1402 is revised to read as follows: Authority:

Secs. 5.58, 5.59 of Pub. L. 92-181, 85 Stat. 583 (12 U.S.C. 2277a-7, 2277a-8); 5 U.S.C. 552; 52 FR 10012; E.O. 12600, 52 FR 23781, 3 CFR, 1987 Comp., p. 235.

Subpart B—Availability of Records of the Farm Credit System Insurance Corporation 2. Section 1402.14(b) is revised to read as follows:
§ 1402.14 Response to requests for records.

(b) Within 90 days of the receipt of a notice denying, in whole or in part, a request for records, the requester may appeal the denial. The appeal shall be in writing addressed to the Chief Financial Officer, Farm Credit System Insurance Corporation, McLean, Virginia 22102, and both the letter and envelope shall clearly be marked “FOIA Appeal.” An appeal improperly addressed shall be deemed not to have been received for purposes of the 20-day time period set forth in paragraph (c) of this section until it is received, or would have been received with the exercise of due diligence by Farm Credit System Insurance Corporation personnel. You also have the right to seek dispute resolution services from the Corporation's FOIA Public Liaison, McLean, Virginia 22102, and the Office of Government Information Services, National Archives and Records Administration, 8601 Adelphi Road—OGIS, College Park, Maryland 20740-6001.

Subpart C—Fees for Provision of Information 3. Section 1402.22 is amended by redesignating paragraph (h) as paragraph (k) and adding new paragraphs (h), (i), and (j) to read as follows:
§ 1402.22 Fees to be charged.

(h) We will not assess fees if we fail to comply with any time limit under the FOIA or these regulations, and have not timely notified the requester, in writing, that an unusual circumstance exists. If an unusual circumstance exists, and timely, written notice is given to the requester, we may be excused an additional 10 working days before fees are automatically waived under this paragraph (h).

(i) If we determine that unusual circumstances apply and more than 5,000 pages are necessary to respond to a request, we may charge fees if we provided a timely, written notice to the requester and discussed with the requester via mail, Email, or telephone (or made at least three good faith attempts to do so) how the requester could effectively limit the scope of the request.

(j) If a court has determined that exceptional circumstances exist, a failure to comply with time limits imposed by these regulations or FOIA shall be excused for the length of time provided by court order.

Dated: August 24, 2016. Dale L. Aultman, Secretary to the Board, Farm Credit System Insurance Corporation.
[FR Doc. 2016-20767 Filed 8-29-16; 8:45 am] BILLING CODE 6710-01-P
DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Parts 415 and 417 [Docket No. FAA-2000-7953; Amdt. No(s). 415-6 and 417-5] RIN 2120-AG37 Licensing and Safety Requirements for Launch; Technical Amendment AGENCY:

Federal Aviation Administration, DOT.

ACTION:

Final rule; technical amendment.

SUMMARY:

The FAA is publishing this action to correct minor, editorial errors in chapter III, parts 415 and 417. These errors occurred in the Licensing and Safety Requirements for Launch final rule, published in the Federal Register on August 25, 2006. That final rule amended the commercial space transportation regulations governing the launch of expendable launch vehicles to address licensing and safety requirements for a launch. In that final rule, the FAA inadvertently made minor errors, which this technical amendment corrects.

DATES:

Effective August 30, 2016.

FOR FURTHER INFORMATION CONTACT:

For questions concerning this action contact René Rey, Regulations and Analysis Division, AST-300, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267-7538; email [email protected]

SUPPLEMENTARY INFORMATION:

Good Cause for Immediate Adoption Without Prior Notice

Section 553(b)(3)(B) of the Administrative Procedure Act (APA) (5 U.S.C. 551 et seq.) authorizes agencies to dispense with notice and comment procedures for rules when the agency for “good cause” finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under this section, an agency, upon finding good cause, may issue a final rule without seeking comment prior to the rulemaking.

Section 553(d)(3) of the Administrative Procedure Act requires that agencies publish a rule not less than 30 days before its effective date, except as otherwise provided by the agency for good cause found and published with the rule.

This document is correcting errors that are in 14 CFR 415.35, 415.37, 415.41, 415.55, 417.15, 417.107, 417.121, 417.231, 417.301, 417.303, 417.305, and Appendix A, Appendix E, and Appendix I to part 417. These corrections will not impose any additional restrictions on the persons affected by these regulations. Furthermore, any additional delay in making the regulations correct would be contrary to the public interest. Accordingly, the FAA finds that (i) public comment on these standards prior to promulgation is unnecessary, and (ii) good cause exists to make this rule effective in less than 30 days.

Background

On August 25, 2006, the FAA published a final rule entitled, “Licensing and Safety Requirements for Launch; Final Rule” (71 FR 50508).

In that final rule, the FAA amended commercial space transportation regulations governing the launch of expendable launch vehicles. That action was necessary to codify launch practices at Federal launch ranges and codify rules for launches from a non-Federal launch site. The intended effect of the action was to ensure that the public continued to be protected from the hazards of a launch from either a Federal launch range or a non-Federal launch site.

The final rule contains a more complete discussion of the rule and the events leading up to it.

Technical Amendment

The technical amendment makes the following corrections:

(1) In § 415.35(a), the reference to cc is changed to Ec.

(2) In § 415.37(a)(1), the reference to § 417.117(g) is changed to § 417.117(b)(3).

(3) In § 415.41, the reference to § 417.111(g) is changed to § 417.111(h).

(4) In § 415.55, the reference to § 415.79(a) is changed to § 417.17(b)(2).

(5) In § 417.15(b), the reference to § 405.1 is changed to § 401.5.

(6) In § 417.107(e)(2), the reference to § 417.113(b) is changed to § 417.113(c).

(7) In § 417.121(c), the reference to § 417.113(b) is changed to § 417.113(c).

(8) In § 417.231(a), the reference to § 417.113(b) is changed to § 417.113(c).

(9) In § 417.301(d)(1), duplicate sub-paragraph (1) is removed.

(10) In § 417.303(j), the reference to § 417.307(g) is changed to § 417.307(f).

(11) In § 417.305(c)(1), duplicate sub-paragraph (1) is removed.

(12) In Appendix A to part 417, section A417.29(b)(5), the reference to § 417.113(b) is changed to § 417.113(c).

(13) In Appendix E to part 417, section E417.19(e)(2)(vi), the reference to ±dB is changed to ±3 dB.

(14) In Appendix I to part 417, in the introductory paragraph to section I417.1, the reference to § 417.229 is changed to § 417.227.

(15) In Appendix I to part 417, section I417.5(a), the reference to § 417.113(b) is changed to § 417.113(c).

List of Subjects 14 CFR Part 415

Aviation safety, Environmental protection, Space transportation and exploration.

14 CFR Part 417

Aviation safety, Reporting and recordkeeping requirements, Rockets, Space transportation and exploration.

The Amendment

In consideration of the foregoing, the Federal Aviation Administration amends chapter III of title 14, Code of Federal Regulations as follows:

PART 415—LAUNCH LICENSE 1. The authority citation of part 415 continues to read as follows: Authority:

51 U.S.C. 50901-50923.

§ 415.35 [Amended]
2. Amend § 415.35(a) by removing the reference to “cc” and adding in its place “Ec”.
§ 415.37 [Amended]
3. Amend § 415.37(a)(1) by removing the reference to “§ 417.117(g)” and adding in its place “§ 417.117(b)(3)”.
§ 415.41 [Amended]
4. Amend § 415.41 by removing the reference to “§ 417.111(g)” and adding in its place “§ 417.111(h)”.
§ 415.55 [Amended]
5. Amend § 415.55 by removing the reference to “§ 415.79(a)” and adding in its place “§ 417.17(b)(2)”. PART 417—LAUNCH SAFETY 6. The authority citation for part 417 continues to read as follows: Authority:

51 U.S.C. 50901-50923.

§ 417.15 [Amended]
7. Amend § 417.15(b) by removing the reference to “§ 405.1” and adding in its place “§ 401.5”.
§ 417.107 [Amended]
8. Amend § 417.107(e)(2) by removing the reference to “§ 417.113(b)” and adding in its place “§ 417.113(c)”.
§ 417.121 [Amended]
9. Amend § 417.121(c) by removing the reference to “§ 417.113(b)” and adding in its place “§ 417.113(c)”.
§ 417.231 [Amended]
10. Amend § 417.231(a) by removing the reference to “§ 417.113(b)” and adding in its place “§ 417.113(c)”.
§ 417.301 [Amended]
11. Amend § 417.301 by removing duplicate paragraph (d)(1).
§ 417.303 [Amended]
12. Amend § 417.303(j) by removing the reference to “§ 417.307(g)” and adding in its place “§ 417.307(f)”.
§ 417.305 [Amended]
13. Amend § 417.305 by removing duplicate paragraph (c)(1). Appendix A to part 417 [Amended] 14. Amend section A417.29(b)(5) of Appendix A to part 417 by removing the reference to “§ 417.113(b)” and adding in its place “§ 417.113(c)”. Appendix E to part 417 [Amended] 15. Amend section E417.19(e)(2)(vi) of Appendix E to part 417 by removing the reference to “±dB” and adding in its place “±3 dB”. Appendix I to part 417 [Amended] 16. Amend Appendix I to part 417 by: a. In section I417.1, removing the reference to “§ 417.229” and adding in its place “§ 417.227”. b. In section I417.5(a), removing “§ 417.113(b)” and adding in its place “§ 417.113(c)”. Issued in Washington, DC, on August 23, 2016. Dale Bouffiou, Acting Director, Office of Rulemaking.
[FR Doc. 2016-20813 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 431 [Docket No. FAA-1999-5535; Amdt. No. 431-5] RIN 2120-AG71 Commercial Space Transportation Reusable Launch Vehicle and Reentry Licensing Regulations; Technical Amendment AGENCY:

Federal Aviation Administration, DOT.

ACTION:

Final rule; technical amendment.

SUMMARY:

The FAA is publishing this action to correct minor, editorial errors in chapter III, part 431. The errors occurred in the Commercial Space Transportation Reusable Launch Vehicle and Reentry Licensing Regulations final rule, published in the Federal Register on September 19, 2000. That final rule amended commercial space transportation regulations for the launch and reentry of reusable launch vehicles (RLVs) to establish operational requirements for launches of RLVs and to implement the FAA's reentry licensing authority by prescribing requirements for obtaining a license to launch and reenter an RLV, to reenter a reentry vehicle, and to operate a reentry site. In that final rule, the FAA inadvertently made minor errors, which this technical amendment corrects.

DATES:

Effective August 30, 2016.

FOR FURTHER INFORMATION CONTACT:

For questions concerning this action contact Stewart Jackson, Regulations and Analysis Division, AST-300, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267-7903; email [email protected]

SUPPLEMENTARY INFORMATION: Good Cause for Immediate Adoption Without Prior Notice

Section 553(b)(3)(B) of the Administrative Procedure Act (APA) (5 U.S.C. 551 et seq.) authorizes agencies to dispense with notice and comment procedures for rules when the agency for “good cause” finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under this section, an agency, upon finding good cause, may issue a final rule without seeking comment prior to the rulemaking.

Section 553(d)(3) of the Administrative Procedure Act requires that agencies publish a rule not less than 30 days before its effective date, except as otherwise provided by the agency for good cause found and published with the rule.

This document corrects errors in 14 CFR 431.79. These corrections will not impose any additional restrictions on the persons affected by these regulations. Furthermore, any additional delay in making the regulations correct would be contrary to the public interest. Accordingly, the FAA finds that (i) public comment on these standards prior to promulgation is unnecessary, and (ii) good cause exists to make this rule effective in less than 30 days.

Background

On September 19, 2000, the FAA published the “Commercial Space Transportation Reusable Launch Vehicle and Reentry Licensing Regulations; Final Rule” (65 FR 56618). The final rule amended commercial space transportation regulations governing the launch and reentry of reusable launch vehicles (RLVs) to establish operational requirements for launches of RLVs and to implement the FAA's reentry licensing authority by prescribing requirements for obtaining a license to launch and reenter an RLV, to reenter a reentry vehicle, and to operate a reentry site. Licensing rules are necessary to respond to advancements in the development of commercial RLV and reentry capability. The action was necessary to fulfill the FAA's safety mandate by limiting risk to the public from RLV and reentry operations.

The final rule contains a more complete discussion of the rule and the events leading up to it.

Technical Amendment

The technical amendment makes the following correction:

(1) In § 431.79(a)(3), the duplicate text “federal” is removed and the phrase “for at” is changed to “from”.

List of Subjects in 14 CFR Part 431

Aviation safety, Environmental protection, Investigations, Reporting and recordkeeping requirements, Space transportation and exploration.

The Amendment

In consideration of the foregoing, the Federal Aviation Administration amends chapter III of title 14, Code of Federal Regulations as follows:

PART 431—LAUNCH AND REENTRY OF A REUSABLE LAUNCH VEHICLE (RLV) 1. The authority citation of part 431 continues to read as follows: Authority:

51 U.S.C. 50901-50923.

§ 431.79 [Amended]
2. Amend § 431.79(a)(3) by removing the duplicate text “federal” and by removing the phrase “for at” and adding in its place “from”. Issued in Washington, DC, on August 23, 2016. Dale Bouffiou, Acting Director, Office of Rulemaking.
[FR Doc. 2016-20815 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
MILLENNIUM CHALLENGE CORPORATION 22 CFR Part 1306 [MCC FR 16-03] Collection of Debts AGENCY:

Millennium Challenge Corporation.

ACTION:

Final rule.

SUMMARY:

The purpose of these regulations is to implement statutes which authorize the collection of debts owed to the Federal government, by persons, organizations, or entities including by salary offset, administrative offset, or tax refund offset. Generally, however, a debt may not be collected by such means if it has been outstanding for more than ten years after the agency's right to collect the debt first accrued. These regulations are consistent with the Office of Personnel Management regulations on salary offset, and with regulations on administrative offset. Persons with access to the internet may also view this document by going to the regulations.gov Web site at: http://www.regulations.gov/index.cfm.

DATES:

This rule is effective September 24, 2016.

ADDRESSES:

You may submit comments by any of the following methods:

Email: [email protected]

Mail paper submissions to the Office of the General Counsel, Millennium Challenge Corporation, 1099 Fourteenth Street NW., Washington, DC 20005.

FOR FURTHER INFORMATION CONTACT:

Laura M. Leussing, Office of the General Counsel, Millennium Challenge Corporation, telephone 202-521-3680.

SUPPLEMENTARY INFORMATION:

The Debt Collection Improvement Act (DCIA), 31 U.S.C. 3720B to 3720E, Public Law 104-134, enacted April 26, 1996) and the Federal Claims Collection Standards, 31 U.S.C. 3701 et seq., require the government to collect money it is owed. For purposes of the DCIA, debts include overpayments of pay and allowances made to federal employees. 5 U.S.C. 5514. This regulation provides procedures for the collection of debts owed to MCC. MCC adopts the Government-wide debt collection standards promulgated by the Departments of the Treasury and Justice, known as the Federal Claims Collection Standards (FCCS), 31 CFR parts 900-904 (as revised on November 22, 2000) and supplements the FCCS by prescribing procedures consistent with the FCCS, as necessary and appropriate for MCC operations. Nothing in this regulation precludes the use of otherwise authorized collection remedies not contained in this regulation.

Regulatory Analysis Administrative Procedures Act

No notice of proposed rulemaking is required under the Administrative Procedure Act (APA) because these rules relate solely to agency procedure and practice (5 U.S.C. 553(b)(3)(A)).

Paperwork Reduction Act

This rule does not impose any new reporting or recordkeeping requirements subject to the Paperwork Reduction Act, 44 U.S.C. chapter 35.

Regulatory Flexibility Act

MCC, in accordance with the Regulatory Flexibility Act (5 U.S.C. 605(b)), has reviewed this regulation and, by approving it, certifies that this final rule will not have a significant economic impact on a substantial number of small entities.

Small Business Regulatory Enforcement Act of 1996

This rule is not a major rule as defined by section 251 of the Small Business Regulatory Enforcement Act of 1996 (5 U.S.C. 804). This rule will not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.

Executive Order 12866

These regulations are not classified as “significant rules” under Executive Order 12866 because they will not result in (1) an annual effect on the economy of $100 million or more; (2) a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or (3) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic or foreign markets. Accordingly, no regulatory impact assessment is required.

Executive Order 12988

MCC has reviewed this regulation in light of sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to eliminate ambiguity, minimize litigation, establish clear legal standards, and reduce burden.

List of Subjects in 22 CFR Part 1306

Administrative practice and procedure, Claims, Debts, Garnishment of wages, Government employee, Hearing and appeal procedures, Pay administration, Salaries, Wages.

In consideration of the foregoing, the Millennium Challenge Corporation amends Chapter XIII of 22 CFR by adding part 1306, to read as follows:

PART 1306—DEBT COLLECTION Subpart A—General Provisions 1306.1 Purpose. 1306.2 Scope. 1306.3 Definitions. 1306.4 Other procedures or actions. 1306.5 Interest, penalties, and administrative cost. 1306.6 Collection in installments. 1306.7 Designation. 1306.8 Application. Subpart B—Administrative Wage Garnishment 1306.9 Administrative wage garnishment. Subpart C—Salary Offset 1306.10 Scope. 1306.11 Coordinating offset with another Federal agency. 1306.12 Notice requirements before offset. 1306.13 Employee response. 1306.14 Request for a hearing for certain debts. 1306.15 Hearings. 1306.16 Procedures for salary offset. 1306.17 Non-waiver of rights by payment. 1306.18 Waiver of indebtedness. 1306.19 Compromise. 1306.20 Suspension. 1306.21 Termination. 1306.22 Discharge. 1306.23 Bankruptcy. 1306.24 Refunds. Authority:

31 U.S.C. 3701-3719; 5 U.S.C. 5514; 31 CFR part 285; 31 CFR parts 900-904; 5 CFR part 550 subpart K.

Subpart A—General Provisions
§ 1306.1 Purpose.

The regulations in this part prescribe the procedures to be used by the Millennium Challenge Corporation (MCC) in the collection and/or disposal of non-tax debts owed to MCC and to the United States.

§ 1306.2 Scope.

(a) Applicability of Federal Claims Collection Standards (FCCS). MCC hereby adopts the provisions of the Federal Claims Collections Standards (31 CFR parts 900-904) and, except as set forth in this part or otherwise provided by law, MCC will conduct administrative actions to collect claims (including offset, compromise, suspension, termination, disclosure and referral) in accordance with the FCCS.

(b) This part is not applicable to any debt or claim for which collection is explicitly provided for or prohibited under other statutory authorities. This includes, but is not limited to:

(1) MCC claims against another Federal agency, any foreign country or any political subdivision thereof, or any public international organization.

(2) Debts arising out of acquisitions subject to the Federal Acquisition Regulation (FAR) which shall be determined, collected, compromised, terminated, or settled in accordance with the regulations published at 48 CFR part 32.

(3) Debts arising from the audit of transportation accounts pursuant to 31 U.S.C. 3726 which shall be determined, collected, compromised, terminated, or settled in accordance with the regulations published at 41 CFR parts 102-118.

(4) Debts based in whole or in part on conduct in violation of the antitrust laws, or in regard to which there is an indication of fraud, presentation of a false claim, or misrepresentation on the part of the debtor or any other party having an interest in the claim, which shall be referred to the Department of Justice for compromise, suspension, or termination of collection action.

(5) Tax debts.

§ 1306.3 Definitions.

For purposes of this part:

(a) Administrative offset means withholding funds payable by the United States to, or held by the United States for, a person to satisfy a debt owed by the person to the United States.

(b) Administrative wage garnishment means the process by which a Federal agency orders a non-Federal employer to withhold amounts from a debtor's wages to satisfy a debt owed to the United States.

(c) Compromise means that the creditor agency accepts less than the full amount of an outstanding debt in full satisfaction of the entire amount of the debt.

(d) Creditor agency means the Federal agency to which a debt is owed including a debt collection center when acting in behalf of a creditor agency in matters pertaining to the collection of a debt (as provided in 5 CFR 550.1110).

(e) Debt or claim means an amount of money which has been determined to be owed to the United States from any person. A debtor's liability arising from a particular contract or transaction shall be considered a single claim for purposes of the monetary ceilings of the FCCS.

(f) Debtor means a person who owes the Federal government money.

(g) Delinquent debt means a debt that has not been paid by the date specified in MCC's written notification or applicable contractual agreement, unless other satisfactory arrangements have been made by that date, or that has not been paid in accordance with a payment agreement with MCC.

(h) Discharge means the release of a debtor from personal liability for a debt. Further collection action is prohibited.

(i) Disposable pay means the amount that remains from an employee's current basic pay, special pay, incentive pay, retired pay, retainer pay, or in the case of an employee not entitled to basic pay, other authorized pay remaining after required deductions for Federal, State and local income taxes; Social Security taxes, including Medicare taxes; Federal retirement programs; normal premiums for life and health insurance benefits and such other deductions that are required by law to be withheld, excluding garnishments.

(j) FCCS means the Federal Claims Collection Standards published jointly by the Departments of the Treasury and Justice and codified at 31 CFR parts 900-904.

(k) Person means an individual, corporation, partnership, association, organization, State or local government, or any other type of entity other than a Federal agency, Foreign Government, or public international organization.

(l) Salary offset means an administrative offset to collect a debt under 5 U.S.C. 5514 by deduction(s) at one or more officially established pay intervals from the current pay account of a Federal employee without his or her consent to satisfy a debt owed by that employee to the United States.

(m) Suspension means the temporary cessation of active debt collection pending the occurrence of an anticipated event.

(n) Termination means the cessation of all active debt collection action for the foreseeable future.

(o) Waiver means the cancellation, remission, forgiveness, or non-recovery of a debt allegedly owed by an employee to an agency as permitted or required by 5 U.S.C. 5522, 5 U.S.C. 5584, 5 U.S.C. 5922, 5 U.S.C. 8346(b), or any other law.

§ 1306.4 Other procedures or actions.

(a) Nothing contained in this part is intended to require MCC to duplicate administrative proceedings required by contract or other laws or regulations.

(b) Nothing in this part is intended to preclude utilization of informal administrative actions or remedies which may be available.

(c) Nothing contained in this part is intended to deter MCC from demanding the return of specific property or from demanding the return of the property or the payment of its value.

(d) The failure of MCC to comply with any provision in this part shall not serve as defense to the debt.

§ 1306.5 Interest, penalties, and administrative costs.

Except as otherwise provided by statute, contract or excluded in accordance with the FCCS, MCC will assess:

(a) Interest on delinquent debts in accordance with 31 CFR 901.9.

(b) Penalties at the rate of 6 percent a year or such other rate as authorized by law on any portion of a debt that is delinquent for more than 90 days.

(c) Administrative costs to cover the costs of processing and calculating delinquent debts.

(d) Late payment charges under paragraphs (a) and (b) of this section shall be computed from the date of delinquency.

(e) When a debt is paid in partial or installment payments, amounts received shall be applied first to outstanding penalty and administrative cost charges, second to accrued interest, and then to outstanding principal.

(f) MCC shall consider waiver of interest, penalties and/or administrative costs in accordance with the FCCS, 31 CFR 901.9(g).

§ 1306.6 Collection in installments.

(a) Whenever feasible, and except as required otherwise by law, debts owed to the United States, together with interest, penalties, and administrative costs as required by this part, should be collected in one lump sum. This is true whether the debt is being collected under administrative offset, including salary offset, or by another method, including voluntary payment. However, if the debtor is financially unable to pay the indebtedness in one lump sum or the amount of debt exceeds 15 percent of disposable pay for an officially established pay interval collection must be made in regular installments. If possible, the installment payments should be sufficient in size and frequency to liquidate the Government's claim within three years, and in the case of a current MCC employee, installment repayment plans must be made over a period not greater than the anticipated period of employment, except as provided in paragraph (b) in this section. However, the amount deducted for any period under this section and § 1306.16 may not exceed 15 percent of the disposable pay from which the deduction is made, unless the employee has agreed in writing to the deduction of a greater amount or a higher deduction has been ordered by a court.

(b) If the employee retires or resigns or if his or her employment ends before collection of the debt is completed, MCC may collect the debt from subsequent payments of any nature (e.g., final salary payment, lump-sum leave, etc.) due the employee from the paying agency as of the date of separation to the extent necessary to liquidate the debt. Following the employee's separation, MCC may collect any later payments of any kind that are due to the former employee from the United States to the extent necessary to liquidate the debt.

§ 1306.7 Designation.

The Chief Financial Officer is delegated authority and designated to perform all the duties for which head of the agency is responsible under the forgoing statutes and joint regulations. The authority delegated hereunder may be further delegated by the Chief Financial Officer subject to applicable laws, regulations and MCC policies.

§ 1306.8 Application.

(a) MCC shall aggressively collect claims and debts in accordance with this part and applicable law.

(b) In accordance with the FCCS:

(1) MCC will transfer to the Department of the Treasury, Financial Management Service (FMS) any past due, legally enforceable non-tax debt that has been delinquent for 180 days or more so that FMS may take appropriate action to collect the debt or take other appropriate action in accordance with applicable law and regulation; and

(2) MCC may transfer any past due, legally enforceable debt that has been delinquent for fewer than 180 days to FMS for collection in accordance with applicable law and regulation. (See 31 CFR part 285).

Subpart B—Administrative Wage Garnishment
§ 1306.9 Administrative wage garnishment.

MCC hereby adopts the administrative wage garnishment rules issued by the Department of the Treasury at 31 CFR 285.11.

Subpart C—Salary Offset
§ 1306.10 Scope.

(a) This subpart sets forth MCC's procedures for the collection of a Federal employee's current pay by salary offset to satisfy certain debts owed to the United States.

(b) This subpart applies to:

(1) Current employees of MCC and other agencies who owe debts to MCC;

(2) Current employees of MCC who owe debts to other agencies.

(c) This subpart does not apply to:

(1) Debts or claims arising under the Internal Revenue Code of 1954 (26 U.S.C. 1 et seq.); the Social Security Act (42 U.S.C. 301 et seq.); the tariff laws of the United States.

(2) Any case where collection of a debt by salary offset is explicitly provided for or prohibited by another statute (e.g., travel advances in 5 U.S.C. 5705 and employee training expenses in 5 U.S.C. 4108); or

(3) Any other debts excluded by the Federal Claims Collections Standards (31 CFR parts 900-904) or 31 CFR part 285.

(d) This part does not preclude an employee from requesting waiver of the debt, if waiver is available under subpart C of this part or by other regulation or statute.

(e) Nothing in this part precludes the compromise, suspension or termination of collection actions where appropriate under § 1306.18 or other regulations or statutes.

§ 1306.11 Coordinating offset with another Federal agency.

(a) When MCC is owed a debt by an employee of another agency, MCC shall provide the agency with a written certification that the debtor owes MCC a debt (including the amount and basis of the debt and the due date of payment) and that MCC has complied with this part.

(b) When another agency is owed the debt, MCC may use salary offset against one of its employees who is indebted to another agency, if requested to do so by that agency. Such request must be accompanied by a certification that the person owes the debt (including the amount and basis of the debt and the due date of payment) and that the agency has complied with its regulations as required by 5 U.S.C. 5514 and 5 CFR part 550, subpart K.

§ 1306.12 Notice requirements before offset.

(a) Deductions under the authority of 5 U.S.C. 5514 shall not be made unless the creditor agency first provides the employee with written notice that he/she owes a debt to the Federal Government at least 30 calendar days before salary offset is to be initiated. When MCC is the creditor agency this notice of intent to offset an employee's salary shall be hand-delivered or sent by certified mail to the most current address that is available. The written notice will state:

(1) That MCC has reviewed the records relating to the claim and has determined that a debt is owed, its origin and nature, and the amount of the debt;

(2) The intention of MCC to collect the debt by means of deduction from the employee's current disposable pay account until the debt, all accumulated interest, penalties and administrative costs are paid in full;

(3) The amount, frequency, approximate beginning date, and duration of the intended deductions;

(4) An explanation of MCC's policy concerning interest, penalties and administrative costs, including a statement that such assessments must be made unless excused in accordance with the FCCS;

(5) The employee's right to inspect and copy all records of MCC pertaining to the debt claimed or to receive copies of such records if personal inspection is impractical;

(6) If not previously provided, the opportunity (under terms agreeable to MCC) to establish a schedule for the voluntary repayment of the debt or to enter into a written agreement to establish a schedule for repayment of the debt in lieu of offset. The agreement must be in writing, signed by both the employee and MCC, and documented in MCC's files;

(7) The employee's right to a hearing conducted by a hearing official (an administrative law judge, or alternatively, an individual not under the supervision or control of MCC, but in each case arranged by MCC) with respect to the existence and amount of the debt claimed, or the repayment schedule, so long as a petition is filed by the employee in accordance with this part;

(8) The name, address and telephone number of an official to whom questions and correspondence regarding this notice may be directed;

(9) The method and time period for requesting a hearing;

(10) That the timely filing of a petition for a hearing as prescribed by this part will stay the commencement of collection proceedings;

(11) The name and address of the office to which the petition for hearing should be sent;

(12) That MCC will initiate certification procedures to implement a salary offset, as appropriate, (which may not exceed 15 percent of the employee's disposable pay) not less than 30 calendar days from the date of delivery of the notice of debt, unless the employee files a timely petition for a hearing;

(13) That a final decision on the hearing (if one is requested) will be issued at the earliest practical date, but not later than 60 calendar days after the filing of the petition requesting the hearing, unless the employee requests and the hearing official grants a delay in the proceedings;

(14) That any knowingly false or frivolous statements, representation, or evidence may subject the employee to disciplinary procedures (5 U.S.C. Chapter 75, 5 CFR part 752 or other applicable statutes or regulations); penalties (31 U.S.C. 3729-3731 or other applicable statutes or regulations); or criminal penalties (18 U.S.C. 286, 287, 1001, and 1002 or other applicable statutes or regulations);

(15) Any other rights and remedies available to the employee under statutes or regulations governing the program for which the collection is being made;

(16) That unless there are applicable contractual or statutory provisions to the contrary, amounts paid on or deducted for the debt which are later waived or found not owed to the United States will be promptly refunded to the employee; and

(17) That proceedings with respect to such debt are governed by 5 U.S.C. 5514.

(b) MCC is not required to provide prior notice to an employee when the following adjustments are made by MCC to an MCC employee's pay:

(1) Any adjustment to pay arising out of an employee's election of coverage or a change in coverage under a Federal benefits program requiring periodic deductions from pay if the amount to be recovered was accumulated over four pay periods or less;

(2) A routine adjustment of pay that is made to correct an overpayment of pay attributable to clerical or administrative errors or delays in processing pay documents, if the overpayment occurred within the four pay periods preceding the adjustment, and, at the time of such adjustment, or as soon thereafter as practical, the individual is provided written notice of the nature and the amount of the adjustment and a point of contact for contesting the adjustment; or

(3) Any adjustment to collect a debt of $50 or less, if, at the time of such adjustment, or as soon thereafter as practical, the individual is provided written notice of the nature of the amount of the adjustment and a point of contact for contesting the adjustment.

§ 1306.13 Employee response.

(a) Voluntary repayment agreement. An employee may submit a request to enter into a written repayment agreement of the debt in lieu of offset. The request must be made within 7 days of receipt of notice under § 1306.12 to the official identified in § 1306.12(a)(8). The agreement must be in writing signed by both the employee and the appropriate official within MCC. Acceptance of such an agreement is discretionary with the Agency. An employee who enters into such an agreement may, nevertheless, seek a waiver under § 1306.18.

(b) Reconsideration. (1) An employee may seek a reconsideration of MCC's determination regarding the existence and/or amount of the debt. The request must be made within 7 days of receipt of notice under § 1306.12 to the official identified in 1306.12(a)(8). Within 20 days of receipt of this notice, the employee must submit a detailed statement of reasons for reconsideration that must be accompanied by supporting documentation.

(2) An employee may seek a reconsideration of MCC's proposed offset schedule. The request must be made within 7 days of receipt of notice under § 1306.12 to the official identified in § 1306.12(a)(8). Within 20 days of receipt of this notice, the employee must submit an alternative repayment schedule accompanied by a detailed statement, supported by documentation, evidencing financial hardship resulting from MCC's proposed schedule. Acceptance of the request is at MCC's discretion. MCC will notify the employee in writing of its decision concerning the request to reduce the rate of an involuntary deduction.

§ 1306.14 Request for a hearing for certain debts.

(a) Except as provided in paragraphs (d) and (e) of this section, an employee must file a request that is received by the official identified in the notice provided pursuant to § 1306.12(a)(11) not later than 15 calendar days from the date of MCC's notice if an employee wants a hearing concerning:

(1) The existence or amount of the debt; or

(2) MCC's proposed offset schedule.

(b) The request must be signed by the employee and should identify and explain with reasonable specificity and brevity the facts, evidence and witnesses, if any, which the employee believes support his or her position. If the employee objects to the percentage of disposable pay to be deducted from each check, the request should state the objection and the reasons for it.

(c) The employee must also specify whether an oral or paper hearing is requested. If an oral hearing is desired, the request should explain why the matter cannot be resolved by review of the documentary evidence alone.

(d) If the employee files a request for a hearing later than the required 15 calendar days as described in paragraph (a) of this section, MCC may accept the request if the employee can show that the delay was because of circumstances beyond his or her control or because of failure to receive notice of the filing deadline (unless the employee otherwise has actual notice of the filing deadline).

(e) If the employee files a timely request for reconsideration pursuant to § 1306.13(b), the employee must file a request for a hearing by the official identified in the notice provided pursuant to § 1306.12(a)(11) not later than 15 calendar days from the date of MCC's written decision concerning the reconsideration request.

(f) An employee waives the right to a hearing and will have his or her pay offset if the employee fails to file a petition for a hearing in accordance with this section.

§ 1306.15 Hearings.

(a) If an employee timely files a request for a hearing under § 1306.14, pursuant to 5 U.S.C. 5514(a)(2), the hearing official shall select the time, date, and location of the hearing.

(b) Hearings shall be conducted by a hearing official not under the supervision or control of MCC or an administrative law judge.

(c) Procedure. (1) After the employee requests a hearing, the hearing official shall notify the employee of the form of the hearing to be provided. If the hearing will be oral, notice shall set forth the date, time and location of the hearing. If the hearing will be paper, the employee shall be notified that he or she should submit arguments in writing to the hearing official by a specified date after which the record shall be closed. This date shall give the employee reasonable time to submit documentation.

(2) Oral hearing. An employee who requests an oral hearing shall be provided an oral hearing if the hearing official determines that the matter cannot be resolved by review of documentary evidence alone (e.g., when an issue of credibility or veracity is involved). The hearing is not an adversarial adjudication, and need not take the form of an evidentiary hearing.

(3) Paper hearing. If the hearing official determines that an oral hearing is not necessary, he or she will make a decision based upon a review of the available written record.

(4) Record. The hearing official must maintain a summary record of any hearing provided by this subpart. Witnesses who provide testimony will do so under oath or affirmation.

(5) Content of decision. The written decision shall include:

(i) A statement of the facts presented to support the origin, nature, and amount of the debt;

(ii) The hearing official's findings, analysis, and conclusions; and

(iii) The terms of any repayment schedules, or the date salary offset will commence, if applicable.

(6) Failure to appear. In the absence of good cause shown (e.g., excused illness), an employee who fails to appear at an oral hearing shall be deemed, for the purpose of this part, to admit the existence and amount of the debt as described in the notice of intent. The hearing official shall schedule a new hearing date upon the request of MCC's representative when good cause is shown.

(d) A hearing official's decision is considered to be an official certification regarding the existence and amount of the debt for purposes of executing salary offset under 5 U.S.C. 5514 only.

§ 1306.16 Procedures for salary offset.

Unless otherwise provided by statute, regulation, or contract, the following procedures apply to salary offset:

(a) Method. Salary offset will be made by deduction at one or more officially established pay intervals from the current pay account of the employee without his or her consent.

(b) Source. The source of salary offset is current disposable pay.

(c) Types of collection. (1) Lump sum payment. Ordinarily debts will be collected by salary offset in one lump sum if possible. However, if the amount of the debt exceeds 15 percent of disposable pay for an officially established pay interval, the collection by salary offset must be made in installment deductions, except as provided by other laws or regulations or unless the employee has agreed in writing to a greater amount.

(2) Installment deductions. (i) The size of installment deductions must bear a reasonable relation to the size of the debt and the employee's ability to pay. If possible, the size of the deduction will be that necessary to liquidate the debt in no more than 1 year. However, the amount deducted for any period must not exceed 15 percent of the disposable pay from which the deduction is made, except as provided by other laws or regulations or unless the employee has agreed in writing to a greater amount.

(ii) Installment payments of less than $50 per pay period will be accepted only in unusual circumstances such as when that amount exceeds 15% of disposable pay.

(iii) Installment deductions should be sufficient in size and frequency to liquidate the Government's claim within three years and must be made over a period not greater than the anticipated period of employment.

§ 1306.17 Non-waiver of rights by payments.

So long as there are no statutory or contractual provisions to the contrary, no employee payment (of all or a portion of a debt) collected under this part will be interpreted as a waiver of any rights that the employee may have under 5 U.S.C. 5514.

§ 1306.18 Waiver of indebtedness.

(a) An employee may request a waiver of indebtedness. When an employee makes a request under a statutory right, further collection may be stayed pending an administrative determination on the request. During the period of any suspension, interest, penalties and administrative charges may be held in abeyance. MCC will not duplicate, for purposes of salary offset, any of the notices/procedures already provided the debtor prior to a request for waiver.

(b) Waiver of indebtedness is an equitable remedy and as such must be based on an assessment of the facts involved in the individual case under consideration. The burden is on the employee to demonstrate that the applicable waiver standard has been met in accordance with MCC's Policy on Waivers of Indebtedness.

(c) A debtor requesting a waiver shall do so in writing to the official identified in § 1306.12(a)(8) and within the timeframe stated within the initial notice sent under § 1306.12. The debtor's written response shall state the basis for the dispute and include any relevant documentation in support.

(d) While a waiver request is pending, MCC may suspend collection, including the accrual of interest and penalties, on the debt if MCC determines that suspension is in the agency's best interest or would serve equity and good conscience.

§ 1306.19 Compromise.

MCC may attempt to effect a compromise with respect to the debt in accordance with the process and standards set forth in the FCCS, 31 CFR part 902.

§ 1306.20 Suspension.

Any suspension of collection action shall be made in accordance with the standards set forth in the FCCS, 31 CFR 903.1-903.2.

§ 1306.21 Termination.

Any termination of a collection action shall be made in accordance with the standards set forth in the FCCS, 31 CFR 903.1 and 903.3-903.4.

§ 1306.22 Discharge.

Once a debt has been closed out for accounting purposes and collection has been terminated, the debt is discharged. MCC must report discharged debt as income to the debtor to the Internal Revenue Service per 26 U.S.C. 6050P and 26 CFR 1.6050P-1.

§ 1306.23 Bankruptcy.

A debtor should notify MCC at the contact office provided in the original notice of the debt, if the debtor has filed for bankruptcy. MCC will require documentation from the applicable court indicating the date of filing and type of bankruptcy. Pursuant to the laws of bankruptcy, MCC will suspend debt collection upon such filing unless the automatic stay is no longer in effect or has been lifted. In general, collection of a debt discharged in bankruptcy shall be terminated unless otherwise provided for by bankruptcy law.

§ 1306.24 Refunds.

(a) MCC will refund promptly to the appropriate individual amounts offset under this part when:

(1) A debt is waived or otherwise found not owing the United States (unless expressly prohibited by statute or regulation); or

(2) MCC is directed by an administrative or judicial order to make a refund.

(b) Refunds do not bear interest unless required or permitted by law or contract.

Dated: August 25, 2016. Laura M. Leussing, Assistant General Counsel, Millennium Challenge Corporation.
[FR Doc. 2016-20800 Filed 8-29-16; 8:45 am] BILLING CODE 9211-03-P
DEPARTMENT OF THE TREASURY Alcohol and Tobacco Tax and Trade Bureau 27 CFR Parts 19, 20, 21, 27, and 28 [Docket No. TTB-2013-0005; T.D. TTB-140; Re: Notice No. 136] RIN 1513-AB59 Reclassification of Specially Denatured Spirits and Completely Denatured Alcohol Formulas and Related Amendments AGENCY:

Alcohol and Tobacco Tax and Trade Bureau, Treasury.

ACTION:

Final rule; Treasury decision.

SUMMARY:

The Alcohol and Tobacco Tax and Trade Bureau is amending its regulations concerning denatured alcohol and products made with industrial alcohol. The amendments eliminate outdated specially denatured spirits formulas from the regulations, reclassify some specially denatured spirits formulas as completely denatured alcohol formulas, and issue some new general-use formulas for manufacturing products with specially denatured spirits. The amendments remove unnecessary regulatory burdens on the industrial alcohol industry, as well as on TTB, and align the regulations with current industry practice. The amendments also make other improvements and clarifications, as well as a number of minor technical changes and corrections to the regulations.

DATES:

This final rule is effective October 31, 2016.

FOR FURTHER INFORMATION CONTACT:

Karen Welch, Alcohol and Tobacco Tax and Trade Bureau, Regulations and Rulings Division; telephone 202-453-1039, ext. 046; email [email protected]

SUPPLEMENTARY INFORMATION:

Authority and Background Internal Revenue Code

Chapter 51 of the Internal Revenue Code of 1986 (IRC), 26 U.S.C. chapter 51, contains excise tax and related provisions concerning distilled spirits used for both beverage and nonbeverage purposes. The IRC imposes an excise tax rate of $13.50 per proof gallon on distilled spirits (26 U.S.C. 5001). Under section 5006(a) of the IRC (26 U.S.C. 5006(a)) the excise tax on distilled spirits is generally determined at the time the distilled spirits are withdrawn from the bonded premises of a distilled spirits plant.

However, section 5214(a) of the IRC authorizes, subject to regulations prescribed by the Secretary of the Treasury, the following two types of spirits to be withdrawn free of tax:

• Spirits that have been “denatured” by the addition of materials that make the spirits unfit for beverage consumption; and

• Undenatured spirits for certain governmental, educational, medical, or research purposes.

Section 5214(a)(1) of the IRC permits the withdrawal of denatured spirits free of tax for:

• Exportation;

• Use in the manufacture of a definite chemical substance, where such distilled spirits are changed into some other chemical substance and do not appear in the finished product; or

• Any other use in the arts or industry, or for fuel, light, or power, except that, under 26 U.S.C. 5273(b), denatured spirits may not be used in the manufacture of medicines or flavors for internal human use where any of the spirits remain in the finished product, and, under section 5273(d), denatured spirits may not be withdrawn or sold for beverage purposes.

The IRC authorizes the Secretary of the Treasury to prescribe regulations regarding the production, warehousing, denaturing, distribution, sale, export, and use of industrial alcohol in order to protect the revenue (26 U.S.C. 5201), and to regulate materials that are suitable to denature distilled spirits (26 U.S.C. 5241 and 5242). Section 5242 states that denaturing materials shall be such as to render the spirits with which they are admixed unfit for beverage or internal medicinal use and that the character and quantity of denaturing materials used shall be as prescribed by the Secretary by regulations. Furthermore, section 5273(a) of the IRC requires that any person using specially denatured spirits (which is defined in the following section of this document) to manufacture products:

* * * shall file such formulas and statements of process, submit such samples, and comply with such other requirements, as the Secretary shall by regulations prescribe, and no person shall use specially denatured distilled spirits in the manufacture or production of any article until approval of the article, formula, and process has been obtained from the Secretary.1

1 Other sections of the IRC relating to denatured spirits set forth requirements pertaining to the taxation and manufacture of distilled spirits, the withdrawal of distilled spirits free of tax or without payment of tax, the importation and exportation of distilled spirits, the issuance of permits for industrial alcohol users and dealers, the sale and use of industrial alcohol, and the recovery of potable alcohol from industrial alcohol (see 26 U.S.C. 5002 through 5008, 5061, 5062, 5101, 5111, 5112, 5131, 5132, 5181, 5204, 5214, 5232, 5235, 5271, 5273, and 5313).

Regulation of Denatured Spirits

The Alcohol and Tobacco Tax and Trade Bureau (TTB) administers chapter 51 of the IRC pursuant to section 1111(d) of the Homeland Security Act of 2002, codified at 6 U.S.C. 531(d). The Secretary has delegated various authorities through Treasury Department Order 120-01 (dated December 10, 2013, superseding Treasury Order 120-01 (Revised), “Alcohol and Tobacco Tax and Trade Bureau,” dated January 24, 2003), to the TTB Administrator to perform the functions and duties in the administration and enforcement of this law.

Regulations pertaining specifically to denatured spirits are found in 27 CFR part 20 (Distribution and use of denatured alcohol and rum) and part 21 (Formulas for denatured alcohol and rum). Certain provisions in TTB's regulations in 27 CFR part 19 (Distilled spirits plants), part 27 (Importation of distilled spirits, wines, and beer), and part 28 (Exportation of alcohol) also concern denatured spirits. Denatured spirits are spirits to which denaturants—which are materials that make alcoholic mixtures unfit for beverage or internal human medicinal use—have been added in accordance with 27 CFR part 21. TTB approves denaturants if the denaturants: (1) Make the spirits unfit for beverage or internal human medicinal use (26 U.S.C. 5242 and 27 CFR 21.11), (2) are adequate to protect the Federal excise tax revenue (27 CFR 21.91), and (3) are suitable for the intended use of the denatured spirits (26 U.S.C. 5242).2

2 In most cases, spirits used for industrial purposes are “alcohol,” which in this context means a type of spirits distilled at more than 160 degrees of proof and substantially neutral in character, lacking the taste, aroma, and other characteristics generally attributed to whisky, brandy, rum, or gin. (27 CFR 19.487(a)(1).)

There are two types of denatured spirits: Completely denatured alcohol (C.D.A.) and specially denatured spirits (referred to as “S.D.S.” for purposes of this preamble). C.D.A. jeopardizes the revenue less than S.D.S. does—first, C.D.A. is more offensive to the taste than S.D.S. and thus C.D.A. is less likely to be used for beverage purposes, and second, it is more difficult to separate potable alcohol from C.D.A. than it is from S.D.S. For these reasons, the withdrawal and use of C.D.A. are subject to less stringent regulatory oversight than are the withdrawal and use of S.D.S.

Title 27 CFR 20.41 provides that permits are required to withdraw, deal in, or use S.D.S. The regulations also require that dealers and users of S.D.S. maintain specified records and retain invoices (see 27 CFR 20.262 through 20.268). Under § 20.264(b), users of S.D.S. are required to submit an annual report to TTB, and, under § 20.262(d), a dealer, as defined in 27 CFR 20.11, when requested by TTB, must submit a required accounting of each formulation of new and recovered S.D.S. In contrast, under 27 CFR 20.141, no permits are required to use or distribute C.D.A. (with the exception of recovery for reuse). A person that receives, packages, stores, disposes of, or uses C.D.A. is required to maintain records only when specifically requested by TTB (see 27 CFR 20.261). The regulations do not provide any reporting requirements for persons that use or deal in C.D.A.

The regulations prescribe formulas for C.D.A. and for S.D.S. C.D.A. generally may be sold and used for any purpose (§ 20.141), with the exception that C.D.A. denatured in accordance with Formula No. 20 is restricted to fuel use (27 CFR 21.24). In contrast, S.D.S., which is generally used as a raw material or ingredient in the manufacture of other products (termed “articles”), may not be used for any purpose not specifically authorized in the regulations. The authorized purposes are categorized within “use codes,” which are published in the regulations in 27 CFR part 21.

Manufacture of Articles With Denatured Spirits

Both C.D.A. and S.D.S. may be used to manufacture articles, which are defined in section 5002(a)(14) of the IRC (26 U.S.C. 5002(a)(14)) as “any substance in the manufacture of which denatured distilled spirits are used.” The manufacture of articles with C.D.A. is generally unregulated. By contrast, the manufacture of articles with S.D.S. is strictly regulated under 27 CFR part 20, in accordance with sections 5271 through 5275 of the IRC (26 U.S.C. 5271-5275). A significant aspect of this regulation is the requirement for prior TTB approval of all articles made with S.D.S. Such approval is mandated by law in section 5273(a) of the IRC (26 U.S.C. 5273(a)), which states, “* * * no person shall use specially denatured distilled spirits in the manufacture or production of any article until approval of the article, formula, and process has been obtained from the Secretary.”

TTB approval of articles takes two forms. First, TTB approves specific, proprietary formulas and processes for articles, submitted by manufacturers on TTB Form 5150.19, Formula and/or Process for Article Made with Specially Denatured Spirits. (TTB encourages industry members to submit this form electronically using Formulas Online, which is available at www.ttb.gov.) Second, “general-use formulas,” which TTB generally approves by publishing them in the regulations in 27 CFR part 20, are approved formulas for articles. General-use formulas may be used by any manufacturer that has a TTB permit to use S.D.S. in the manufacture of articles. Each general-use formula authorizes the production of only a specific type of article. Under § 20.111, manufacturers of articles produced pursuant to general-use formulas are not required to obtain specific formula approval from TTB on TTB Form 5150.19. Thus, the regulatory burden is lighter on manufacturers producing articles pursuant to general-use formulas than on manufacturers producing articles pursuant to other formulas that prescribe S.D.S. (In fiscal year 2015, TTB received 1,163 formula applications on TTB Form 5150.19.)

Terminology

TTB is providing the following definitions to assist in comprehension of this final rule:

• An article is any substance or preparation manufactured using denatured spirits.

Completely Denatured Alcohol (C.D.A.) is alcohol that has been denatured under a formula specified in subpart C of 27 CFR part 21. Only a registered distilled spirits plant may produce C.D.A. TTB and industry generally refer to formulations of C.D.A. by the formula number. For example, a formulation produced in accordance with C.D.A. Formula No. 20 is simply referred to as “C.D.A. 20.” To reflect the common parlance, this same shorthand is used throughout this document.

• A formula is an instruction for manufacturing a product, and is analogous to a recipe that a cook follows. This document refers to two broad types of formulas: denatured alcohol formulas and article formulas. Denatured alcohol formulas specify the instructions for producing either S.D.S (as specified in 27 CFR part 21 subpart D) or C.D.A. (as specified in 27 CFR part 21 subpart C). Article formulas include both formulas approved individually by TTB on TTB Form 5150.19 and general-use formulas (as specified in 27 CFR 20.112 through 20.119).

• A formulation is a physical product manufactured in accordance with a formula, and is analogous to a cooked meal that has been prepared using a recipe. The word “formulation” can refer to S.D.S., C.D.A., or an article.

• A general-use formula is a formula for making a certain type of article that is prescribed by 27 CFR 20.112 through 20.119, approved by TTB as an alternate method, or published as a TTB ruling. Specific formula approval by TTB on Form 5150.19 is not required for an article made pursuant to a general-use formula.

Specially Denatured Alcohol (S.D.A) is alcohol that has been denatured following a formula specified in subpart D of 27 CFR part 21. A formulation of S.D.A. may be used only for the uses specified for the corresponding formula in 27 CFR part 21.

Specially Denatured Rum (S.D.R.) is a rum that has been denatured following the formula specified in subpart D of 27 CFR part 21. S.D.R. may be used only for the uses specified for that formula in 27 CFR part 21.

Specially Denatured Spirits (S.D.S.) are specially denatured alcohol (S.D.A.) and/or specially denatured rum (S.D.R.). Only a registered distilled spirits plant may produce S.D.S. TTB and industry generally refer to formulations of S.D.S. by the formula number. For example, a formulation produced in accordance with S.D.A. Formula No. 40-B is simply referred to as “S.D.A. 40-B.” To reflect the common parlance, this same shorthand is used throughout this document.

Notice of Proposed Rulemaking

On June 27, 2013, TTB published Notice No. 136 in the Federal Register (78 FR 38628) to propose several changes to the regulations to ease burdens on industry members and on TTB, as well as other improvements and clarifications. While a more detailed description of those proposals can be found in Notice No. 136, TTB provides a general summary below:

Removal of Certain S.D.A. Formulas

In Notice No. 136, TTB proposed to remove, from part 21, 16 S.D.A. formulas that do not appear to be in use—specifically, S.D.A. Formula Nos. 2-C, 3-B, 6-B, 17, 20, 22, 23-F, 27, 27-A, 27-B, 33, 38-C, 39, 39-A, 42, and 46. In addition to proposing to remove those 16 formulas, TTB also proposed to remove references to those formulas from part 21, as well as references to, and any specifications for, denaturants that are prescribed by those 16 formulas and are not mentioned in other formulas.

Reclassification of Certain S.D.A. Formulas as C.D.A. Formulas

TTB identified two S.D.A. formulas that TTB could reclassify as C.D.A. formulas, because it would be very difficult to separate the denaturant from the alcohol in the resulting formulation. TTB proposed to reclassify S.D.A. Formula Nos. 12-A and 35 as C.D.A. formulas by removing 27 CFR 21.40 and 21.61 and by adding new 27 CFR 21.21a and 21.25 respectively. TTB also proposed to remove other references to these two S.D.A. formulas from part 21.

General-Use Formula for Articles Made With Certain S.D.A. Formulations

TTB also determined that it would be appropriate to issue a new, multi-purpose general-use formula for any appropriate articles made with one or more of 15 S.D.A. formulations that TTB identified as being appropriate for the general-use formula. Such a general-use formula would alleviate paperwork burdens for both industry members and TTB, because the manufacturer of an article produced in accordance with a general-use formula is not required to obtain specific formula approval from TTB on Form 5150.19. Furthermore, because it would be difficult to separate the alcohol from the articles produced using one or more of those 15 S.D.A. formulations, the revenue would not be jeopardized. Accordingly, TTB proposed to specify S.D.A. Formula Nos. 1, 3-A, 13-A, 19, 23-A, 23-H, 30, 32, 35-A, 36, 37, 38-D, 40, 40-A, and 40-B in a multi-purpose general-use formula in new 27 CFR 20.120.

General-Use Formulas, With Conditions, for Certain Articles Made With S.D.A. Formulas

TTB also identified three S.D.A. formulations that may be used as ingredients, subject to certain conditions, in certain general-use formulas. Accordingly, TTB proposed:

• To allow the use of S.D.A. 18 in a vinegar general-use formula in new 27 CFR 20.121 (which would have as a condition that the ethyl alcohol either loses its identity in the vinegar-making process or only residual ethyl alcohol within the limit specified in 27 CFR 20.104 remains);

• To allow the use of S.D.A. 39-C in a new general-use formula in 27 CFR 20.122 (which would have as a condition that each gallon of finished product contain not less than 2 fluid ounces of perfume material); and

• To provide for the use of S.D.A. 40-C in a pressurized container general-use formula in new 27 CFR 20.123 (which would have as a condition that the formula only be used in the manufacture of products that will be packaged in pressurized containers in which the liquid contents are in intimate contact with the propellant and from which the contents are not easily removable in liquid form).

Only the uses that are currently approved for the corresponding S.D.A. formula in part 21 would be allowed under each of these three new general-use formulas.

TTB also proposed to remove 27 CFR 20.103 from the regulations. Section 20.103 requires that articles made with S.D.A. 39-C contain at least two fluid ounces of perfume material in each gallon of finished product. Because this condition will appear in the general-use formula specified in the new § 20.122, and because the new general-use formula covers all articles made with S.D.A. 39-C, the condition is no longer needed in § 20.103.

Additional Changes to Formulas

In addition to the changes discussed above, TTB proposed to:

• Create a general-use formula for duplicating fluids and ink solvents specifying S.D.A. 1, 3-A, and 3-C in new 27 CFR 20.124; and

• Amend the proprietary solvents general-use formula (27 CFR 20.113) to also allow the use of S.D.A. 3-C in making proprietary solvents.

TTB also proposed to remove benzene—which the U.S. Environmental Protection Agency (EPA) has designated in its regulations as a hazardous air pollutant under the Clean Air Act (40 CFR 61.01(a))—as a denaturant prescribed in S.D.A. Formula No. 2-B (27 CFR 21.33), and to exclude benzene from the denaturants prescribed by the new C.D.A. Formula No. 12-A in proposed § 21.21a. While TTB also proposed to remove benzene from the list of authorized denaturants in 27 CFR 21.151, TTB did not propose to remove the specifications for benzene contained in 27 CFR 21.97. TTB will remove § 21.97 in this rule because the benzene specifications are no longer needed.

Other Substantive Changes

In addition to the changes to the S.D.S. and C.D.A formulas, denaturant specifications, and general-use formulas, TTB also proposed the following changes to the regulations to provide greater flexibility to industry members:

• To clarify the regulations relating to the destruction of S.D.S. or recovered alcohol, TTB proposed to amend 27 CFR 20.222 to state that destruction of recovered material that is not sufficiently denatured to meet the formula specifications of an article must be done by the original manufacturer, a distilled spirits plant, or a facility that possesses an S.D.S. dealer's permit.

• TTB proposed to amend 27 CFR 20.63 to allow any permittee to adopt, for use at any of its plants, any formula previously approved for use at another of its plants, or any formula previously approved for its parent or wholly-owned subsidiary.

• TTB proposed to amend § 20.102 to except bay rum, alcoholado, and alcoholado-type toilet waters produced under an approved formula and endorsed “For Export Only” from the requirement that they be produced from the materials specified in that section.

• To make the regulations on reagent alcohol less restrictive, TTB proposed to amend 27 CFR 20.117 to allow permittees who have a legitimate use for reagent alcohol in manufacturing to receive it for that purpose, but only from distilled spirits plants and S.D.S. user or dealer permittees. TTB also proposed to amend § 20.117(a) to provide for treatment of reagent alcohol as S.D.A. when distributed for use in manufacturing.

• TTB proposed to amend 27 CFR 20.134 to allow containers of articles to either (1) bear a label or (2) have the required information etched or printed directly on the containers, since the technology now exists to etch or print information directly on containers.

• TTB proposed to amend the regulations by adding a new 27 CFR 20.183 which would allow for the exportation of most S.D.S. formulations by dealers provided that the S.D.S. conforms to a formula specified in part 21 of the TTB regulations, that the exportation is to a country, the laws of which allow the importation of such spirits, and that the dealer notifies TTB of the exportation.

• TTB proposed to add new § 20.193 (27 CFR 20.193) to allow for the export of articles that would not be approved for domestic distribution. Previously, TTB and its predecessor agency, the Bureau of Alcohol, Tobacco, and Firearms (ATF), provided for such exports on individual bases as alternate methods or procedures.

Clarifying and Technical Changes

In Notice No. 136, TTB proposed several technical changes, as well as changes to clarify the regulations, and TTB is finalizing those changes in this rulemaking.

Comments Received and TTB Responses

TTB received a total of four comment submissions in response to Notice No. 136, from Archer Daniels Midland Company (ADM) (Comment 1), an individual who works in industry (Comment 2), Videojet Technologies, Inc. (“Videojet”) (Comments 3a through 3d), and the Renewable Fuels Association (RFA) (Comment 4). All comments appear on “Regulations.gov,” the Federal Rulemaking portal, at http://www.regulations.gov, in Docket No. TTB-2013-0005.

Comment 1

ADM's comment submission (Comment 1) included nine specific comments. One of those comments expressed support for the clarification regarding the importation of denatured spirits and fuel alcohol in § 27.222. ADM's eight other comments, and TTB's responses, are as follows:

ADM comment: ADM stated that the current general-use formulas (§§ 20.112 through 20.118) “are prescriptive in that they detail what denaturants and amounts must be added to the applicable S.D.A.,” but the general-use formula proposed in § 20.120 is “less prescriptive in that it only states that an additional denaturant must be added.” ADM noted their concern that the proposed formula could be misinterpreted, which would result in inadvertent noncompliance.

TTB response: General-use formulas do not specify denaturants that must be used in producing an article. Rather, they specify which type of S.D.A. must be used to produce the article. It is the S.D.A. that contains the denaturants, per the S.D.A. formula provided in 27 CFR part 21. Some of the general-use formulas also specify additional ingredients that must be used, but not all of the existing general use-formulas specify exact quantities of additional ingredients. For example, the existing tobacco flavor general-use formula (§ 20.114) only requires the use of S.D.A. Formula No. 4 or S.D.R. Formula No. 4 and “sufficient flavors,” and the existing ink general-use formula in § 20.115 only requires the use of one of several specified S.D.A. formulations and “sufficient pigments, dyes, or dyestuffs.” The permissiveness of the general-use formula proposed in the new § 20.120 is consistent with TTB's longstanding approach. This approach provides manufacturers with a degree of flexibility in producing articles—which minimizes the paperwork burden imposed on both manufacturers and TTB—while still protecting the revenue. Therefore, TTB will finalize the general-use formula in § 20.120 as proposed.

ADM comment: ADM noted that the names of existing general-use formulas describe the type of article that is produced in accordance with the general-use formula. ADM recommended that TTB assign a similar type of name to the general-use formula proposed in new § 20.120.

TTB response: Many kinds of articles may be produced in accordance with the general-use formula proposed in new § 20.120, making it impractical to assign a name to the general-use formula based on the resulting articles. However, TTB has reconsidered calling the general-use formula the “General-use formula for articles made with S.D.A. 1, 3-A, 13-A, 19, 23-A, 23-H, 30, 32, 35-A, 36, 37, 38-D, 40, 40-A, or 40-B,” and instead has determined that “Multi-purpose general-use formula” is less cumbersome. Accordingly, TTB has changed the name of that general-use formula to “Multi-purpose general-use formula” in this document.

ADM comment: ADM believes that the lists of “Authorized Uses” for the various S.D.A. formulas 27 CFR part 21—which are listed in § 21.141 and in section (b) of each section of part 21 subpart D—are overly lengthy, overly specific, and in some cases redundant or repetitive. ADM asked that TTB limit the “Authorized Uses” lists to more general usage categories such as “ingredient in personal care product” or “process aid in food production.”

TTB response: Though TTB sees the value in revising the lists of “Authorized Uses,” such a revision is outside the scope of the regulatory changes published in the Notice No. 136. TTB will consider such revisions for a future rulemaking.

ADM comment: ADM echoed one of the comments made in response to Notice No. 83, a comment that TTB discussed in Notice No. 136. Specifically, the comments relate to TTB's specification of exact amounts of denaturants in C.D.A. and S.D.A. formulas. ADM noted that “it is not practical to expect and impossible to ensure that the exact amounts of denaturants have been added,” and asked TTB to “provide clarification in the regulations regarding acceptable variability in denaturant addition” by using “action levels” in enforcement or applying standard rounding rules.

TTB response: TTB applies a plus or minus five percent tolerance when analyzing samples of S.D.A., C.D.A., and articles to determine compliance with the formula. TTB also employs standard rounding rules when reviewing results of analyses, where a number is rounded up if the first digit after the last significant digit is “5” or more, and a number is rounded down if the first digit after the last significant digit is “4” or less. For example, if TTB were examining an article made pursuant to a formula specifying a mixture of 90 percent by volume S.D.A. 3-C and 10 percent by volume n-propyl acetate, taking into consideration the plus or minus five percent tolerance, the acceptable range of S.D.A. 3-C in the article would be 85.5-94.5 percent by volume. If laboratory analysis of the article showed that the article contains 85.45 percent S.D.A. 3-C, TTB would round that result to 85.5 percent, which would be in compliance with the formula. If laboratory analysis showed that the article contains 85.44 percent S.D.A. 3-C, TTB would round that result to 85.4 percent, which would be out of compliance with the formula.

Accordingly, TTB is adding a new paragraph (d) to both 27 CFR 21.21 and 21.31 to state the analytical tolerance and the use of standard rounding rules. TTB also applies the plus or minus five percent tolerance and standard rounding rules when analyzing samples of articles that were made pursuant to a formula that specified an exact amount of an ingredient, including denatured spirits. Accordingly, TTB is revising 27 CFR 20.132 to state the analytical tolerance and the use of standard rounding rules. TTB believes that the plus or minus five percent tolerance and the application of standard rounding rules provide for a reasonable degree of variation.

ADM comment: ADM asked TTB to consider modifying labeling requirements as described in 27 CFR 20.134, concerning the labeling of articles, and 20.146, concerning labels on bulk containers of C.D.A., because “it is not general practice to label transport containers with product name, manufacturer name, etc.,” and “in the case of rail and truck tankers, containers are placarded per [Department of Transportation (DOT)] regulations and product information is listed on shipping paperwork. Any identification beyond that stipulated by the DOT for first responders could easily decrease the security of the product in transit.”

TTB response: As ADM stated, TTB did not specifically address this labeling issue in Notice No. 136. Therefore, TTB cannot make substantive changes to those sections in this document, as they are outside the scope of this rulemaking. However, as ADM noted, §§ 20.134 and 20.146 do not specifically address large transport containers such as truck tankers, railcars, or barges. TTB notes that in 27 CFR 19.495, for bulk conveyances of spirits or denatured spirits—which would include containers such as truck tankers, railcars, and barges—TTB allows a label containing the information required by TTB to be securely attached to the route board or another equivalent device. TTB would not object to bulk conveyances of articles or C.D.A. having a label in a manner consistent with § 19.495.

ADM comment: ADM opposed the addition to the regulations of specifications for five new denaturants (high octane denaturant blend, at § 21.112c; naphtha, at § 21.118b; natural gasoline, at § 21.118c; raffinate, at § 21.124a; and straight run gasoline, at § 21.130a) for use in fuel ethanol. ADM asserted that, because of the specific nature of some of the analytical requirements listed with those denaturants, it is not clear that they are commercially available. ADM stated that denaturants listed in the regulations should be available to all industry members. In addition, ADM requested that if TTB finds it necessary to list denaturant specifications, TTB publish them someplace other than in the regulations, asserting that it is easier to change another type of publication than it is the regulations.

TTB response: Industry members may, under 27 CFR 21.91, request that TTB authorize substitute denaturants. To approve a material as a denaturant for a denatured alcohol formula, TTB must determine that (1) the proposed material, when added to spirits (ethanol), makes the ethanol “unfit for beverage or internal human medicinal use;” (2) the use of the proposed material as a substitute denaturant will be adequate to protect the Federal excise tax revenue; and (3) the proposed material is suitable for the intended use. If the material meets these criteria, TTB will authorize the use of the material as a denaturant in making specified C.D.A. or S.D.S. formulations so that the requestor and any other interested industry members may use the material as a denaturant. In order to provide more flexibility to industry, TTB believes that it is appropriate to authorize use of denaturants that meet the criteria. We do not specify as a criterion that the denaturant must be widely available in the commercial market.

However, if an industry member believes that TTB should deauthorize a particular denaturant, we will consider, based on the criteria stated above, a petition submitted by any interested person stating the reasons it believes authorization is not appropriate. Furthermore, the specification of a denaturant in the regulations does not foreclose any interested person from applying for an alternate method or procedure or any denaturer from requesting authorization to use other denaturants.

Regarding ADM's comment about publishing the requirements someplace other than in the TTB regulations, we recognize that rulemaking can sometimes be a lengthy process. However, TTB's current practice provides the public with a chance for notice and comment on the proposed requirements. After such notice and comment is given, the appropriate vehicle for codification is publication in the Code of Federal Regulations.

ADM comment: ADM requested that TTB (1) recognize consensus specifications and test methods, such as those maintained by ASTM International (“ASTM”), whenever possible, for the denaturants listed in part 21, and (2) encourage and participate in a stakeholder effort to develop such standards if a consensus standard does not exist for a commercially available denaturant. During the comment period, two commenters, ADM and Videojet, noted that a particular consensus standard appearing in the regulations is obsolete. Thus, they recommended that, if TTB cites a consensus standard, the specific version of the consensus standard not be included in the citation, because standards are issued, updated, and withdrawn on a continual basis. ADM provided as an example the denaturant specifications for unleaded gasoline, as set out in 27 CFR 21.110, which cite ASTM Standard D439-79, but which has been withdrawn by ASTM. ADM asserted that TTB should update this reference.

TTB response: TTB uses consensus standards when appropriate and practicable for the Bureau's purpose. When incorporating in regulations a consensus standard by reference, a Federal agency must specifically identify the incorporated materials and is prohibited from incorporating material dynamically. As specified in 1 CFR 51.1(f), “[i]ncorporation by reference of a publication is limited to the edition of the publication that is approved.”

TTB agrees that § 21.110 should be amended. Moreover, TTB is undertaking a comprehensive review of all the standards incorporated by reference in part 21 to ensure that TTB regulations cite to the current version of the referenced materials. TTB has determined that it is appropriate to make revisions to 27 CFR 21.6, Incorporations by reference, and other sections in part 21 that include incorporations by reference, not only to update the consensus standard references but also to ensure compliance with the Office of the Federal Register's rules in 1 CFR part 5, which were recently revised. See 79 FR 66267, November 7, 2014. Accordingly, TTB will engage in a separate rulemaking to update § 21.6 and the standards incorporated by reference into part 21, including the ASTM standard for unleaded gasoline set forth in 27 CFR 21.110.

ADM comment: Finally, ADM stated its support for TTB's consideration of harmonization of the regulations governing C.D.A. Formula No. 20 and the regulations governing fuel ethanol.

TTB response: TTB will continue to consider such harmonization for a future rulemaking with some other proposed changes to the regulations governing alcohol fuel plants, which are found in 27 CFR part 19, subpart X.

Comment 2

Loren Lowy, an individual who works in industry, expressed support for TTB's designation of S.D.A. Formula No. 3-A as an S.D.A. formulation that is appropriate for the new general-use formula in new § 20.120, because it will ease the regulatory burden on industry by removing the requirement for article formula approval on TTB Form 5150.19 for articles made with formulations of S.D.A. 3-A. He also expressed support for TTB's revision to § 20.63 to expand the adoption of formulas by parent or subsidiary corporations.

Lowy also noted a conflict between the proposed new general-use formula in new § 20.120 and the treatment of reagent alcohol in the proposed revision to § 20.117. Specifically, Lowy explained that there is a contradiction because, under the proposed § 20.120, an article formula is not required for any article made with formulations of S.D.A. 3-A. However, under the proposed § 20.117, reagent alcohol—which is made with 95 parts (by volume) of S.D.A. 3-A, and 5 parts (by volume) of isopropyl alcohol—is to be treated as S.D.A. unless distributed and used in accordance with that section.

Lowy also posed the following questions regarding the treatment as S.D.A. of reagent alcohol that is not distributed and used in accordance with the proposed revised § 20.117:

• Whether reagent alcohol in manufacturing would be included in the annual S.D.A. usage report;

• If so, whether it would be a separate entry from the S.D.A.;

• Whether the report form would change to reflect any necessary separate entries; and

• Whether the total volume of reagent alcohol should be reported or just the S.D.A. 3-A portion of the reagent alcohol.

TTB response: The new multi-purpose general-use formula specified in § 20.120 requires that any article made pursuant to that general-use formula contain sufficient additional ingredients to definitely change the composition and character of the S.D.A. used to make the article in question, and to ensure that the finished article is unfit for beverage or other internal human use and cannot be reclaimed or diverted to beverage use. Reagent alcohol does not contain such sufficient additional ingredients, and so the multi-purpose general-use formula is not applicable. Therefore, TTB is adding paragraph (d) to § 20.120 to provide that the multi-purpose general-use formula may not be used for the production of any articles that conform to another general-use formula in part 20, subpart F. This clarification will prevent any other article that is subject to restrictions in another general-use formula from being manufactured or distributed under the multi-purpose general-use formula without being subject to the restrictions of the other general-use formula.

In response to the commenter's additional questions, TTB notes that reagent alcohol used in manufacturing should be included in the annual S.D.A. usage report. Because reagent alcohol used in manufacturing is to be treated as S.D.A., it would not be a separate entry from S.D.A. Thus, the report will not be changed. Again, because reagent alcohol used in manufacturing is to be treated as S.D.A., the total volume of reagent alcohol should be reported in the annual S.D.A. usage report.

Comment 3a

Videojet disagreed with the new definition of “Fit for beverage use, or fit for beverage purposes” in § 20.11, in that it states that the determination of fitness or unfitness for beverage use would be “based solely on the composition of the product and without regard to extraneous factors such as price, labeling, or advertising.” Accordingly, Videojet requested that TTB remove that portion of the definition. Videojet asserted that labeling is definitive because it communicates the intended use of each formulation, that consumer use is prohibited, and, in some cases, it indicates whether a product is poisonous or hazardous to health.

TTB response: With limited exceptions, spirits that are fit for beverage use are subject to Federal excise tax. Reliance on product labeling, rather than product composition, in determining unfitness for beverage use could create a significant jeopardy to the revenue. It would be possible to evade payment of excise taxes due on distilled spirits by labeling the spirits as not intended for beverage use, and then diverting them to beverage use. Accordingly, to protect the revenue, TTB will finalize the definition of “Fit for beverage use, or fit for beverage purposes” as proposed in Notice No. 136, which states that the determination of fitness or unfitness will be “based solely on the composition of the product and without regard to extraneous factors such as price, labeling, or advertising.”

Comment 3b

Videojet's next comment related to TTB's clarification of § 20.95, concerning developmental samples of articles. Videojet first noted an inconsistency in the proposed text, where it limits the number of samples to one per customer, but requires that a record of the number of samples sent to each customer be kept. Videojet explained that a product test may require more than one container of an article (like a printer cartridge filled with ink), which would exceed the limitation in § 20.95 that only one sample of each formulation may be sent to each customer. Videojet also explained that customers often prefer a two-stage approval process for testing a product, which would exceed the limitation in § 20.95 that samples be sent on a one-time basis.

TTB response: TTB will retain the limitation of one sample per customer and authorize that samples may only be sent on a one-time basis, to ensure protection of the revenue. Allowing manufacturers to send an unlimited number of samples to customers multiple times would effectively allow manufacturers to distribute articles for which there is no formula approval. Since many articles will be able to be produced under a general-use formula and would not require formula approval on TTB Form 5150.19, this limitation will not affect many articles. In addition, where articles cannot be produced in accordance with a general-use formula, manufacturers may send unlimited numbers of samples if they first obtain formula approval on TTB Form 5150.19. However, TTB is removing from § 20.95 the requirement that a record of the number of samples sent to each customer be kept, since that number will not exceed one.

Comment 3c

Videojet had several detailed comments about TTB's proposed revisions to § 20.115 and proposed new §§ 20.124 and 20.120, as follows:

Videojet comment: Videojet noted an apparent typographical error in the proposed revision to § 20.115, which in Notice No. 136 was proposed to say that the “ink general-use formula authorizes the production of any finished article made with alcohol denatured in accordance with S.D.A. Formula No. 1, 3-A, 3-C, 13-A, 23-A, 30, or 32, or which . . . [c]ontains pigments, dyes, or dyestuffs sufficient to ensure that the article is unfit for beverage use . . . .”

TTB response: The second use of the word “or” in the proposed regulation was a typographical error, which TTB is correcting in this final rule.

Videojet comment: Videojet asked that the TTB expand the list of S.D.A. formulations that are specified in the ink general-use formula in section 20.115, to include S.D.A. Formula Nos. 35-A, 40-B, and 45. Videojet also asked that TTB add the use code for inks (use code 052) to §§ 21.62(b)(1), 21.76(b)(1), and 21.80(b)(1), and add references to S.D.A. Formula Nos. 35-A, 40-B, and 45 to the table in § 21.141.

TTB response: TTB has determined that formulations of S.D.A. Formula Nos. 35-A and 40-B would be appropriate in the ink general-use formula in § 20.115, and would not create a threat to the revenue as part of the general-use formula. Because industry members are using formulations of S.D.A. Formula Nos. 35-A and 40-B to manufacture inks, TTB will add references to those formulas to the list of S.D.A. formulations specified in the ink general-use formula in § 20.115. However, TTB has determined that it will not add S.D.A. Formula No. 45 to the general-use formula because that formula—which specifies the addition of 300 pounds of refined whole or orange shellac to every 100 gallons of alcohol—is not, to TTB's knowledge, typically used in manufacturing inks, and is currently only authorized for use in manufacturing candy glazes. S.D.A. users may continue to seek approval from TTB to manufacture ink using formulations of S.D.A. Formula No. 45 by filing TTB Form 5150.19.

Videojet comment: As proposed in Notice No. 136, inks manufactured in accordance with the general-use formula specified in § 20.115 would be required to contain “pigments, dyes, or dyestuffs sufficient to ensure that the article is unfit for beverage use.” Videojet noted that although one or more of those ingredients are present in ink, there are other ingredients that may be present that may serve to further render the ink unfit for beverage use. Accordingly, Videojet asked TTB to require that inks manufactured in accordance with the general-use formula contain “pigments, dyes, or dyestuffs, solvents, or other ingredients sufficient to ensure that the article is unfit for beverage use.”

TTB response: TTB agrees that other ingredients used in manufacturing ink may render the ink unfit for beverage use. However, Videojet's proposed modification to § 20.115 would allow for an ink to contain no pigments, dyes, or dyestuffs. Accordingly, TTB will modify § 20.115 to require that inks manufactured in accordance with the general-use formula contain “pigments, dyes, or dyestuffs, which, alone or in combination with solvents or other ingredients, are sufficient to ensure that the article is unfit for beverage use.”

Videojet comment: Videojet supported the addition of the duplicating fluid and ink solvent general-use formula in § 20.124, but asked TTB to harmonize the ink general-use formula with the duplicating fluid and ink solvent general-use formula because in some cases ink and ink solvent must be combined in a printer. Specifically, Videojet asked TTB to add S.D.A. 13-A, 23-A, 30, 32, 35-A, 40-B, and 45 to the list of S.D.A. formulations authorized by the duplicating fluid and ink solvent general-use formula.

TTB response: To reduce the compliance burden on S.D.A. users that manufacture duplicating fluids and ink solvents, TTB will add S.D.A. 13-A, 23-A, 30, 32, 35-A, and 40-B to the list of S.D.A. formulations authorized by the duplicating fluid and ink solvent general-use formula. TTB will also add use code 485 (miscellaneous solutions) to §§ 21.41, 21.59, 21.62, and 21.76 to authorize formulations of S.D.A. Formula Nos. 13-A, 32, 35-A, and 40-B in the manufacture of miscellaneous solutions, and will add S.D.A.13-A, 32, 35-A, and 40-B to the entry for use code 485 in the chart in § 21.141. S.D.A. Formula Nos. 23-A and 30 are already authorized for use in miscellaneous solutions (use code 485). However, TTB has determined not to add S.D.A. Formula No. 45 to the general-use formula because that formula is not, to TTB's knowledge, typically used in manufacturing duplicating fluids or ink solvents, and is currently only authorized for use in manufacturing candy glazes. S.D.A. users may continue to seek approval from TTB to manufacture ink using formulations of S.D.A. Formula No. 45 by filing TTB Form 5150.19.

Videojet comment: Videojet stated that, while the proposed duplicating fluid and ink solvent general-use formula stipulates specific further denaturants (n-propyl acetate, isopropyl alcohol, or methyl alcohol), “it is generally not feasible to add [those] specific solvents to the ink solvent formulation due to the intrinsic connection between the ink formula and the ink solvent formula.” Accordingly, Videojet asked that TTB instead allow for the use of “pigments, dyes, dyestuffs, solvents or other ingredients sufficient to ensure that the article is unfit for beverage use” as an alternative to n-propyl acetate, isopropyl alcohol, or methyl alcohol.

TTB response: TTB often receives requests for formula approval that specify the use of n-propyl acetate, isopropyl alcohol, or methyl alcohol in duplicating fluids or ink solvents. Therefore, it is feasible for at least some industry members to use those ingredients in duplicating fluids and ink solvents. The duplicating fluid and ink solvent general-use formula also allows the resulting article to contain additional ingredients not specified in the general-use formula, so a manufacturer is not precluded from adding dyes to the solvent. TTB believes that it is appropriate to maintain the requirement that duplicating fluids and ink solvents produced in accordance with the general-use formula contain n-propyl acetate alone or in combination with isopropyl alcohol or methyl alcohol. S.D.A. users may still submit requests for formula approval on TTB Form 5150.19 for articles that do not conform to this general-use formula.

Videojet comment: Videojet also asked TTB to add S.D.A. Formula No. 3-C to the general-use formula in § 20.120 because doing so would reduce the regulatory burden on industry and on TTB without threatening the revenue.

TTB response: TTB believes that it would be inappropriate to include S.D.A. Formula No. 3-C in the general purpose general-use formula in § 20.120. The current and proposed general-use formulas that specify S.D.A. 3-C (special industrial solvents, duplicating fluids and ink solvents, ink, and toilet preparations) also specify certain other ingredients to ensure that the resulting article is unfit for beverage use. To ensure adequate protection of the revenue, the Bureau believes it is appropriate to continue reviewing formulas for other articles made with S.D.A. 3-C.

Videojet comment: Videojet next asked TTB to authorize the use of formulations of S.D.A. Formula Nos. 13-A, 19, 32, and 35-A in cleaning solutions.

TTB response: TTB has received no data to support authorizing the use of formulations of S.D.A. Formula Nos. 13-A, 19, 32, and 35-A in cleaning solutions. Since 1991, when TTB began its practice of electronic recordkeeping, no requests have been received for the use of formulations of S.D.A. Formula Nos. 13-A, 19, 32, and 35-A in cleaning solutions, which suggests that industry members are not interested in those formulations for that purpose. However, TTB will consider authorizing those S.D.A. formulations for use in cleaning solutions in the future if TTB receives sufficient information to support doing so.

Videojet comment: Videojet also asked that, in § 20.120, TTB remove the requirement that only additional ingredients other than the denaturants prescribed for the applicable S.D.A. formulas be added to the article to definitely change the composition and character of the S.D.A. used to make the article and to ensure that the finished article is unfit for beverage use.

TTB response: An article that is made by taking an S.D.A. formulation and adding more of the denaturant that was used to make the S.D.A. has the same character and very similar composition of the S.D.A. Additional ingredients used to manufacture an article in accordance with the multi-purpose general-use formula in § 20.120 must substantially change the nature of the S.D.A. Accordingly, TTB will maintain the requirement that an article produced in accordance with the multi-purpose general-use formula contain additional ingredients beyond the denaturant used in the S.D.A.

Videojet comment: Finally, Videojet noted that if an article is manufactured under the general-use formula specified in § 20.120 by combining two S.D.A. formulations and an additional ingredient, the article must conform to a use code that is authorized for both S.D.A. formulations. In contrast, an article that is manufactured by combining one S.D.A. formulation with an intermediate ingredient that is itself comprised of the second S.D.A. formulation and the additional ingredient, the article would only have to conform to a use code that is authorized for the S.D.A. formulation that is not used in the intermediate ingredient.

TTB response: By law (26 U.S.C. 5242), denaturing materials must be suitable for the intended use. To help ensure this, TTB will continue to require that an article made under the multi-purpose general-use formula with multiple S.D.A. formulations conforms to a use code that is authorized for all of the S.D.A. formulations used. Manufacturers using multiple S.D.A. formulations to produce an article may seek formula approval from TTB on TTB Form 5150.19 if the intended use of the article is not covered by a use code that is authorized for all of the S.D.A. formulations being used. In the case of intermediate articles being used in the manufacture of another article, the intermediate article must be suitable for that intermediate use.

Comment 3d

Videojet also raised some concerns related to other national and international standards, as follows:

Videojet comment: Videojet noted that other Federal agencies, like the Occupational Safety and Health Administration (OSHA), also maintain rules concerning the communication of hazards.

TTB response: TTB is aware that other Federal agencies maintain rules concerning the labeling and handling of certain chemicals, or products that contain certain chemicals. Section 20.136 currently notes that such rules are implemented by the Consumer Product Safety Commission (CPSC), Federal Trade Commission (FTC), and Food and Drug Administration (FDA). The labeling requirements specified in TTB's regulations for articles that would contain methanol if produced in accordance with certain general-use formulas (specifically, the special industrial solvents general-use formula, proprietary solvents general-use formula, reagent alcohol general use formula in §§ 20.112, 20.113, and 20.117, and the proposed duplicating fluid and ink solvent general-use formula in § 20.124) were derived from CPSC requirements found in 16 CFR 1500.14(b)(4). TTB believes that industry will be aided in complying with all applicable labeling regulations if TTB refers in its regulations to the applicable labeling regulations of other Federal agencies. TTB believes that the best approach is to refer to those other applicable Federal labeling requirements in part 20. Accordingly, TTB is revising § 20.136 to reference the labeling regulations of other Federal agencies, and is removing the labeling requirements from §§ 20.112, 20.113, 20.117, and 20.124.

Videojet comment: Videojet also noted that the United Nations (UN) Globally Harmonized System of Classification and Labelling of Chemicals (GHS) uses the acronym “SDS” to refer to “safety data sheet.” Videojet asked TTB to consider whether TTB's “S.D.S.” acronym for “specially denatured spirits” would be confusing given the prevalence of the acronym “SDS” in the UN GHS.

TTB response: Many widely used acronyms abbreviate a term despite being identical to an acronym that abbreviates a different term. Readers can usually determine which term an acronym is abbreviating based on the context in which it is being used. Accordingly, TTB will continue using the abbreviation “S.D.S.” for “specially denatured spirits” in its regulations.

Comment 4

RFA made several points in its comment submission. The comments, and TTB's responses, are as follows:

RFA comment: RFA expressed support for TTB's effort toward a future rulemaking that would harmonize the denaturant specifications for C.D.A. Formula No. 20 and fuel alcohol.

TTB response: As stated above in response to ADM's similar comment, TTB will continue to consider such harmonization for a future rulemaking.

RFA comment: RFA, noting the outdated denaturant specifications for unleaded gasoline, recommended that TTB base denaturant specifications on consensus standards, like those developed by ASTM, instead of providing specifications. As mentioned above, RFA also recommended that TTB maintain its list of denaturants and the specifications for those denaturants in a place other than the regulations and update the list as needed, because updating regulations is a lengthy process.

TTB response: As explained above in response to ADM's similar comments, under Federal regulations, a Federal agency must identify the specific version of the consensus standard incorporated by reference into its particular regulations. TTB will engage in a separate rulemaking to update references to outdated consensus standards appearing in part 21.

RFA comment: RFA stated that it is important that denaturant specifications in the TTB regulations represent a commercially available material, and that the authorized denaturants “conform to very stringent requirements of both state and Federal regulations for motor fuels and fuel additives.”

TTB response: Regarding commercial availability, as noted above in response to one of ADM's comments, TTB may authorize denaturants that conform to certain specifications upon receipt of a petition. If an industry member believes that TTB should change or deauthorize a particular denaturant or its specifications, the industry member should submit to TTB a petition for the change that provides information about why TTB should make the change. Regarding conformity with State and Federal regulations for motor fuels and fuel additives, TTB tries to be consistent with other Federal regulations. As this document explains, TTB's statutory authority in regulating denatured alcohol pertains to protecting the Federal excise tax revenue. Accordingly, TTB's determinations will primarily be based on revenue protection considerations. Ultimately, industry members remain responsible for ensuring compliance with State and other Federal regulations.

RFA comment: RFA recommended that TTB remain open to approving denaturants of non-hydrocarbon origin.

TTB response: TTB will consider authorizing denaturants of non-hydrocarbon origin. Under the authority of 27 CFR 21.91, the appropriate TTB officer may, pursuant to written application filed by the denaturer, authorize the use of substitute denaturants if such substitution will not jeopardize the revenue. An industry member who would like TTB to authorize a substitute denaturant should submit a request to TTB for authorization of the denaturant pursuant to § 21.91.

RFA comment: RFA supported the clarification of jurisdiction over imported denatured spirits and fuel alcohol. RFA noted that TTB should provide clarity for the regulatory requirements in support of unfettered transportation and use of fuel alcohol.

TTB response: TTB is adding new § 27.222 to the regulations to help clarify the regulations regarding the importation of denatured spirits. TTB welcomes petitions for additional regulatory changes that industry members feel are needed.

TTB Finding

After careful review of the comments discussed above, TTB is finalizing the proposed amendments, with the adjustments explained above. In addition, TTB is altering some of the section numbers proposed in Notice No. 136 to conform to Office of Federal Register policies. Specifically, proposed §§ 21.21a, 21.94a, 21.105a, 21.105b, 21.106a, 21.108a, 21.112a, 21.112b, 21.112c, 21.115a, 21.115b, 21.118a, 21.118b, 21.118c, 21.121a, 21.124a, and 21.130a are being finalized as 27 CFR 21.26, 21.94-T, 21.105-T1, 21.105-T2, 21.106-T, 21.108-T, 21.112-T1, 21.112-T2, 21.112-T3, 21.115-T1, 21.115-T2, 21.118-T1, 21.118-T2, 21.118-T3, 21.122, 21.124-T, and 21.130-T. Finally, TTB is making a number of technical corrections to existing regulations, beyond those that were proposed in Notice No. 136. These technical corrections merely update or clarify the application of those provisions and do not change the Bureau's interpretation of any regulation or the requirements of any recordkeeping provision.

• One technical correction concerns the use of S.D.S. in foreign-trade zones. Section 484F of the Customs and Trade Act of 1990, Public Law 101-382, 104 Stat. 706, 710, enacted on August 20, 1990, amended 19 U.S.C. 81c(c) by eliminating the requirement that specially denatured spirits used in a foreign-trade zone come from domestic sources. Accordingly, TTB is amending 27 CFR 19.427 to conform with this statutory change.

• TTB is updating additional OMB control numbers in 27 CFR 20.22, 20.56, 20.57, 20.60, 20.61, 20.62, 20.68, 20.142, 20.149, 20.163, 20.170, 20.171, 20.172, 20.180, 20.192, 20.202, 20.203, 20.212, 20.216, 20.231, 20.232, 20.234, 20.235, 20.251, 20.252, 20.261, 20.262, 20.263, and 20.265 to reflect the change from ATF to TTB.

• TTB is amending 27 CFR 20.11 and 20.20 to clarify that references to “TTB Order 1135.20” are to the most recent version of that order, which is not necessarily the original version.

• Typographical errors are corrected in 27 CFR 20.59, 20.93, 20.100, 20.118, 20.131, 20.163, 21.11, 21.49, 21.64, 21.65, and 21.125.

• In 27 CFR 20.92, the reference to the TTB Bulletin is replaced with a reference to TTB's Web site.

• In 27 CFR 20.112 and 20.113, TTB is replacing the erroneous cross-reference to 27 CFR 21.106 with the correct cross-reference 27 CFR 21.107 for the location of a definition of 85 percent ester content.

• In 27 CFR 20.118, the reference to “Bitrex (THS 839),” which is a registered trade name, has been replaced by the generic term “denatonium benzoate.”

• In 27 CFR 20.191, the last sentence is removed, since TTB Publication 5150.5 is no longer available.

• TTB is amending 27 CFR 21.7 and 21.11 to clarify that references to “TTB Order 1135.21” are to the most recent version of that order, which is not necessarily the original version.

• Finally, TTB is updating the abbreviation for “milliliters” in 20.11 and throughout part 21 from “ml” to “mL” to reflect current usage.

Regulatory Analyses and Notices Executive Order 12866

Certain TTB regulations issued under the IRC, including this one, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required.

Regulatory Flexibility Act

Pursuant to the requirements of the Regulatory Flexibility Act (5 U.S.C. chapter 6) TTB certifies that this final rule will not have a significant economic impact on a substantial number of small entities. The rule updates the regulations to align them with current industry practice, clarifies other regulatory provisions, and reduces the regulatory burden on the alcohol industry as well as TTB, resulting in an estimated 80 percent reduction in the number of article formulas submitted to TTB. Thus, the regulatory changes do not create any additional requirements or burdens on small businesses, and are expected to decrease the regulatory burden on industry members, including small entities. Accordingly, a regulatory flexibility analysis is not required.

Pursuant to section 7805(f) of the Internal Revenue Code, TTB submitted the notice of proposed rulemaking (Notice No. 136, 78 FR 38628, June 27, 2013) to the Chief Counsel for Advocacy of the Small Business Administration (SBA) for comment on the impact of these regulations. The SBA had no comment on the proposed rule.

Finally, as previously mentioned, TTB is making a number of technical corrections to existing regulations in this rulemaking that were not proposed in Notice No. 136. TTB has determined, in accordance with 5 U.S.C. 553(b)(3)(B) that it is unnecessary and contrary to public interest to follow prior public notice and comment procedures with respect to the technical corrections, and 5 U.S.C 553(b) does not apply.

Paperwork Reduction Act

The collections of information in the regulations contained in this final rule have been previously reviewed and approved by the Office of Management and Budget (OMB) in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3504(h)) and assigned control numbers 1513-0011, 1513-0028, 1513-0037, 1513-0061, and 1513-0062. Specific regulatory sections in this final rule that contain collections of information are 27 CFR 19.607, 20.63, 20.95, 20.111, 20.117, 20.133, 20.134, 20.183, 20.193, 20.222, 20.262, 20.263, and 20.264. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid control number assigned by OMB.

Several amendments made in this document reduce information collection burdens. Specifically, certain amendments alter circumstances under which article manufacturers must obtain formula approval using TTB Form 5150.19, Formula and/or Process for Article Made with Specially Denatured Spirits. Information collections associated with Form 5150.19 are currently approved under OMB control number 1513-0011. These amendments reduce required submissions of Form 5150.19, and thus reduce the total burden hours currently estimated for control number 1513-0011 by an estimated 955 burden hours, and an 80 percent reduction in the number of these forms submitted to TTB.

Four categories of amendments will reduce required submissions of Form 5150.19:

• Addition to part 20 of new sections 27 CFR 20.120 through 20.124, setting forth five new general-use formulas covering articles made with 19 different S.D.A. formulations;

• Amended regulations in part 21 that reclassify S.D.A. Formula Nos. 12-A and 35 as C.D.A. formulas;

• Amended 27 CFR 20.113(a) and 20.115, which permit the use of additional S.D.A. formulations in the proprietary solvents general-use formula and ink general-use formula; and

• Amended 27 CFR 20.63, which allows a permittee to adopt, for use at a plant where such use is not specifically approved, one of the permittee's own article formulas previously approved for use at another of the permittee's plants, or to adopt a formula previously approved for a parent or wholly-owned subsidiary.

TTB estimates that, as a result of the amendments, the new annual burden hours will be as follows:

Estimated total annual reporting and/or record keeping burden: 239 hours.

Estimated average annual burden hours per respondent: 0.84 hours.

Estimated number of respondents: 285.

Estimated annual frequency of responses: 1 (one).

One amendment involves an alteration to the information collection currently approved under, OMB control number 1513-0061. The amendment to 27 CFR 20.63 allows a permittee to adopt, for use at a plant where such use is not specifically approved, one of the permittee's own article formulas previously approved for use at another of the permittee's plants, or to adopt a formula previously approved for a parent or wholly-owned subsidiary. Previous to this rulemaking, permittees could adopt formulas under more limited circumstances by submitting a certificate of adoption to TTB, which is an information collection currently approved under control number 1513-0061. Although TTB estimates that the amendment will increase the number of certificates of adoption submitted to TTB under § 20.63, it also proportionally decreases the number of submissions of Form 5150.19 that would have been required absent the amendment. Since the estimated average annual burden per respondent relating to certificates of adoption approved under control number 1513-0061 is smaller than the average annual burden for Form 5150.19 under control number 1513-0011, the amendment reduces the overall burden on permittees. TTB estimates that, as a result of this amendment, the new annual burden under control number 1513-0061 will be as follows:

Estimated total annual reporting and/or record keeping burden: 1,897 hours.

Estimated average annual burden hours per respondent: 0.5 hours.

Estimated number of respondents: 3,794.

Estimated annual frequency of responses: 1 (one).

Other amendments to regulatory sections that involve collections of information do not impact the burden hours associated with those collections. Proposed amendments to 27 CFR 19.607, 20.95, 20.111, 20.117, 20.133, 20.134, 20.193, 20.222, 20.262, 20.263, and 20.264 neither increase nor decrease information collections because the amendments clarify preexisting regulatory requirements and do not otherwise impose new requirements increasing information collection burdens. New 27 CFR 20.183 allows S.D.S. dealers to export S.D.S. and requires such dealers to complete TTB Form 5100.11. TTB estimated that the amendment would not increase submissions of Form 5100.11 because, although the amendment allows an additional category of persons to export, the amendment is not expected to increase demand for exported S.D.S. Thus, the exporters may be different, but the number of exportations is not expected to change. Since TTB is only including an additional category of persons entitled to export S.D.S., and is not increasing information collection burdens associated with exporting S.D.S., the proposed amendment will not impact currently estimated information collection burdens. Information collections associated with the amendments described in this paragraph are currently approved under OMB control numbers 1513-0028, 1513-0037, and 1513-0062. TTB estimates the annual burden hours under these control numbers are as follows:

OMB Control Number 1513-0028:

Estimated total annual reporting and/or record keeping burden: 419 hours.

Estimated average annual burden hours per respondent: 0.76 hour.

Estimated number of respondents: 550.

Estimated annual frequency of responses: 1 (one).

OMB Control Number 1513-0037:

Estimated total annual reporting and/or record keeping burden: 6,000 hours.

Estimated average annual burden hours per respondent: 20 hours.

Estimated number of respondents: 300.

Estimated annual frequency of responses: 20.

OMB Control Number 1513-0062:

Estimated total annual reporting and/or record keeping burden: 1 hour.

Estimated number of respondents: 3,430.

Estimated annual frequency of responses: 1 (one).

TTB received no comments about the information collections approved under OMB control numbers 1513-0011, 1513-0028, 1513-0037, 1513-0061, and 1513-0062 in response to Notice No. 136.

Drafting Information

Karen E. Welch of the Regulations and Rulings Division, Alcohol and Tobacco Tax and Trade Bureau, drafted this document.

List of Subjects in 27 CFR Part 19

Caribbean Basin Initiative, Claims, Electronic funds transfer, Excise taxes, Exports, Gasohol, Imports, Labeling, Liquors, Packaging and containers, Puerto Rico, Reporting and recordkeeping requirements, Research, Security measures, Surety bonds, Vinegar, Virgin Islands, Warehouses.

Part 20

Alcohol and alcoholic beverages, Claims, Cosmetics, Excise taxes, Labeling, Packages and containers, Penalties, Reporting and recordkeeping requirements, Surety bonds.

Part 21

Alcohol and alcoholic beverages, Incorporation by reference.

Part 27

Alcohol and alcoholic beverages, Beer, Cosmetics, Customs duties and inspection, Electronic fund transfers, Excise taxes, Imports, Labeling, Liquors, Packaging and containers, Reporting and recordkeeping requirements, Wine.

Part 28

Aircraft, Alcohol and alcoholic beverages, Armed forces, Beer, Claims, Excise taxes, Exports, Foreign trade zones, Labeling, Liquors, Packaging and containers, Reporting and recordkeeping requirements, Surety bonds, Vessels, Warehouses, and Wine.

Amendments to the Regulations

For the reasons discussed in the preamble, TTB amends 27 CFR parts 19, 20, 21, 27, and 28 as follows:

PART 19—DISTILLED SPIRITS PLANTS 1. The authority citation for part 19 continues to read as follows: Authority:

19 U.S.C. 81c, 1311; 26 U.S.C. 5001, 5002, 5004-5006, 5008, 5010, 5041, 5061, 5062, 5066, 5081, 5101, 5111-5114, 5121-5124, 5142, 5143, 5146, 5148, 5171-5173, 5175, 5176, 5178-5181, 5201-5204, 5206, 5207, 5211-5215, 5221-5223, 5231, 5232, 5235, 5236, 5241-5243, 5271, 5273, 5301, 5311-5313, 5362, 5370, 5373, 5501-5505, 5551-5555, 5559, 5561, 5562, 5601, 5612, 5682, 6001, 6065, 6109, 6302, 6311, 6676, 6806, 7011, 7510, 7805; 31 U.S.C. 9301, 9303, 9304, 9306.

2. Section 19.412 is added under the undesignated center heading “Receipt of Spirits from Customs Custody” to read as follows:
§ 19.412 Importation of denatured spirits.

For provisions relating to the importation of denatured spirits, see § 27.222 of this chapter.

3. In § 19.427, paragraph (a)(2) is revised to read as follows:
§ 19.427 Removal of denatured spirits and articles.

(a) * * *

(2) A proprietor may transfer specially denatured spirits to qualified users located in a foreign trade zone for use in the manufacture of articles under part 20 of this chapter.

4. Section 19.607 is revised to read as follows:
§ 19.607 Article manufacture records.

Each processor qualified to manufacture articles must maintain daily manufacturing and disposition records, arranged by the name and authorized Use Code of the article, in the manner provided in part 20 of this chapter.

5. Section § 19.746 is amended by revising paragraphs (b)(1)(xi) and (b)(1)(xii), adding paragraphs (b)(1)(xiii) through (b)(1)(xvi), and revising paragraph (c) to read as follows:
§ 19.746 Authorized materials.

(b) * * *

(1) * * *

(xi) Naphtha;

(xii) Straight run gasoline;

(xiii) Alkylate;

(xiv) High octane denaturant blend;

(xv) Methyl tertiary butyl ether; or

(xvi) Any combination of the materials listed in paragraphs (b)(1)(i) through (xv) of this section;

(c) Specifications. Specifications for the materials listed in paragraph (b) are found in part 21, subpart E, of this chapter.

PART 20—DISTRIBUTION AND USE OF DENATURED ALCOHOL AND RUM 6. The authority citation for part 20 continues to read as follows: Authority:

26 U.S.C. 5001, 5206, 5214, 5271-5275, 5311, 5552, 5555, 5607, 6065, 7805.

7. Section 20.11 is amended by: a. Revising the definition of “Appropriate TTB officer”; b. Adding in alphabetical order definitions for “Fit for beverage use, or fit for beverage purposes” and “Internal human use”; c. Revising the definition of “Liter or litre”; d. Removing the definition of “Specially denatured spirits”; e. Adding in alphabetical order a definition for “Specially Denatured Spirits or S.D.S.” f. Adding in alphabetical order definitions for “TTB” and “Unfit for beverage use, or unfit for beverage purposes”; and g. Revising the Office of Management and Budget control number referenced at the end of the section.

The revisions and additions read as follows:

§ 20.11 Meaning of terms.

Appropriate TTB officer. An officer or employee of the Alcohol and Tobacco Tax and Trade Bureau (TTB) authorized to perform any functions relating to the administration or enforcement of this part by the current version of TTB Order 1135.20, Delegation of the Administrator's Authorities in 27 CFR part 20, Distribution and Use of Denatured Alcohol and Rum.

Fit for beverage use, or fit for beverage purposes. Suitable for consumption as an alcoholic beverage by a normal person, or susceptible of being made suitable for such consumption merely by dilution with water to an alcoholic strength of 15 percent by volume. The determination is based solely on the composition of the product and without regard to extraneous factors such as price, labeling, or advertising.

Internal human use. Use inside the human body, but not including use only in the mouth where the substance being used is not intended to be swallowed.

Liter or litre. A metric unit of capacity equal to 1,000 cubic centimeters of alcohol, and equivalent to 33.814 fluid ounces. A liter is divided into 1,000 milliliters. The symbol for milliliter or milliliters is “mL”.

Specially Denatured Spirits or S.D.S. Specially denatured alcohol and/or specially denatured rum.

TTB. The Alcohol and Tobacco Tax and Trade Bureau, U.S. Department of the Treasury.

Unfit for beverage use, or unfit for beverage purposes. Not conforming to the definition of “Fit for beverage use, or fit for beverage purposes” in this section.

(Approved by the Office of Management and Budget under control number 1513-0061)
§ 20.20 [Amended]
8. In § 20.20, the second sentence is amended by adding the words “the current version of” immediately before the words “TTB Order 1135.20”.
§§ 20.22, 20.56, 20.57, 20.60, 20.61, 20.62, 20.68, 20.142, 20.149, 20.170, 20.171, 20.172, 20.180, 20.192, 20.202, 20.203, 20.212, 20.216, 20.231, 20.232, 20.234, 20.235, 20.251, 20.252, 20.261, 20.262, 20.263, and 20.265 [Amended]
9. For each section indicated in the left-hand column of the table below, the parenthetical phrase at the end of each section is amended by removing the Office of Management and Budget control number indicated in the middle column, and adding, in its place, the number indicated in the right-hand column: Section Remove Add 20.22 1512-0336 1513-0061 20.56 1512-0336 1513-0061 20.57 1512-0336 1513-0061 20.60 1512-0336 1513-0061 20.61 1512-0336 1513-0061 20.62 1512-0336 1513-0061 20.68 1512-0336 1513-0061 20.142 1512-0337 1513-0062 20.149 1512-0337 1513-0062 20.170 1512-0337 1513-0062 20.171 1512-0337 1513-0062 20.172 1512-0337 1513-0062 20.180 1512-0337 1513-0062 20.192 1512-0337 1513-0062 20.202 1512-0336 1513-0061  “ 1512-0337 1513-0062 20.203 1512-0337 1513-0062 20.212 1512-0337 1513-0062 20.216 1512-0337 1513-0062 20.231 1512-0337 1513-0062 20.232 1512-0337 1513-0062 20.234 1512-0336 1513-0061 20.235 1512-0337 1513-0062 20.251 1512-0337 1513-0062 20.252 1512-0336 1513-0061 20.261 1512-0337 1513-0062 20.262 1512-0337 1513-0062 20.263 1512-0337 1513-0062 20.265 1512-0336 1513-0061 10. In § 20.41, paragraph (d)(1) is revised to read as follows:
§ 20.41 Application for industrial alcohol user permit.

(d) Exceptions. (1) The proprietor of a distilled spirits plant qualified under part 19 of this chapter is not required to qualify under this part for activities conducted at that plant's bonded premises.

§ 20.59 [Amended]
11. In § 20.59, paragraph (a) is amended by removing the word “teminated” and adding, in its place, the word “terminated”. 12. Section 20.63 is revised to read as follows:
§ 20.63 Adoption of formulas and statements of process.

(a) Adoption of formulas and statements of process is permitted:

(1) When a successor (proprietorship or fiduciary) adopts a predecessor's formulas and statements of process as provided in §§ 20.57(c) and 20.58; and

(2) When a permittee adopts for use at one plant, the formulas previously approved by TTB for use at another plant, or when a permittee adopts a formula previously approved by TTB for a parent or subsidiary, provided that in the case of a parent-subsidiary relationship the subsidiary is wholly-owned by the parent.

(b) The adoption will be accomplished by the submission of a certificate of adoption. The certificate of adoption shall be submitted to the appropriate TTB officer and shall contain:

(1) A list of all approved formulas or statements of process in which S.D.S. is used or recovered;

(2) The formulas of S.D.S. used or recovered;

(3) The dates of approval of the relevant Forms 1479-A or TTB Forms 5150.19:

(4) The applicable code number(s) for the article or process;

(5) The name of the permittee adopting the formulas, followed by the phrase, for each formula, “Formula of ___ (Name and permit number of permittee who received formula approval) is hereby adopted;” and

(6) In the case of a permittee adopting the formulas of another entity, evidence of its relationship to that entity.

(Approved by the Office of Management and Budget under control number 1513-0061)
§ 20.91 [Amended]
13. In § 20.91, paragraph (a) is amended by removing the words “in the TTB Bulletin” and adding, in their place, the words “on the TTB Web site at https://www.ttb.gov”. 14. In § 20.93, paragraph (a) is amended by removing the word “appoved” and adding, in its place, the word “approved”. 15. Section 20.95 is revised to read as follows:
§ 20.95 Developmental samples of articles.

(a) Samples for submission to TTB. Prior to receiving formula approval on TTB Form 5150.19, a user may use S.D.S. in the manufacture of samples of articles for submission in accordance with § 20.92. However, the user may only use the limited quantity of S.D.S. that is necessary to produce the samples.

(b) Samples for shipment to prospective customers. Prior to submitting a formula and statement of process on TTB Form 5150.19, a user may use S.D.S. to prepare developmental samples of articles for shipment to prospective customers. Only one sample of each formulation of the article under development may be sent to each customer. Each sample shall be no larger than necessary for the customer to determine whether the product meets its requirements. The user shall maintain records showing:

(1) The types of product samples prepared;

(2) The size of the samples sent, on a one-time basis, to each prospective customer; and

(3) The names and addresses of the prospective customers.

(c) Formula requirement. Before the user begins to make a quantity greater than specified in this section, formula approval on TTB Form 5150.19 is required.

(Approved by the Office of Management and Budget under control number 1513-0062)
§ 20.100 [Amended]
16. In § 20.100, paragraph (a) is amended by removing the word “addiition” and adding, in its place, the word “addition”. 17. Section 20.102 is revised to read as follows:
§ 20.102 Bay rum, alcoholado, or alcoholado-type toilet waters.

Unless manufactured exclusively for export under a formula approved by TTB and endorsed “For Export Only,” bay rum, alcoholado, or alcoholado-type toilet waters made with S.D.S. shall contain in each gallon of finished product:

(a) 71 milligrams of denatonium benzoate (also known as benzyldiethyl (2:6-xylylcarbamoyl methyl) ammonium benzoate) in addition to any of this material used as a denaturant in the specially denatured alcohol;

(b) 2 grams of tartar emetic; or

(c) 0.5 avoirdupois ounce of sucrose octaacetate.

§ 20.103 [Removed and Reserved]
18. Section 20.103 is removed and reserved. 19. Section 20.111 is amended by revising paragraph (a), adding a new paragraph (c), and revising the Office of Management and Budget control number referenced at the end of the section, to read as follows:
§ 20.111 General.

(a) Formula approval obtained on TTB Form 5150.19 is not required for an article made in accordance with any approved general-use formula that is specified in §§ 20.112 through 20.124, that is approved by the appropriate TTB officer as an alternate method, or that is published as a TTB Ruling on the TTB Web site at https://www.ttb.gov. However, a statement of process on TTB Form 5150.19 is still required in any of the circumstances described in § 20.94.

(c) The manufacturer shall ensure that each finished article made pursuant to a general-use formula is unfit for beverage use and is incapable of being reclaimed or diverted to beverage use or internal human use.

(Approved by the Office of Management and Budget under control number 1513-0061)
§ 20.112 [Amended]
20-21. Section 20.112 is amended by: a. In the last sentence of paragraph (a) introductory text, removing the word “alcohol” and adding, in its place, the letters “S.D.A.”; b. In paragraph (a)(1) by adding the words “propylene glycol monomethyl ether,” after the words “nitropropane (mixed isomers),”; and c. In paragraph (a)(2) is amended by removing the cross-reference to “§ 21.106” and adding, in its place, the cross-reference “§ 21.107”.; and d. Removing paragraph (c). 22. Section 20.113 is revised to read as follows:
§ 20.113 Proprietary solvents general-use formula.

A proprietary solvent made pursuant to this formula shall be made with alcohol denatured in accordance with S.D.A. Formula No. 1, 3-A, or 3-C and shall contain, for every 100 parts (by volume) of S.D.A.:

(a) No less than 1 part (by volume) of one or any combination of the following: Gasoline, unleaded gasoline, heptane, or rubber hydrocarbon solvent, and

(b) No less than 3 parts (by volume) of one or any combination of the following: Ethyl acetate (equivalent to 85 percent ester content, as defined in § 21.107 of this chapter), methyl isobutyl ketone, methyl n-butyl ketone, tert-butyl alcohol, sec-butyl alcohol, nitropropane (mixed isomers), ethylene glycol monoethyl ether, or toluene.

23. In § 20.114, the introductory text and paragraph (a) are revised to read as follows:
§ 20.114 Tobacco flavor general-use formula.

This tobacco flavor general-use formula authorizes the production of any finished article made with alcohol denatured in accordance with S.D.A. Formula No. 4 or S.D.R. Formula No. 4 which—

(a) Contains flavors sufficient to ensure that the article is unfit for beverage or internal human use,

24. In § 20.115, the introductory text and paragraph (a) are revised to read as follows:
§ 20.115 Ink general-use formula.

This ink general-use formula authorizes the production of any finished article made with alcohol denatured in accordance with S.D.A. Formula No. 1, 3-A, 3-C, 13-A, 23-A, 30, 32, 35-A, or 40-B, which—

(a) Contains pigments, dyes, or dyestuffs, which, alone or in combination with solvents or other ingredients, are sufficient to ensure that the article is unfit for beverage use,

25. Section 20.116 is revised to read as follows:
§ 20.116 Low alcohol general-use formula.

This low alcohol general-use formula authorizes the production of any finished article containing not more than 5 percent alcohol by weight or volume. Articles containing no alcohol, or whose manufacture involves the recovery of S.D.S., shall be covered by a statement of process on TTB Form 5150.19 submitted under § 20.94.

26. Section 20.117 is revised to read as follows:
§ 20.117 Reagent alcohol general-use formula.

(a) General. Reagent alcohol must be made in accordance with paragraph (b) of this section and labeled in accordance with paragraph (c) of this section. Reagent alcohol is—

(1) Treated as an article if distributed and used in accordance with paragraph (d) of this section; or

(2) Treated as S.D.A. if distributed and used in accordance with paragraph (e) of this section.

(b) Formula. Reagent alcohol shall be made with 95 parts (by volume) of S.D.A. 3-A, and 5 parts (by volume) of isopropyl alcohol. Water may be added at the time of manufacture. Reagent alcohol shall not contain any ingredient other than those specified in this paragraph.

(c) Labeling. Each container of reagent alcohol, regardless of size, shall have affixed to it a label containing the following words that are as conspicuous as any other words on the container labels: “Reagent Alcohol: Specially Denatured Alcohol Formula 3-A, 95 parts by vol.; and Isopropyl Alcohol, 5 parts by vol.” If water is added at the time of manufacture, the label shall specify the composition of the product as diluted.

(d) Distribution and use of reagent alcohol as an article. Reagent alcohol is treated as an article if distributed exclusively for the purpose of scientific use. Only the following distributions of reagent alcohol are permitted under this paragraph:

(1) For scientific use. (i) In smaller containers. The manufacturer or repackager of the reagent alcohol, or an S.D.S. dealer, may distribute reagent alcohol in containers not exceeding four liters to laboratories or other persons who require reagent alcohol for scientific use.

(ii) In bulk containers. The manufacturer of the reagent alcohol, or an S.D.S. dealer, may distribute reagent alcohol in containers larger than four liters to a laboratory or other person requiring reagent alcohol for scientific use if that laboratory or person is qualified to receive bulk shipments of reagent alcohol on October 31, 2016 or has received, from the appropriate TTB officer, approval of a letterhead application containing the following information:

(A) The applicant's name, address, and permit number, if any;

(B) An explanation of the applicant's need for bulk quantities of reagent alcohol;

(C) A description of the security measures that will be taken to segregate reagent alcohol from denatured spirits or other alcohol that may be on the same premises; and

(D) A statement that the applicant will allow any appropriate TTB officer to inspect the applicant's premises.

(2) For repackaging. The manufacturer of the reagent alcohol, or an S.D.S. dealer, may distribute reagent alcohol in containers larger than 4 liters to the persons specified in this paragraph. Those persons must repackage the reagent alcohol in containers not exceeding 4 liters, label the smaller packages in accordance with paragraph (c) of this section, and redistribute them in accordance with paragraph (d)(1)(i) of this section. The persons to whom reagent alcohol may be distributed in bulk for repackaging under this paragraph are:

(i) A proprietor of a bona fide laboratory supply house; and

(ii) Any other person who was qualified to receive bulk shipments of reagent alcohol on October 31, 2016, or who has received, from the appropriate TTB officer, approval of a letterhead application containing all of the information required by paragraph (d)(1)(ii)(A) through (D), in addition to the following:

(A) A statement that the applicant will comply with the labeling, packaging, and distribution requirements of paragraphs (c) and (d)(1) of this section; and

(B) A statement that the applicant will comply with the requirements of § 20.133.

(3) For redistribution. The manufacturer of the reagent alcohol, or an S.D.S. dealer, may distribute reagent alcohol in containers of any size to an S.D.S. dealer for redistribution in accordance with this section. An S.D.S. dealer distributing or redistributing reagent alcohol may repackage it in containers of any size permitted under this section that is necessary for the conduct of business.

(e) Distribution and use of reagent alcohol in manufacturing. Reagent alcohol is treated as S.D.A. if distributed for the purpose of manufacturing. The following requirements apply to reagent alcohol treated as S.D.A.:

(1) The manufacturer of the reagent alcohol, or an S.D.S. dealer, may distribute reagent alcohol in containers of any size to the persons specified in this paragraph for use in manufacturing.

(2) A person may receive reagent alcohol for use in manufacturing if the person:

(i) Holds a permit as an S.D.A. user;

(ii) Has received formula approval on TTB Form 5150.19 to use reagent alcohol in manufacturing; and

(iii) Treats the reagent alcohol as S.D.A., not an article.

(Approved by the Office of Management and Budget under control number 1513-0061)
§ 20.118 [Amended]
27. Section 20.118(b) is amended by: a. In Formula A, removing the word “ordorous” and adding, in its place, the word “odorous”; and b. In Formula B, removing the term “(Bitrex (THS-839))” and adding, in its place, the term “(denatonium benzoate)”.
§ 20.119 [Amended]
28. In § 20.119, the introductory text is amended by: a. Removing the words “shall consist of” and adding, in their place, the word “describes”; and b. Removing the word “formula” the second time it appears and adding, in its place, the word “formulation”. 29. In subpart F, add §§ 20.120 through 20.124 to read as follows: Subpart F—Formulas and Statements of Process Sec. 20.120 Multi-purpose general-use formula. 20.121 Vinegar general-use formula. 20.122 S.D.A. 39-C general-use formula. 20.123 Pressurized container general-use formula. 20.124 Duplicating fluid and ink solvent general-use formula.
§ 20.120 Multi-purpose general-use formula.

TTB authorizes this general-use formula for the manufacture of any article that:

(a) Is made with alcohol denatured in accordance with S.D.A. Formula No. 1, 3-A, 13-A, 19, 23-A, 23-H, 30, 32, 35-A, 36, 37, 38-D, 40, 40-A, and/or 40-B, but no other specially denatured spirits formula;

(b) Conforms to one of the Use Codes specified in part 21 of this chapter authorized for the S.D.A. formulation(s) being used to make the article, other than Use Code 900, as described in part 21 of this chapter; and

(c) Contains sufficient additional ingredients, other than the denaturants prescribed for the applicable S.D.A. formula(s) —

(1) To definitely change the composition and character of the S.D.A. used to make the article, and

(2) To ensure that the finished article is unfit for beverage or other internal human use, and, unless approved under § 20.193(b), is incapable of being reclaimed or diverted to beverage use or internal human use; and

(d) Does not conform to any other general-use formula provided in subpart F of this part.

§ 20.121 Vinegar general-use formula.

The vinegar general-use formula is a formula for making vinegar with alcohol denatured in accordance with S.D.A. Formula No. 18 in a process whereby all of the ethyl alcohol, except residual alcohol within the limit specified in § 20.104, loses its identity by being converted to vinegar.

§ 20.122 S.D.A. 39-C general-use formula.

S.D.A. 39-C general-use formula is a formula for articles made with alcohol denatured in accordance with S.D.A. Formula No. 39-C. Articles made pursuant to this general-use formula shall contain, in each gallon of finished product, not less than 2 fl. oz. of perfume material (essential oils as defined in § 21.11, isolates, aromatic chemicals, etc.). Unless approved with the endorsement “for export only,” all articles made with alcohol denatured in accordance with S.D.A. Formula No. 39-C must be made in accordance with this formula.

§ 20.123 Pressurized container general-use formula.

This general-use formula describes an article, made with alcohol denatured in accordance with S.D.A. Formula No. 40-C, that will be packaged in pressurized containers in which the liquid contents are in intimate contact with the propellant and from which the contents are not easily removable in liquid form.

§ 20.124 Duplicating fluid and ink solvent general-use formula.

(a) Duplicating fluids and ink solvents under this general-use formula shall be made with alcohol denatured in accordance with S.D.A. Formula No. 1, 3-A, 3-C, 13-A, 23-A, 30, 32, 35-A, or 40-B, and

(1) Shall contain, for every 100 parts (by volume) of denatured alcohol:

(i) No less than 1 part (by volume) of n-propyl acetate, and no less than 10 parts (by volume) of one or any combination of isopropyl alcohol or methyl alcohol; or

(ii) No less than 5 parts (by volume) of n-propyl acetate; and

(2) May contain additional ingredients.

(b) Duplicating fluids and ink solvents are intended for use in the printing industry, shall not be sold for general solvent use, and shall not be distributed through retail channels for sale as consumer commodities for personal or household use.

§ 20.131 [Amended]
30. In § 20.131, the second sentence is amended by adding the word “in” after the words “general terms”. 31. Section 20.132 is amended by adding a new paragraph (d) to read as follows:
§ 20.132 General requirements.

(d) Analytical tolerance. In the case of an article manufactured in accordance with a formula that specifies exact amounts of ingredients, including denatured spirits, TTB will apply an analytical tolerance of ±5% and use standard rounding rules in determining whether the article complies with the formula.

32. In § 20.133, paragraph (b) is revised, paragraph (c) is added, and the Office of Management and Budget control number referenced at the end of the section is revised to read as follows:
§ 20.133 Registration of persons trafficking in articles.

(b) A person who reprocesses articles shall ensure that each article containing 0.5 percent or more alcohol by weight or volume is unfit for beverage or internal human use and is incapable of being reclaimed or diverted to beverage use or internal human use.

(c) The appropriate TTB officer will prohibit any of the activities described in paragraph (a) of this section if the activity jeopardizes the revenue or increases the burden of administering this part.

(Approved by the Office of Management and Budget under control number 1513-0061)
33. In § 20.134, paragraph (a) and the Office of Management and Budget control number referenced at the end of the section are revised to read as follows:
§ 20.134 Labeling.

(a) General. Except as otherwise provided in paragraph (b) or (c) of this section, the immediate container of each article shall, before removal from the manufacturer's premises, bear the following information either directly on the container or on a label securely attached to it:

(1) The name, trade name or brand name of the article; and

(2) The name and address (city and State) of the manufacturer or distributor of the article.

(Approved by the Office of Management and Budget under control number 1513-0061)
34. Section 20.136 is revised to read as follows:
§ 20.136 Labeling regulations of other agencies.

Other Federal agencies have promulgated regulations that may affect the labeling of denatured spirits or articles. Manufacturers are responsible for properly labeling denatured spirits and articles in compliance with all applicable regulations of those other Federal agencies, which may include:

(a) The Consumer Product Safety Commission, which has promulgated regulations to administer the Federal Hazardous Substances Act, which include regulations in 16 CFR chapter II that require warning labels for products containing certain specified substances like methyl alcohol, which is a denaturant in formulations of S.D.A. Formula Nos. 3-A and 30, and is a hazardous substance at levels of 4 percent or more by weight;

(b) The Federal Trade Commission, which has promulgated regulations in 16 CFR chapter I to administer the Fair Packaging and Labeling Act, which affect the packaging and labeling of “consumer commodities” (which generally means products intended for retail sale to an individual for personal or household use);

(c) The Food and Drug Administration, which has promulgated regulations in 21 CFR chapter I to administer the Fair Packaging and Labeling Act (as it applies to drugs, medical devices, or cosmetics) and the Federal Food, Drug and Cosmetic Act; and

(d) The Occupational Safety and Health Administration, which administers the Occupational Safety and Health Act of 1970 and has promulgated regulations in 29 CFR chapter XVII concerning the communication of hazards.

§ 20.141 [Amended]
35. In § 20.141, paragraph (a) is amended by removing the word “formula” the first time it appears, and adding, in its place, the word “formulation”, and by adding the words “formulations of” after the words “For example,”.
§ 20.163 [Amended]
36. In § 20.163: a. Paragraph (d) is amended by removing the words “of bill or lading” and adding, in their place, the words “or bill of lading”; and b. The parenthetical phrase at the end of the section is amended by removing the Office of Management and Budget control number “1512-0337” and adding, in its place, the number “1513-0062”.
§ 20.170 [Amended]
37. Section 20.170 is amended by removing the word “formula” and adding, in its place, the word “formulation”.
§ 20.175 [Amended]
38. In § 20.175, paragraph (c) is amended by adding to the end of the sentence the words, “except as provided in 26 U.S.C. 5001(a)(4) and (5)”. 39. Section 20.183 is added under the undesignated center heading “Operations by Dealers” to read as follows:
§ 20.183 Exportation of S.D.S.

(a) General. Except as otherwise provided in paragraph (b) of this section, a dealer may export S.D.S. that conform to a formula specified in part 21 of this chapter to any country that allows the importation of such spirits. The exporting dealer shall:

(1) For each export shipment, prepare TTB Form 5100.11 in accordance with its instructions as a notice and submit it to the appropriate TTB officer;

(2) Mark each shipping container and case with the words “For Export”;

(3) Export the S.D.S. directly; and

(4) Retain appropriate documentation, such as invoices and bills of lading, as evidence that the denatured spirits were, in fact, exported.

(b) Exception. A dealer may not export under paragraph (a) of this section any spirits that conform to Formula No. 3-C, 29, or 38-B.

40. Section 20.189 is amended by revising paragraphs (c) and (d) to read as follows:
§ 20.189 Use of S.D.S.

(c) Unless otherwise authorized by the appropriate TTB officer, each formulation of S.D.S. may be used only for the purposes authorized for that formulation under part 21 of this chapter.

(d) By the use of essential oils and/or chemicals in the manufacture of each article containing 0.5 percent or more alcohol by weight or volume, the manufacturer shall ensure that:

(1) Each finished article is unfit for beverage use; and

(2) Unless approved “for export only” under § 20.193(b), each finished article is incapable of being reclaimed or diverted to beverage use or internal human use.

§ 20.191 [Amended]
41. Section 20.191 is amended by removing the last sentence. 42. Section 20.193 is added to subpart I to read as follows:
§ 20.193 Articles for export.

(a) Articles approved without qualification, including articles made in accordance with one of the general-use formulas in §§ 20.111 through 20.124, may be exported without restriction.

(b) For each article for which the approved formula is endorsed “For Export Only” the manufacturer shall:

(1) Label the immediate container to clearly show that the article is for export (for example, with the words “For export only”, “Not for sale in the United States”, or “Manufactured for sale in ___”);

(2) Mark the shipping containers and cases with the words “For Export”;

(3) Export the article directly; and

(4) Retain appropriate documentation, such as invoices and bills of lading, as evidence that the article was, in fact, exported.

(c) All articles for export shall comply with the applicable requirements of the countries to which they are sent.

43. In § 20.204, paragraph (c) is revised to read as follows:
§ 20.204 Incomplete shipments.

(c) Subject to the limitations for loss prescribed in § 20.202, the shipper (dealer or distilled spirits plant proprietor) shall file a claim for allowance of the entire quantity lost, in the manner provided in that section. The claim shall include the applicable data required by § 20.205.

44. Section 20.222 is revised to read as follows:
§ 20.222 Destruction.

(a) Record of destruction. A permittee who destroys specially denatured spirits or recovered alcohol, or who transfers such material to another entity for destruction, shall prepare a record of destruction, which shall be maintained by the permittee with the records required by subpart P of this part. The record shall identify—

(1) The reason for destruction,

(2) The date, time, location and manner of destruction,

(3) The quantity involved and, if applicable, identification of containers, and

(4) The name of the individual who accomplished or supervised the destruction.

(b) Destruction by nonpermittees. In general, the destruction of specially denatured spirits and recovered alcohol shall be performed by a permittee or a distilled spirits plant. However, a nonpermittee may destroy recovered alcoholic material if the material has been determined by the appropriate TTB officer to be equivalent to an article. If the material is not so determined, destruction may only occur on the premises of the manufacturer who recovered the material, a distilled spirits plant, or a dealer permittee.

(Approved by the Office of Management and Budget under control number 1513-0062)
§ 20.262 [Amended]
45. Section 20.262 is amended by removing the word “formula” each place it occurs and adding in its place the word “formulation”.
§ 20.263 [Amended]
46. Section 20.263 is amended by removing the word “formula” each place it occurs and adding in its place the word “formulation”. 47. In § 20.264, paragraphs (a)(1) and (2) are revised, paragraph (a)(4) is added, and the Office of Management and Budget control number referenced at the end of the section is revised to read as follows:
§ 20.264 User's records and report of products and processes.

(a) Records. (1) Each user shall maintain separate accountings of—

(i) The number of gallons of each formulation of new S.D.S. used for each product or process, recorded by the code number prescribed by § 21.141 of this chapter; and

(ii) The number of gallons of each formulation of recovered S.D.S. used for each product or process, recorded by the code number prescribed by § 21.141 of this chapter.

(2) Each user who recovers specially denatured spirits shall maintain separate accountings of the number of gallons of each formulation of specially denatured spirits recovered from each product or process, recorded by the code number prescribed by § 21.141 of this chapter.

(4) Each user who manufactures articles for export subject to § 20.193(b) shall retain the documentation required by § 20.193(b)(4).

(Approved by the Office of Management and Budget under control number 1513-0062)
PART 21—FORMULAS FOR DENATURED ALCOHOL AND RUM 48. The authority citation of part 21 continues to read as follows: Authority:

5 U.S.C. 552(a), 26 U.S.C. 5242, 7805.

49. Part 21 is amended by removing the abbreviation “ml” each place it occurs within the part and adding, in its place, the abbreviation “mL”.
§ 21.7 [Amended]
50. In § 21.7, the second sentence is amended by adding the words “the current version of” immediately before the words “TTB Order 1135.21”.
§ 21.11 [Amended]
51. In § 21.11: a. The definition of “Appropriate TTB Officer” is amended by adding the words “the current version of” immediately before the words “TTB Order 1135.21”; and b. The definition of “C.D.A.” is amended by removing the word “Completly” and adding, in its place, the word “Completely”. 52. In § 21.21 add paragraph (d) to read as follows:
§ 21.21 General.

(d) TTB will apply an analytical tolerance of ±5 percent and use standard rounding rules in determining whether completely denatured alcohol complies with the formula prescribed in this subpart (or in accordance with § 21.5).

53. In § 21.24, paragraph (a) is revised to read as follows:
§ 21.24 Formula No. 20.

(a) Formula. To every 100 gallons of ethyl alcohol of not less than 195 proof add:

A total of 2.0 gallons of either unleaded gasoline, rubber hydrocarbon solvent, kerosene, deodorized kerosene, alkylate, ethyl tertiary butyl ether, high octane denaturant blend, methyl tertiary butyl ether, naphtha, natural gasoline, raffinate, or any combination of these; or

A total of 5.0 gallons of toluene.

54. In subpart C, § 21.25 is added to read as follows:
§ 21.25 Formula No. 35.

Formula. To every 100 gallons of alcohol of not less than 185 proof add:

29.75 gallons of ethyl acetate having an ester content of 100 percent by weight or the equivalent thereof not to exceed 35 gallons of ethyl acetate with an ester content of not less than 85 percent by weight.

55. In subpart C, § 21.26 is added to read as follows:
§ 21.26 Formula No. 12-A.

Formula. To every 100 gallons of alcohol of not less than 185 proof add:

Five gallons of toluene or 5 gallons of heptane.

56. Section 21.31 is amended by adding paragraph (d) to read as follows:
§ 21.31 General.

(d) Analytical tolerance. TTB will apply an analytical tolerance of ±5% and use standard rounding rules in determining whether specially denatured spirits complies with the formula prescribed in this subpart (or in accordance with § 21.5).

57. In § 21.33, paragraph (a) is revised to read as follows:
§ 21.33 Formula No. 2-B.

(a) Formula. To every 100 gallons of alcohol add:

One-half gallon of rubber hydrocarbon solvent, 1/2 gallon of toluene, 1/2 gallon of heptane, 1/2 gallon of hexane (mixed isomers), or 1/2 gallon of n-hexane.

§ 21.34 [Removed and Reserved]
58. Section 21.34 is removed and reserved.
§ 21.35 [Amended]
59. In § 21.35, paragraph (a) is amended by adding the words “cyclohexane or” before the words “methyl alcohol.”
§ 21.36 [Removed and Reserved]
60. Section 21.36 is removed and reserved.
§§ 21.39 and 21.40 [Removed and Reserved]
61. Sections 21.39 and 21.40 are removed and reserved.
§ 21.41 [Amended]
62. In § 21.41, paragraph (b) is amended by adding the words “485. Miscellaneous solutions.” in appropriate numerical order.
§ 21.42 [Removed and Reserved]
63. Section 21.42 is removed and reserved.
§§ 21.45 and 21.46 [Removed and Reserved]
64. Sections 21.45 and 21.46 are removed and reserved.
§ 21.48 [Removed and Reserved]
65. Section 21.48 is removed and reserved.
§ 21.49 [Amended]
66. In § 21.49, paragraph (b)(1) is amended by removing the word “insectides” from the entry beginning “410” and adding, in its place, the word “insecticides”.
§§ 21.52 through 21.54 [Removed and Reserved]
67. Sections 21.52 through 21.54 are removed and reserved.
§ 21.59 [Amended]
68. In § 21.59, paragraph (b) is amended by adding the words “485. Miscellaneous solutions.” in appropriate numerical order.
§§ 21.60 and 21.61 [Removed and Reserved]
69. Sections 21.60 and 21.61 are removed and reserved.
§ 21.62 [Amended]
70. In § 21.62, paragraph (b)(1) is amended by adding the words “052. Inks.” and “485. Miscellaneous solutions.” in appropriate numerical order.
§ 21.63 [Amended]
71. In § 21.63, paragraph (a) is amended by adding the words “8.75 pounds of potassium hydroxide, on an anhydrous basis;” before the words “or 12.0 pounds of caustic soda,”.
§ 21.64 [Amended]
72. Section 21.64(a) is amended by removing the word “onces” and adding, in its place, the word “ounces”.
§ 21.65 [Amended]
73. In § 21.65, the list in paragraph (a) is amended by adding entries reading “Cornmint oil.”, “Distilled lime oil.”, “L(-)-Carvone.”, “Lemon oil.”, and “Peppermint oil, Terpeneless.”, in appropriate alphabetical order, and paragraph (b)(1) is amended by removing the word “Sterlizing” from the entry beginning “430” and adding, in its place, the word “Sterilizing”.
§ 21.66 [Removed and Reserved]
74. Section 21.66 is removed and reserved. 75. In § 21.68, paragraphs (a)(1) and (2) are revised to read as follows:
§ 21.68 Formula No. 38-F.

(a) * * *

(1) Six pounds of either boric acid, N.F., Polysorbate 80, N.F., or Poloxamer 407, N.F.; 11/3 pounds of thymol, N.F.; 11/3 pounds of chlorothymol, N.F. XII; and 11/3 pounds of menthol, U.S.P.; or

(2) A total of at least 3 pounds of any two or more denaturing materials listed under Formula No. 38-B, plus sufficient boric acid, N.F., Polysorbate 80, N.F., or Poloxamer 407, N.F. to total 10 pounds of denaturant; or

§§ 21.69 and 21.70 [Removed and Reserved]
76. Sections 21.69 and 21.70 are removed and reserved.
§ 21.76 [Amended]
77. In § 21.76, paragraph (b)(1) is amended by adding the words “052. Inks.” and “485. Miscellaneous solutions.” in appropriate numerical order.
§ 21.78 [Removed and Reserved]
78. Section 21.78 is removed and reserved.
§ 21.81 [Removed and Reserved]
79. Section 21.81 is removed and reserved.
§ 21.91 [Amended]
80. Section 21.91 is amended by adding a sentence at the end of the section to read as follows:
§ 21.91 General.

* * * The authorization of a substitute denaturant may be published in a TTB Ruling.

81. Section 21.94-T is added to read as follows:
§ 21.94-T Alkylate.

(a) API gravity at 60 °F. 70.4.

(b) Reid vapor pressure (PSI). 5.60 maximum.

(c) Distillation (°F):

(i) I.B.P. 109.0.

(ii) 10 percent. 186.6.

(iii) 50 percent. 221.1.

(iv) 90 percent. 271.8.

(v) End point distillation. 375.7.

§§ 21.97 and 21.98 [Removed and Reserved]
82. Sections 21.97 and 21.98 are removed and reserved.
§§ 21.103 and 21.104 [Removed and Reserved]
83. Sections 21.103 and 21.104 are removed and reserved. 84. Section 21.105-T1 is added to read as follows:
§ 21.105-T1 Cornmint oil (Mentha arvensis and Mentha canadensis).

(a) Specific gravity at 25 °C. 0.895 to 0.905.

(b) Refractive index at 20 °C. 1.4580 to 1.4590.

(c) Optical rotation at 20 °C. −18° to −36°.

(d) Alcohol content (as menthol). 65 percent minimum.

(e) Ketone content (as menthone). 5 percent minimum.

85. Section 21.105-T2 is added to read as follows:
§ 21.105-T2 Cyclohexane.

(a) Specific gravity at 20 °C. 0.75 to 0.80.

(b) Odor. Characteristic odor.

86. Section 21.106-T is added to read as follows:
§ 21.106-T Distilled lime oil (Citrus aurantifolia).

(a) Specific gravity at 25 °C. 0.850 to 0.870.

(b) Refractive index at 20 °C. 1.4740 to 1.4780.

(c) Optical rotation at 20 °C. +30° to +50°.

(d) Aldehyde content (as citral). 0.5 to 3.0 percent.

(e) Terpene content (as limonene). 45 percent minimum.

87. Section 21.108-T is added to read as follows:
§ 21.108-T Ethyl tertiary butyl ether.

(a) Purity. ≥95.0 percent.

(b) Color. Colorless to light yellow.

(c) Odor. Terpene-like.

(d) Specific gravity at 20 °C. 0.70 to 0.80.

(e) Boiling point (°C). 73.

§ 21.111 [Removed and Reserved]
88. Section 21.111 is removed and reserved. 89. Section 21.112-T1 is added to read as follows:
§ 21.112-T1 Hexane (mixed isomers).

(a) General. Minimum 55 percent n-hexane.

(b) Distillation range. No distillate should come over below 150 °F and none above 160 °F.

(c) Odor. Characteristic odor.

90. Section 21.112-T2 is added to read as follows:
§ 21.112-T2 n-Hexane.

(a) General. Minimum 97 percent purity.

(b) Distillation range. No distillate should come over below 150 °F and none above 160 °F.

(c) Odor. Characteristic odor.

91. Section 21.112-T3 is added to read as follows:
§ 21.112-T3 High octane denaturant blend.

(a) API Gravity at 60 °F. 40 to 65.

(b) Reid Vapor Pressure (PSI). 6 to 15.

(c) Isopropyl alcohol. 24 to 40 percent volume.

(d) Methyl alcohol. 1.6 to 9.6 percent volume.

(e) Diisopropyl ether (DIPE). 4 to 12 percent volume.

(f) tert-Butyl alcohol. 4 to 12 percent volume.

(g) Iso-pentane. 4 to 9 percent volume.

(h) Pentane. 4 to 9 percent volume.

(i) Pentene. 0 to 2.4 percent volume.

(j) Hexane. 2 to 6 percent volume.

(k) Heptane. 1 to 3 percent volume.

(l) Sulfur (ppm). 0 to 120.

(m) Benzene (% vol.). 0 to 1.1.

(n) Distillation (°F):

(i) 10 percent. 80 to 168.

(ii) 50 percent. 250.

(iii) End point distillation. 437.

92. Section 21.115-T1 is added to read as follows:
§ 21.115-T1 Lemon oil (Citrus limonium).

(a) Specific gravity at 25 °C. 0.850 to 0.860.

(b) Refractive index at 20 °C. 1.4570 to 1.4580.

(c) Optical rotation at 20 °C. +55° to +65°.

(d) Terpene content (as limonene). 65 percent minimum.

93. Section 21.115-T2 is added to read as follows:
§ 21.115-T2 L(-)-Carvone.

(a) Specific gravity at 25 °C. 0.955 to 0.965.

(b) Refractive index at 20 °C. 1.495 to 1.500.

(c) Angular rotation. -57° to -62°.

(d) Assay. Not less than 97.0 percent.

94. Section 21.118-T1 is added to read as follows:
§ 21.118-T1 Methyl tertiary butyl ether.

(a) Purity. ≥ 97.0 percent.

(b) Color. Clear, colorless.

(c) Odor. Turpentine-like.

(d) Specific Gravity at 20 °C. 0.70 to 0.80.

(e) Boiling Point (°C). 55.

95. Section 21.118-T2 is added to read as follows:
§ 21.118-T2 Naphtha.

(a) API Gravity at 60 °F. 30 to 85.

(b) Reid Vapor Pressure (PSI). 8 maximum.

(c) Specific Gravity at 20 °C. 0.70 to 0.80.

(d) Distillation (°F):

(i) I.B.P. 85 maximum.

(ii) 10 percent. 130 maximum.

(iii) 50 percent. 250 maximum.

(iv) 90 percent. 340 maximum.

(e) End point distillation. 380 maximum.

(f) Copper corrosion. One (1).

(g) Sabolt color. 28 minimum.

96. Section 21.118-T3 is added to read as follows:
§ 21.118-T3 Natural gasoline.

Natural gasoline is a mixture of various alkanes including butane, pentane, and hexane hydrocarbons extracted from natural gas. It has a distillation range wherein no more than 10 percent by volume of the sample may distill below 97 °F; at least 50 percent by volume shall distill at or below 156 °F; and at least 90 percent by volume shall distill at or below 209 °F.

97. Section 21.121 is revised to read as follows:
§ 21.121 Peppermint oil, Terpeneless.

(a) Specific gravity at 25 °C. 0.890 to 0.910.

(b) Refractive index at 20 °C. 1.455 to 1.465.

(c) Esters as menthyl acetate. 5 percent minimum.

(d) Menthol (free and esters). 5 percent minimum.

98. Section 21.122 is revised to read as follows:
§ 21.122 Potassium Hydroxide.

(a) Color. White or yellow.

(b) Specific gravity at 20 °C. 1.95 to 2.10.

(c) Melting point. 360 °C.

(d) Boiling point. 1320 °C.

(e) pH (0.1M solution). 13.5.

99. Section 21.124-T is added to read as follows:
§ 21.124-T Raffinate.

(a) API Gravity at 60 °F. 30 to 85.

(b) Reid Vapor Pressure (PSI). 5 to 11.

(c) Octane (R+M/2). 66 to 70.

(d) Distillation (°F):

(i) 10 percent. 120 to 150.

(ii) 50 percent. 144 to 180.

(iii) 90 percent. 168 to 200.

(iv) End point distillation. 216 to 285.

§ 21.125 [Amended]
100. In § 21.125, the first sentence of paragraph (b) is amended by removing the word “themometer” and adding, in its place, the word “thermometer”.
§ 21.128 [Removed and Reserved]
101. Section 21.128 is removed and reserved. 102. Section 21.130-T is added to read as follows:
§ 21.130-T Straight run gasoline.

(a) General. Straight run gasoline is a mixture consisting predominantly (greater than 60 percent by volume) of C4, C5, C6, C7 and/or C8 hydrocarbons, and is either:

(1) A petroleum distillate coming straight from an atmospheric distillation unit without being cracked or reformed, or

(2) A condensate coming directly from an oil/gas recovery operation.

(b) API gravity. 72° minimum, 85° maximum.

(c) Reid vapor pressure (PSI). 15 maximum.

(d) Sulfur. 120 ppm maximum.

(e) Benzene. 1.1 percent by volume maximum.

(f) Distillation (°F):

(1) 10 percent. 97 minimum, 158 maximum.

(2) 50 percent. 250 maximum.

(3) Final boiling point. 437 maximum.

103. Section 21.132 is revised to read as follows:
§ 21.132 Toluene.

(a) Specific Gravity at 15.56°/15.56 °C. 0.80 to 0.90.

(b) Boiling point (°C). 110.6.

(c) Distillation range (°C). Not more than 1 percent by volume should distill below 109, and not less than 99 percent by volume below 112.

(d) Odor. Characteristic odor.

104. In § 21.141, the table is amended by: a. Removing the entry for “Antiseptic, bathing solution (restricted)”; b. Removing each reference to “2-C”, “3-B”, “6-B”, “12- A”, “17”, “20”, “22”, “23-F”, “27”, “27-A”, “27-B”, “33”, “35”, “38-C”, “39”, “39-A”, “42”, and “46” in the column headed “Formulas authorized”; and c. Revising the entries for “Inks” and for “Solutions, miscellaneous”.

The revisions read as follows:

§ 21.141 List of products and processes using specially denatured alcohol and rum, and formulas authorized therefor. Product or process Code No. Formulas authorized *         *         *         *         *         *         * Inks 052 1, 3-A, 3-C, 13-A, 23-A, 30, 32, 33, 35-A, 40-B. *         *         *         *         *         *         * Solutions, miscellaneous 485 1, 3-A, 3-C, 13-A, 23-A, 30, 32, 35-A, 40-B, 40-C. *         *         *         *         *         *         *
§ 21.151 [Amended]
105. In § 21.151, the table is amended by: a. Removing the entries for “Benzene”; “Bone oil (Dipple's oil)”; “Chloroform”; “Cinchonidine”; “Cinchonidine sulfate, N.F. IX”; “Gentian violet”; “Gentian violet, U.S.P”; “Mercuric iodide, red N.F. XI”; “Phenyl mercuric benzoate”; “Phenyl mercuric chloride, N.F. IX”; “Phenyl mercuric nitrate, N.F”; “Pine tar, U.S.P”; “Pyridine bases”; “Quassia, fluid extract, N.F. VII”; “Quinine, N.F. X”; “Quinine dihydrochloride, N.F. XI”; “Resorcinol (Resorcin), U.S.P”; “Salicylic acid, U.S.P”; “Sodium, metallic”; and “Thimerosal, U.S.P”; b. Removing each remaining reference to “2-C”, “22”, “23-F”, “27”, “27-A”, “27-B”, “38-C”, “39”, “39-A”, “42”, and “46”; and c. Revising the entries for “Ethyl acetate”, and “Toluene”; and d. Adding entries for “Alkylate”, “Cornmint oil”, “Cyclohexane”, “Distilled lime oil”, “Ethyl tertiary butyl ether”, “Hexane”, “n-Hexane”, “High octane denaturant blend”, “L(-)-Carvone”, “Lemon oil”, “Methyl tertiary butyl ether”, “Naphtha”, “Natural gasoline”, “Peppermint oil, terpeneless.”, “Poloxamer 407 N.F.”, “Potassium hydroxide”, “Raffinate”, and “Straight run gasoline”.

The revisions and additions read as follows:

§ 21.151 List of denaturants authorized for denatured spirits. Alkylate C.D.A. 20. Cornmint oil S.D.A. 38-B. Cyclohexane S.D.A. 3-A. Distilled lime oil S.D.A. 38-B. Ethyl acetate C.D.A. 35; S.D.A. 29, 35-A. Ethyl tertiary butyl ether C.D.A. 20. Hexane S.D.A. 2-B. n-Hexane S.D.A. 2-B. High octane denaturant blend C.D.A. 20. L(-)-Carvone S.D.A. 38-B. Lemon oil S.D.A. 38-B. Methyl tertiary butyl ether C.D.A. 20. Naphtha C.D.A. 20. Natural gasoline C.D.A. 20. Peppermint oil, terpeneless S.D.A. 38-B. Poloxamer 407, N.F. S.D.A. 38-F. Potassium hydroxide S.D.A. 36. Raffinate C.D.A. 20. Straight run gasoline C.D.A. 20. Toluene C.D.A. 12-A; S.D.A. 2-B.
§ 21.161 [Amended]
106. In § 21.161, the table is revised by removing the entries for “2-C”, “3-B”, “6-B”, “12-A”, “17”, “20”, “22”, “23-F”, “27”, “27-A”, “27-B”, “33”, “35 3”, “35 4”, “38-C”, “39”, “39-A”, “42”, and “46”. PART 27—IMPORTATION OF DISTILLED SPIRITS, WINES, AND BEER 107. The authority citation for part 27 is revised to read as follows: Authority:

5 U.S.C. 552(a), 19 U.S.C. 81c, 1202; 26 U.S.C. 5001, 5007, 5008, 5010, 5041, 5051, 5054, 5061, 5121-5124, 5201, 5205, 5207, 5232, 5273, 5301, 5313, 5555, 6302, 7805.

108. Section 27.222 is added to read as follows:
§ 27.222 Importation of denatured spirits and fuel alcohol.

Denatured spirits and fuel alcohol are treated as spirits for purposes of this part and are subject to tax pursuant to § 27.40(a). The tax must be paid upon importation, with only two exceptions: Spirits may be withdrawn from customs custody free of tax for the use of the United States under subpart M of this part; and spirits may be withdrawn from customs custody and transferred to a distilled spirits plant, including a bonded alcohol fuel plant, without payment of tax under subpart L of this part. After transfer pursuant to subpart L, denatured spirits or fuel alcohol may be withdrawn free of tax in accordance with part 19 of this chapter if they meet the standards to conform either to a denatured spirits formula specified in part 21 of this chapter (for withdrawal from a regular distilled spirits plant) or a formula specified in § 19.746 of this chapter (for withdrawal from an alcohol fuel plant). Such withdrawal is permitted, even though the denaturation or rendering unfit for beverage use may have occurred, in whole or in part, in a foreign country. For purposes of this chapter, the denaturation or rendering unfit is deemed to have occurred at the distilled spirits plant (including the alcohol fuel plant), the proprietor of which is responsible for compliance with part 21 or § 19.746, as the case may be. Imported fuel alcohol shall also conform to the requirements of 27 CFR 19.742.

PART 28—EXPORTATION OF LIQUORS 109. The authority citation for part 28 continues to read as follows: Authority:

5 U.S.C. 552(a); 19 U.S.C. 81c, 1202; 26 U.S.C. 5001, 5007, 5008, 5041, 5051, 5054, 5061, 5121, 5122, 5201, 5205, 5207, 5232, 5273, 5301, 5313, 5555, 6302, 7805; 27 U.S.C. 203, 205, 44 U.S.C. 3504(h).

110. Section 28.157 is added to read as follows:
§ 28.157 Exportation by dealer in specially denatured spirits.

A dealer in specially denatured spirits who holds a permit under part 20 of this chapter may export specially denatured spirits in accordance with § 20.183 of this chapter.

Signed: July 6, 2016. John J. Manfreda, Administrator. Approved: July 7, 2016. Timothy E. Skud, Deputy Assistant Secretary (Tax, Trade, and Tariff Policy).
[FR Doc. 2016-20712 Filed 8-29-16; 8:45 am] BILLING CODE 4810-31-P
DEPARTMENT OF LABOR Employee Benefits Security Administration 29 CFR Part 2510 RIN 1210-AB71 Savings Arrangements Established by States for Non-Governmental Employees AGENCY:

Employee Benefits Security Administration, Department of Labor.

ACTION:

Final rule.

SUMMARY:

This document describes circumstances in which state payroll deduction savings programs with automatic enrollment would not give rise to the establishment of employee pension benefit plans under the Employee Retirement Income Security Act of 1974, as amended (ERISA). This document provides guidance for states in designing such programs so as to reduce the risk of ERISA preemption of the relevant state laws. This document also provides guidance to private-sector employers that may be covered by such state laws. This rule affects individuals and employers subject to such state laws.

DATES:

This rule is effective October 31, 2016.

FOR FURTHER INFORMATION CONTACT:

Janet Song, Office of Regulations and Interpretations, Employee Benefits Security Administration, (202) 693-8500. This is not a toll-free number.

SUPPLEMENTARY INFORMATION:

I. Background

Approximately 39 million employees in the United States do not have access to a retirement savings plan through their employers.1 Even though such employees could set up and contribute to their own individual retirement accounts or annuities (IRAs), the great majority do not save for retirement. In fact, less than 10 percent of all workers contribute to a plan outside of work.2

1 National Compensation Survey, Bureau of Labor Statistics (July 2016), Employee Benefits in the United States—March 2016 (http://www.bls.gov/news.release/pdf/ebs2.pdf). These data show that 66 percent of 114 million private-sector workers have access to a retirement plan through work. Therefore, 34 percent of 114 million private-sector workers (39 million) do not have access to a retirement plan through work.

2See The Pew Charitable Trust, “How States Are Working to Address The Retirement Savings Challenge,” (June 2016) (http://www.pewtrusts.org/~/media/assets/2016/06/howstatesareworkingtoaddresstheretirementsavingschallenge.pdf).

For older Americans, inadequate retirement savings can mean sacrificing or skimping on food, housing, health care, transportation, and other necessities. In addition, inadequate retirement savings places greater stress on state and federal social welfare programs as guaranteed sources of income and economic security for older Americans. Accordingly, states have a substantial governmental interest to encourage retirement savings in order to protect the economic security of their residents.3 Concern over the low rate of saving among American workers and the lack of access to workplace plans for many of those workers has led some state governments to expand access to savings programs for their residents and other individuals employed in their jurisdictions by creating their own programs and requiring employer participation.4

3See Christian E. Weller, Ph.D., Nari Rhee, Ph.D., and Carolyn Arcand, “Financial Security Scorecard: A State-by-State Analysis of Economic Pressures Facing Future Retirees,” National Institute on Retirement Security (March 2014) (www.nirsonline.org/index.php?option=com_content&task=view&id=830&Itemid=48).

4See, e.g., Kathleen Kennedy Townsend, Chair, Report of the Governor's Task Force to Ensure Retirement Security for All Marylanders, “1,000,000 of Our Neighbors at Risk: Improving Retirement Security for Marylanders” (2015).

A. State Payroll Deduction Savings Initiatives

One approach some states have taken is to establish state payroll deduction savings programs. Through automatic enrollment such programs encourage employees to establish tax-favored IRAs funded by payroll deductions.5 California, Connecticut, Illinois, Maryland, and Oregon, for example, have adopted laws along these lines.6 These initiatives generally require certain employers that do not offer workplace savings arrangements to automatically deduct a specified amount of wages from their employees' paychecks unless the employee affirmatively chooses not to participate in the program.7 The employers are also required to remit the payroll deductions to state-administered IRAs established for the employees. These programs also allow employees to stop the payroll deductions at any time. The programs, as currently designed, do not require, provide for or permit employers to make matching or other contributions of their own into the employees' accounts. In addition, the state initiatives typically require that employers provide employees with information prepared or assembled by the program, including information on employees' rights and various program features.

5 These could include individual retirement accounts described in 26 U.S.C. 408(a), individual retirement annuities described in 26 U.S.C. 408(b), and Roth IRAs described in 26 U.S.C. 408A.

6 California Secure Choice Retirement Savings Trust Act, Cal. Gov't Code §§ 100000-100044 (2012); Connecticut Retirement Security Program Act, P.A. 16-29 (2016); Illinois Secure Choice Savings Program Act, 820 Ill. Comp. Stat. 80/1-95 (2015); Maryland Small Business Retirement Savings Program Act, Ch. 324 (H.B. 1378)(2016); Oregon Retirement Savings Board Act, Ch. 557 (H.B. 2960)(2015).

7 Workplace savings arrangements may include plans such as those qualified under or described in 26 U.S.C. 401(a), 401(k), 403(a), 403(b), 408(k) or 408(p), and may constitute either ERISA or non-ERISA arrangements.

B. ERISA's Regulation of Employee Benefit Plans

Section 3(2) of ERISA defines the terms “employee pension benefit plan” and “pension plan” broadly to mean, in relevant part “[A]ny plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that by its express terms or as a result of surrounding circumstances such plan, fund, or program provides retirement income to employees. . . .” 8 The Department and the courts have broadly interpreted “established or maintained” to require only minimal involvement by an employer or employee organization.9 An employer could, for example, establish an employee benefit plan simply by purchasing insurance products for individual employees. These expansive definitions are essential to ERISA's purpose of protecting plan participants by ensuring the security of promised benefits.

8 29 U.S.C. 1002(2)(A). ERISA's Title I provisions “shall apply to any employee benefit plan if it is established or maintained . . . by any employer engaged in commerce or in any industry or activity affecting commerce.” 29 U.S.C. 1003(a). Section 4(b) of ERISA includes express exemption from coverage under Title I for governmental plans, church plans, plans maintained solely to comply with applicable state laws regarding workers compensation, unemployment, or disability, certain foreign plans, and unfunded excess benefit plans. 29 U.S.C. 1003(b).

9Donovan v. Dillingham, 688 F.2d 1367 (11th Cir. 1982); Harding v. Provident Life and Accident Ins. Co., 809 F. Supp. 2d 403, 415-419 (W.D. Pa. 2011); DOL Adv. Op. 94-22A (July 1, 1994).

Due to the broad scope of ERISA coverage, some stakeholders have expressed concern that state payroll deduction savings programs, such as those enacted in California, Connecticut, Illinois, Maryland, and Oregon may cause covered employers to inadvertently establish ERISA-covered plans, despite the express intent of the states to avoid such a result. This uncertainty, together with ERISA's broad preemption of state laws that “relate to” private-sector employee pension benefit plans has created a serious impediment to wider adoption of state payroll deduction savings programs.10

10 ERISA's preemption provision, section 514(a) of ERISA, 29 U.S.C. 1144(a), provides that the Act “shall supersede any and all State laws insofar as they . . . relate to any employee benefit plan” covered by the statute. The U.S. Supreme Court has long held that “[a] law `relates to' an employee benefit plan, in the normal sense of the phrase, if it has a connection with or reference to such a plan.” Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97 (1983) (footnote omitted). In various decisions, the Court has concluded that ERISA preempts state laws that: (1) mandate employee benefit structures or their administration; (2) provide alternative enforcement mechanisms; or (3) bind employers or plan fiduciaries to particular choices or preclude uniform administrative practice, thereby functioning as a regulation of an ERISA plan itself.

C. 1975 IRA Payroll Deduction Safe Harbor

Although IRAs generally are not set up by employers or employee organizations, ERISA coverage may be triggered if an employer (or employee organization) does, in fact, “establish or maintain” an IRA arrangement for its employees. 29 U.S.C. 1002(2)(A).11 In contexts not involving state payroll deduction savings programs, the Department has previously issued guidance to help employers determine whether their involvement in certain voluntary payroll deduction savings arrangements involving IRAs would result in the employers having established or maintained ERISA-covered plans. That guidance included a 1975 “safe harbor” regulation under 29 CFR 2510.3-2(d) setting forth circumstances under which IRAs funded by payroll deductions would not be treated as ERISA plans, and a 1999 Interpretive Bulletin clarifying that certain ministerial activities will not cause an employer to have established an ERISA plan simply by facilitating such payroll deduction savings arrangements.12

11 ERISA section 404(c)(2) (simple retirement accounts); 29 CFR 2510.3-2(d) (1975 IRA payroll deduction safe harbor); 29 CFR 2509.99-1 (interpretive bulletin on payroll deduction IRAs); Cline v. The Industrial Maintenance Engineering & Contracting Co., 200 F.3d 1223, 1230-31 (9th Cir. 2000).

12See 29 CFR 2510.3-2(d); 40 FR 34526 (Aug. 15, 1975); 29 CFR 2509.99-1. The Department has also issued advisory opinions discussing the application of the safe harbor regulation to particular facts. See, e.g., DOL Adv. Op. 82-67A (Dec. 21, 1982); DOL Adv. Op. 84-25A (June 18, 1984).

The 1975 regulation provides that certain IRA payroll deduction arrangements are not subject to ERISA if four conditions are met: (1) The employer makes no contributions; (2) employee participation is “completely voluntary”; (3) the employer does not endorse the program and acts as a mere facilitator of a relationship between the IRA vendor and employees; and (4) the employer receives no consideration except for its own expenses.13 In essence, if the employer merely allows a vendor to provide employees with information about an IRA product and then facilitates payroll deduction for employees who voluntarily initiate action to sign up for the vendor's IRA, the employer will not have established, and the arrangement will not be, an ERISA pension plan.

13 29 CFR 2510.3-2(d) (1975 IRA Payroll Deduction Safe Harbor).

With regard to the 1975 IRA Payroll Deduction Safe Harbor's condition requiring that an employee's participation be “completely voluntary,” the Department intended this term to mean that the employee's enrollment in the program must be self-initiated. In other words, under the safe harbor, the decision to enroll in the program must be made by the employee, not the employer. If the employer automatically enrolls employees in a benefit program, the employees' participation would not be “completely voluntary” and the employer's actions would constitute the “establishment” of a pension plan, within the meaning of ERISA section 3(2). This is true even if the employee can affirmatively opt out of the program.14 Thus, arrangements that allow employers to automatically enroll employees—as do all existing state payroll deduction savings programs—do not satisfy the condition in the safe harbor that the employees' participation be “completely voluntary,” even if the employees are permitted to “opt out” of the program. Consequently, such programs would fall outside the 1975 safe harbor and could be subject to ERISA.

14See generally Proposed rule on Savings Arrangements Established by States for Non-Governmental Employees, 80 FR 72006, 72008 (November 18, 2015) (The completely voluntary condition in the 1975 safe harbor is “important because where the employer is acting on his or her own volition to provide the benefit program, the employer's actions—e.g., requiring an automatic enrollment arrangement—would constitute its `establishment' of a plan within the meaning of ERISA's text, and trigger ERISA's protections for the employees whose money is deposited into an IRA.”).

D. 2015 Proposed Regulation

At the 2015 White House Conference on Aging, the President directed the Department to publish guidance to support state efforts to promote broader access to workplace retirement savings opportunities for employees. On November 18, 2015, the Department published in the Federal Register a proposed regulation providing that for purposes of Title I of ERISA the terms “employee pension benefit plan” and “pension plan” do not include an IRA established and maintained pursuant to a state payroll deduction savings program if that program satisfies all of the conditions set forth in the proposed rule.15 By articulating the types of state payroll deduction savings programs that would be exempt from ERISA, the proposal sought to create a safe harbor for the states and employers and thus remove uncertainty regarding Title I coverage of such state payroll deduction savings programs and the IRAs established and maintained pursuant to them. In the Department's view, courts would be less likely to find that statutes creating state programs in compliance with the proposed safe harbor are preempted by ERISA.

15 80 FR 72006 (November 18, 2015). On the same day that the NPRM was published, the Department also published an interpretive bulletin (IB) explaining the Department's views concerning the application of ERISA to certain state laws designed to expand retirement savings options for private-sector workers through ERISA-covered retirement plans. 80 FR 71936 (codified at 29 CFR 2509.2015-02). A number of commenters on the NPRM discussed ERISA preemption and other issues that the commenters perceived as raised by the analysis and conclusions in the IB. Comments on the IB are beyond the scope of this regulation and are not discussed in this document.

The proposal parallels the 1975 IRA Payroll Deduction Safe Harbor in that it requires the employer's involvement to be no more than ministerial. 29 CFR 2510.3-2(d).16 In both contexts, limited employer involvement in the arrangement is the key to finding that the employer has not established or maintained an employee pension benefit plan. The proposal added the conditions that employer involvement must be required under state law, and that the state must establish and administer the program pursuant to state law. Significantly, and in recognition of the fact that several state initiatives provide for automatic enrollment and therefore would not satisfy the Department's 1975 IRA Payroll Deduction Safe Harbor condition that employee participation in such programs be “completely voluntary,” the proposal also adopted a new condition that employee participation be “voluntary.” Because the new safe harbor requires that the employer's involvement in the program be required and circumscribed by state law, the 1975 safe harbor's condition that employee participation be “completely voluntary” has been modified to permit state-required automatic employee enrollment procedures.

16 The Department has issued similar safe harbor regulations for group and group-type insurance arrangements, 29 CFR 2510.3-1(j) and for tax sheltered annuities, 29 CFR 2510.3-2(f).

The Department received and analyzed approximately 70 public comments in response to the proposed rule. The Department is issuing a final rule that contains some changes and clarifications in response to questions raised in the public comments. Those changes are described herein.

II. Overview of Final Rule

The final rule largely adopts the proposal's general structure. Thus, new paragraph (h) of § 2510.3-2 continues to provide in the final rule that, for purposes of Title I of ERISA, the terms “employee pension benefit plan” and “pension plan” do not include an individual retirement plan (as defined in 26 U.S.C. 7701(a)(37)) 17 established and maintained pursuant to a state payroll deduction savings program if the program satisfies all of the conditions set forth in paragraphs (h)(1)(i) through (xi) of the regulation. Thus, if these conditions are satisfied, neither the state nor the employer is establishing or maintaining a pension plan subject to Title I of ERISA.

17 The term “individual retirement plan” includes both traditional IRAs (individual retirement accounts described in section 408(a) and individual retirement annuities described in section 408(b) of the Code) and Roth IRAs under section 408A of the Code.

Most of the new safe harbor's conditions focus on the state's role in the program. The program must be specifically established pursuant to state law. 29 CFR 2510.3-2(h)(1)(i). The program is implemented and administered by the state that established the program. 29 CFR 2510.3-2(h)(1)(ii). The state must be responsible for investing the employee savings or for selecting investment alternatives from which employees may choose. Id. The state must be responsible for the security of payroll deductions and employee savings. 29 CFR 2510.3-2(h)(1)(iii). The state must adopt measures to ensure that employees are notified of their rights under the program, and must create a mechanism for enforcing those rights. 29 CFR 2510.3-2(h)(1)(iv). The state may implement and administer the program through its governmental agency or instrumentality. 29 CFR 2510.3-2(h)(1)(ii). The state or its governmental agency or instrumentality may also contract with others to operate and administer the program. 29 CFR 2510.3-2(h)(2)(ii).

Many of the rule's conditions limit the employer's role in the program. The employer's activities must be limited to ministerial activities such as collecting payroll deductions and remitting them to the program. 29 CFR 2510.3-2(h)(1)(vii)(A). The employer may provide notice to the employees and maintain records of the payroll deductions and remittance of payments. 29 CFR 2510.3-2(h)(1)(vii)(B). The employer may provide information to the state necessary for the operation of the program. 29 CFR 2510.3-2(h)(1)(vii)(C). The employer may distribute program information from the state program to employees. 29 CFR 2510.3-2(h)(1)(vii)(D). Employers cannot contribute employer funds to the IRAs. 29 CFR 2510.3-2(h)(1)(viii). Employer participation in the program must be required by state law. 29 CFR 2510.3-2(h)(1)(ix).

Other critical conditions focus on employee rights. For example, employee participation in the program must be voluntary. 29 CFR 2510.3-2(h)(1)(v). Thus, if the program requires automatic enrollment, employees must be given adequate advance notice and have the right to opt out. 29 CFR 2510.3-2(h)(2)(iii). In addition, employees must be notified of their rights under the program, including the mechanism for enforcement of those rights. 29 CFR 2510.3-2(h)(1)(iv).

III. Changes to Proposal Based on Public Comment A. Ability To Experiment

The final rule contains new regulatory text in paragraph (a) of § 2510.3-2 making it clear that the rule's conditions on state payroll deduction savings programs simply create a safe harbor. A safe harbor approach to these arrangements provides to states clear guide posts and certainty, yet does not by its terms prohibit states from taking additional or different action or from experimenting with other programs or arrangements. Although the Department expressed this view in the proposal's preamble, commenters requested that this safe harbor position be explicitly incorporated into the operative text, just as the Department did previously under § 2510.3-1 with respect to certain practices excluded from the definition of “welfare plan.” 18 The Department agrees that the final regulation would be improved by adding regulatory text explicitly recognizing that the regulation is a safe harbor. Adding such regulatory text clarifies the Department's intent and conforms this section with § 2510.3-1 (relating to welfare plans).

18See Comment Letter # 58 (Joint Submission from Service Employee International Union, National Education Association, American Federation of Teachers, American Federation of State County and Municipal Employees, and National Conference on Public Employee Retirement Systems) (“Although the preamble to the Proposed Rule clearly states that it is providing an additional `safe harbor' that defined an arrangement that is not subject to ERISA coverage, that statement does not appear within the body of the regulation itself. It would be helpful to those states that may wish to experiment by adopting programs that are not specifically and clearly covered by the safe harbor but that are consistent with its meaning and intent if the [final rule] were to include such a statement.”).

Accordingly, the final rule revises paragraph (a) of § 2510.3-2 by deleting some outdated text and adding the following sentence: “The safe harbors in this section should not be read as implicitly indicating the Department's views on the possible scope of section 3(2).” By adding this sentence to paragraph (a) of § 2510.3-2, the sentence then modifies all plans, funds and programs subsequently listed and discussed in paragraphs (b) through (h) of § 2510.3-2.19 In different contexts in the past, the Department has stated its view that various of the programs listed in paragraphs (b) through (g) of § 2510.3-2 are safe harbors and do not preclude the possibility that plans, funds, and programs not meeting the relevant conditions in the regulation might also not be pension plans within the meaning of ERISA. Thus, this revision to paragraph (a) merely clarifies this view in operative text for these other programs.

19 The plans, funds, and programs described in 29 CFR 2510.3-2 are severance pay plans (see paragraph (b)), bonus programs (see paragraph (c)), 1975 IRA payroll deduction (see paragraph (d)), gratuitous payments to pre-ERISA retirees (see paragraph (e)), tax sheltered annuities (see paragraph (f)), supplemental payment plans (see paragraph (g)) and certain state savings programs (see new paragraph (h)).

B. Ability To Choose Investments and Control Leakage

The final rule removes the condition from paragraph (h)(1)(vi) of the proposal that would have prohibited states from imposing any restrictions, direct or indirect, on employee withdrawals from their IRAs. The proposal provided that a state program must not “require that an employee or beneficiary retain any portion of contributions or earnings in his or her IRA and does not otherwise impose any restrictions on withdrawals or impose any cost or penalty on transfers or rollovers permitted under the Internal Revenue Code.” The purpose of this prohibition, as explained in the proposal's preamble, was to make sure that employees would have meaningful control over the assets in their IRAs.20

20 80 FR 72006, 72010 (Nov. 18, 2015).

The first reason commenters gave for removing this condition was that it would interfere with the states' ability to guard against “leakage” (i.e., the use of long-term savings for short-term purposes). Absent such prohibition, states might seek to prevent leakage by, for example, requiring workers to wait until a specified age (e.g., age 55 or 60) before they have access to their money, subject to an exception for “hardship withdrawals.” Since the states deal directly with the effects of geriatric poverty, they have a substantial interest in controlling leakage, and the proposal's prohibition against withdrawal restrictions could undermine that interest.21

21See Comment Letter # 39 (AARP) (“Increasingly, states are realizing that if retired individuals do not have adequate income, they are likely to be a burden on state resources for housing, food, and medical care. For example, according to a recent Utah study, the total cost to taxpayers for new retirees in that state will top $3.7 billion over the next 15 years.”).

The commenters' second reason for removal was that the proposal's prohibition would interfere with the states' ability to design programs with diversified investment strategies, including investment options where immediate liquidity is not possible, but where participants may see better performance with lower costs. For instance, some state payroll deduction savings programs may wish to use default or alternative investment options that include partially or fully guaranteed returns but do not provide immediate liquidity. In addition, some state payroll deduction savings programs may wish to pool and manage default investments using strategies and investments similar to those for defined benefit plans covering state employees, which typically include lock ups and restrictions ranging from months to years. The commenters assert that these long-term investments tend to provide greater returns than similar investments with complete liquidity (such as daily-valued mutual or bank funds), but would not have been permitted under the proposal's prohibition.

The third reason given by commenters was that the proposal's prohibition would interfere with the states' ability to offer lifetime income options, such as annuities. One consumer organization commented, for instance, that the proposed prohibition “may have the effect of preventing states from requiring an annuity payout (or even permitting an annuity payout option). . . .” 22 Another commenter stated, “as drafted, the withdrawal restriction can be read to apply at the investment-product level, which could impede an arrangement's ability to offer an investment that includes lifetime income features. Absence of immediate liquidity is an actuarially necessary element for many products that guarantee income for life, and there is no policy basis for excluding investment options that incorporate such features.” 23

22 Comment Letter # 65 (Pension Rights Center).

23 Comment Letter # 44 (TIAA-CREF).

The fourth reason given for removal was that the proposal's prohibition was not relevant to determining under ERISA section 3(2) whether the state program, including employer behavior thereunder, constitutes “establishment or maintenance” of an employee benefit plan; or the Department's stated goal of crafting conditions that would limit employer involvement.

The Department agrees in many respects with these arguments and has removed this prohibition from the final regulation. Although the Department included this prohibition in the proposal to make sure that employees would have meaningful control over the assets in their IRAs, the Department has concluded that determinations regarding the necessity for such a prohibition are better left to the states. Based on established principles of federalism, it is more appropriately the role of the states, and not the Department, to determine what constitutes meaningful control of IRA assets in this non-ERISA context, subject to any federal law under the Department's jurisdiction—in this case, the prohibited transaction provisions in section 4975 of the Internal Revenue Code (Code)—applicable to IRAs.

C. Ability To Use Tax Incentives or Credits

The final rule modifies the condition in the proposal that would have prohibited employers from receiving more than their actual costs of complying with state payroll deduction savings programs. The proposal provided that employers may not receive any “direct or indirect consideration in the form of cash or otherwise, other than the reimbursement of actual costs of the program to the employer. . . .” The purpose of this provision was to allow employers to recoup actual costs of complying with the state law, but nothing in excess of that amount, in order to avoid economic incentives that might effectively discourage sponsorship of ERISA plans in the future.

Several commenters urged the Department to moderate that proposal's prohibition and grant the states more flexibility to determine the most effective ways to compensate employers for their role in the state program. The majority of commenters on this issue indicated that states should be able to reward employer behavior with tax incentives or credits.24 The states themselves who commented believe it should be within their discretion whether to provide support to employers that participate in the state program, and to determine the type and amount of that support, particularly where participation in the state program is required by the state.25 Many commenters also pointed out that it would be very difficult if, as the proposal required, the state had to determine actual cost for every individual employer before providing a reimbursement.26 One commenter, for example, stated “it may be exceedingly difficult if not impossible for states to accurately calculate the `actual cost' accrued by each participating employer, and it may be impractical for the amount of each tax credit to vary by employer.” 27 The commenters generally recommended that the rule clearly establish that states are able to use tax incentives or credits, whether or not such incentives or credits vary in amount by employer or represent actual costs.

24See, e.g. , Comment Letter # 65 (Pension Rights Center).

25See, e.g., Comment Letter # 54 (Oregon Retirement Savings Board). See also Comment Letter #37 (Maryland Commission on Retirement Security and Savings).

26See, e.g. , Comment Letter # 63 (Tax Alliance for Economic Mobility).

27 Comment Letter # 56 (Aspen Institute Financial Security Program).

The Department does not intend that cost reimbursement be difficult or impractical for states to implement. Accordingly, paragraph (h)(1)(xi) of the final rule does not require employers' actual costs to be calculated. Instead, it provides that the maximum consideration the state may provide to an employer is limited to a reasonable approximation of the employer's costs (or a typical employer's costs) under the program. This would allow the state to provide consideration in a flat amount based on a typical employer's costs or in different amounts based on an estimate of an employer's expenses. This standard accommodates the commenters' request for flexibility and confirms that states may use tax incentives or credits, without regard to whether such incentives or credits equal the actual costs of the program to the employer. In order to remain within the safe harbor under this approach, however, states must ensure that their economic incentives are narrowly tailored to reimbursing employers for their costs under the payroll deduction savings programs. States may not provide rewards for employers that incentivize them to participate in state programs in lieu of establishing employee pension benefit plans.

D. Ability To Focus on Employers That Do Not Offer Savings Arrangements

The final rule modifies paragraph (h)(2)(i) of the proposal, which stated that a state program meeting the regulation's conditions would not fail to qualify for the safe harbor merely because the program is “directed toward those employees who are not already eligible for some other workplace savings arrangement.” Even though this refers to a provision (directing the program toward such employees) that is not a requirement or condition of the safe harbor but is only an example of a feature that states may incorporate when designing their automatic IRA programs, some commenters maintained that this language in paragraph (h)(2)(i) could encourage states to focus on whether particular employees of an employer are eligible to participate in a workplace savings arrangement. They maintained that such a focus could be overly burdensome for certain employers because they may have to monitor their obligations on an employee-by-employee basis, with some employees being enrolled in the state program, some in the workplace savings arrangement, and others migrating between the two arrangements. Such burden, they maintained, could also give employers an incentive not to offer a retirement plan for their employees. The Department sees merit in these comments and also understands that the relevant laws enacted thus far by the states have been directed toward those employers that do not offer any workplace savings arrangement, rather than focusing on employees who are not eligible for such programs. Thus, the final rule provides that such a program would not fail to qualify for the safe harbor merely because it is “directed toward those employers that do not offer some other workplace savings arrangement.” This language will reduce employer involvement in determining employee eligibility for the state program, and it accurately reflects current state laws.

E. Ability of Governmental Agencies and Instrumentalities To Implement and Administer State Programs

The final rule clarifies the role of governmental agencies and instrumentalities in implementing and administering state programs. Some conditions in the proposal referred to “State” while other conditions referred to “State . . . or . . . governmental agency or instrumentality of the State.” This confused some commenters who wondered whether the Department intended to limit who could satisfy particular conditions by use of these different terms. The commenters pointed out that state legislation creating payroll deduction savings programs typically also creates boards to design, implement and administer such programs on a day-to-day basis and grants to these boards administrative rulemaking authority over the program. The commenters requested clarification on whether the state laws establishing the programs would have to specifically address every condition in the safe harbor, or whether such boards would be able to address any condition not expressly addressed in the legislation through their administrative rulemaking authority.

In response to these comments, the final regulation uses the phrase “State (or governmental agency or instrumentality of the State)” throughout to clarify that, so long as the program is specifically established pursuant to state law, a state program is eligible for the safe harbor even if the state law delegates a wide array of implementation and administrative authority (such as authority for rulemaking, contracting with third-party vendors, and investing) to a board, committee, department, authority, State Treasurer, office (such as Office of the Treasurer), or other similar governmental agency or instrumentality of the state. See, e.g., § 2510.3-2(h)(1) (iii), (iv), (vi), (vii), (xi), and (h)(2)(ii). In addition, the phrase “by a State” was removed from paragraph (h)(1)(i) and the word “implement” was added to paragraph (h)(1)(ii) for further clarification. A conforming amendment also was made to paragraph (h)(2)(iii) to reflect the fact that state legislatures may delegate authority to set or change the state program's automatic contribution and escalation rates to a governmental agency or instrumentality of the state as noted above.

IV. Comments Not Requiring Changes to Proposal A. Applicability of Prohibited Transaction Protections—Code § 4975

A number of commenters sought clarification on whether, and to what extent, the protections in the prohibited transaction provisions in section 4975 of the Code would apply to the state programs covered by the safe harbor. These commenters expressed concern regarding a perceived lack of federal consumer protections under the proposed safe harbor for state payroll deduction savings programs, because such safe harbor arrangements would be exempt from ERISA coverage (including all of ERISA's protective conditions).28

28 Comment Letter # 29 (Securities Industry Financial Management Association); Comment Letter # 55 (U.S. Chamber of Commerce); Comment Letter # 62 (Investment Company Institute).

The safe harbor in the final rule is expressly conditioned on the states' use of IRAs, as defined in section 7701(a)(37) of the Code. 29 CFR 2510.3-2(h)(1). Such IRAs are subject to applicable provisions of the Code, including Code section 4975. Section 4975 of the Code includes prohibited transaction provisions very similar to those in ERISA, which protect participants and beneficiaries in ERISA plans by identifying and disallowing categories of conduct between plans and disqualified persons, as well as conduct involving fiduciary self-dealing. These prohibited transaction provisions are primarily enforced through imposition of excise taxes by the Internal Revenue Service.

Consequently, the final regulation protects employees from an array of transactions involving disqualified persons that could be harmful to employees' savings. For instance, absent an available prohibited transaction exemption,29 the safe harbor effectively prohibits a sale or exchange, or leasing, of any property between an IRA and a disqualified person; the lending of money or other extension of credit between an IRA and a disqualified person; the furnishing of goods, services, or facilities between an IRA and a disqualified person; a transfer to, or use by or for the benefit of, a disqualified person of the income or assets of an IRA; any act by a disqualified person who is a fiduciary whereby he or she deals with the income or assets of an IRA in his or her own interest or for his or her own account; and any consideration for his or her own personal account by any disqualified person who is a fiduciary from any party dealing with the IRA in connection with a transaction involving the income or assets of the IRA. 26 U.S.C. 4975(c)(1)(A)-(F).

29See Code section 4975(d) (enumerating several statutory prohibited transaction exemptions); Code section 4975(c)(2) (authorizing Secretary of the Treasury to grant exemptions from the prohibited transaction provisions in Code section 4975) and Reorganization Plan No. 4 of 1978 (5 U.S.C. App. at 237 (2012) (generally transferring the authority of the Secretary of the Treasury to grant administrative exemptions under Code section 4975 to the Secretary of Labor).

Section 4975 imposes a tax on each prohibited transaction to be paid by any disqualified person who participates in the prohibited transaction (other than a fiduciary acting only as such). 26 U.S.C. 4975(a). The rate of the tax is equal to 15 percent of the amount involved for each prohibited transaction for each year in the taxable period. Id. If the transaction is not corrected within the taxable period, the rate of the tax may be equal to 100 percent of the amount involved. 26 U.S.C. 4975(b). The term “disqualified person” includes, among others, a fiduciary and a person providing services to an IRA.

With regard to commenters who asked how the prohibited transaction provisions in section 4975 of the Code would apply to the state programs covered by the safe harbor, the final rule does not adopt any special provisions for, or accord any special treatment or exemptions to, IRAs established and maintained pursuant to state payroll deduction savings programs. The prohibited transaction rules in section 4975 of the Code apply to, and protect, the assets of these IRAs in the same fashion, and to the same extent, that they apply to and protect the assets of any traditional IRA or tax-qualified retirement plan under Code section 401(a). To the extent persons operating and maintaining these programs are fiduciaries within the meaning of Code section 4975(e)(3), or provide services to an IRA, such persons are “disqualified persons” within the meaning of Code section 4975(e)(2)(A) and (B), respectively. Their status under these sections of the Code is controlling for prohibited transaction purposes, not their status or title under state law. Accordingly, section 4975 of the Code prohibits them from, among other things, dealing with assets of IRAs in a manner that benefits themselves or any persons in whom they have an interest that may affect their best judgment as fiduciaries. Thus, persons with authority to manage or administer these programs under state law should exercise caution when carrying out their duties, including for example selecting a program administrator or making investments or selecting an investment manager or managers, to avoid prohibited transactions. Whether any particular transaction would be prohibited is an inherently factual inquiry and would depend on the facts and circumstances of the particular situation.

State programs concerned about prohibited transactions may submit an individual exemption request to the Department. Any such request should be made in accordance with the Department's Prohibited Transaction Exemption Procedures (29 CFR part 2570). The Department may grant an exemption request if it finds that the exemption is administratively feasible, in the interests of plans and of their participants and beneficiaries (and/or IRAs and of their owners), and protective of the rights of the participants and beneficiaries of such plans (and/or the owners of such IRAs).

B. Prescribing a Further Connection Between the State, Employers, and Employees

A number of commenters provided comments on whether the safe harbor should require some connection between the employers and employees covered by a state payroll deduction savings program and the state that establishes the program, and if so, what kind of connection. Some commenters favor limiting the safe harbor to state programs that cover only employees who are residents of the state and employed by an employer whose principal place of business also is within that state.30 These commenters were focused primarily on burdens on small employers, particularly those operating near state lines with employees in multiple jurisdictions. Other commenters reject the idea that the Department's safe harbor should interfere with what is essentially a question of state law and prerogative. These commenters maintain that the extent to which a state can regulate employers is already established under existing legal principles.31 The Department agrees with the latter commenters. The states are in the best position to determine the appropriate connection between employers and employees covered under the program and the states that establish such programs, and to know the limits on their ability to regulate extraterritorial conduct. Inasmuch as existing legal principles establish the extent to which the states can regulate employers, the final rule simply requires that the program be specifically established pursuant to state law and that the employer's participation be required by state law. 29 CFR 2510.3-2(h)(1)(i) and (ix). These two conditions define and limit the safe harbor to be coextensive with the state's authority to regulate employers.

30See, e.g. , Comment Letter #16 (Empower Retirement) and Comment Letter #31 (American Benefits Council).

31 Comment Letter #11 (Connecticut Retirement Security Board) (“[T]he Department need not establish its own limitations, as the United States Constitution already places limits on the ability of states to regulate extraterritorial conduct.” Citing Healy v. Beer Inst., Inc., 491 U.S. 324, 336 (1989); Allstate Ins. Co. v. Hague, 449 U.S. 302, 310 (1981)).

C. Assuming Responsibility for the Security of Payroll Deductions

A number of commenters provided comments on paragraph (h)(1)(iii) of the proposal, which in relevant part provides that a state must “assume[] responsibility for the security of payroll deductions . . . .” Many commenters representing states were concerned that this condition might be construed to hold states strictly liable for payroll deductions, even in extreme cases such as, for example, fraud or theft by employers.

This condition does not make states guarantors or hold them strictly liable for any and all employers' failures to transmit payroll deductions. Rather, this condition would be satisfied if the state established and followed a process to ensure that employers transmit payroll deductions safely, appropriately and in a timely fashion.

Nor does this condition contemplate only a single approach to satisfy the safe harbor. For instance, some states have freestanding wage withholding and theft laws, as well as enforcement programs (such as audits) to protect employees from wage theft and similar problems. Such laws and programs ordinarily would satisfy this condition of the safe harbor if they are applicable to the payroll deductions under the state payroll deduction savings program and enforced by state agents. Other states, however, have adopted, or are considering adopting, timing and enforcement provisions specific to their payroll deduction savings programs.32 In the Department's view, the safe harbor would permit this approach as well.

32 Connecticut Retirement Security Program, P.A. 16-29, §§ 7(e) and 10(b) (2016).

Some commenters requested that the Department expand paragraph (h)(1)(iii) by adding several conditions to require states to adopt various consumer protections, such as conditions requiring deposits to be made to IRAs within a maximum number of days, civil and criminal penalties for deposit failures, and education programs for employees regarding how to identify employer misuse of payroll deductions. The Department encourages the states to adopt consumer protections along these lines, as necessary or appropriate. The Department declines the commenters' suggestion to make them explicit conditions of the safe harbor, however, as each state is best positioned to calibrate the type of consumer protections needed to secure payroll deductions. Accordingly, the final rule adopts the proposal's provision without change.

D. Requiring Employer's Participation To Be “Required by State Law” 1. In General

A number of commenters raised concerns with paragraph (h)(1)(x) of the proposal, which in relevant part states that the employer's participation in the program must be “required by State law[.]” Several commenters representing states and financial service providers requested that the Department not include this condition in the final rule. These commenters believe the safe harbor should extend to employers that choose whether or not to participate in a state payroll deduction savings program with automatic enrollment, as long as the state—and not the employer—thereafter controls and administers the program. Another commenter asserted that automatic enrollment “goes to whether a plan is `completely voluntary' or `voluntary' for an employee and should not be used as a material measure of how limited an employer's involvement is, especially in this case where the employer has no say in whether automatic enrollment is provided for under the state-run arrangement.”

It is the Department's view that an employer that voluntarily chooses to automatically enroll its employees in a state payroll deduction savings program has established a pension plan under ERISA and should not be eligible for a safe harbor exclusion from ERISA. ERISA broadly defines “pension plan” to encompass any “plan, fund, or program” that is “established or maintained” by an employer to provide retirement income to its employees. Under ERISA's expansive test, when an employer voluntarily chooses to provide retirement income to its employees through a particular benefit arrangement, it effectively establishes or maintains a plan. This is no less true when the employer chooses to provide the benefits through a voluntary arrangement offered by a state than when it chooses to provide the benefits through the purchase of an insurance policy or some other contractual arrangement. In either case, the employer made a voluntary decision to provide retirement benefits to its employees as part of a particular plan, fund, or program that it chose to the exclusion of other possible benefit arrangements.

In such circumstances, the employer, by choosing to participate in the state program, is effectively making plan design decisions that have direct consequences to its employees. Decisions subsumed in the employer's choice include, for example, the intended benefits, source of funding, funding medium, investment strategy, contribution amounts and limits, procedures to apply for and collect benefits, and form of distribution. By contrast, an employer that is simply complying with a state law requirement is not making any of these decisions and therefore reasonably can be viewed as complying with the safe harbor and not establishing or maintaining a pension plan under section 3(2) of ERISA.33 The state has required the employer to participate and automatically enroll its employees; the employer neither voluntarily elects to do this nor significantly controls the program. Limited employer involvement in the program is the key to a determination that the employer has not established or maintained an employee pension benefit plan. The employer's participation must be required by state law—if it is voluntary, the safe harbor does not apply.

33 One commenter asserted that the proposal contrasted with the Department's prior positions on ERISA preemption, and cited the Department's amicus brief in Golden Gate Rest. Ass'n v. San Francisco, 546 F.3d 639 (9th Cir. 2008). Because arrangements that comply with the safe harbor are being determined by regulation not to be ERISA plans, the Department sees its position in the Golden Gate case as distinguishable from its position here. The commenter also argued that the Supreme Court opinion in Fort Halifax Packing Co. v. Coyne, 482 U.S. 1 (1987), where the court found that a state law requiring employers to make severance payments to employees under certain circumstance was not preempted by ERISA because it did not require establishment of an ongoing administrative scheme, was not support for the Department's proposal. Although such an ongoing scheme may be a necessary element of a plan, it is not, as evidenced by the Department's earlier safe harbors, sufficient to establish an employee benefit plan under ERISA where other conditions—such as being established or maintained by an employer or employee organization, or both—are absent.

The 1975 IRA Payroll Deduction Safe Harbor is still available, however, to interested parties who voluntarily choose to facilitate employees' participation in a state program, if the conditions of that safe harbor are met and if permitted under the state payroll deduction savings program. As discussed above, the 1975 IRA Payroll Deduction Safe Harbor has terms and conditions substantially similar to those in the safe harbor being adopted today, but it does not permit automatic enrollment, even if accompanied by an option to opt out. Thus, if a state payroll deduction savings program permits employees of employers that are not subject to the state's automatic enrollment requirement to affirmatively choose to participate in the program, neither such participation nor the employer's facilitation of that participation would result in the employer having established an ERISA-covered plan, as long as the employer and state program satisfy the conditions in the 1975 IRA Payroll Deduction Safe Harbor.

Some commenters asserted that the Department was arbitrary in interpreting the 1975 safe harbor to prohibit automatic enrollment. However, as discussed at greater length in the NPRM, the Department's interpretation of the “completely voluntary” provision in the safe harbor is a reasonable reading of the safe harbor condition supported by legal authorities interpreting the concept of “completely voluntary” in other contexts. The interpretation of the safe harbor is also consistent with a legitimate policy concern about employers implementing “opt-out” provisions in employer-endorsed IRA arrangements without having to comply with ERISA duties and consumer protection provisions. That concern is not present with respect to state programs that require employers to auto-enroll employees in a state sponsored IRA program.

One commenter asserted that the Department's analysis in the proposal of whether an automatic payroll deduction savings program operated by a state is an ERISA plan conflicts with the analysis in the interpretive bulletin relating to whether a state can sponsor a multiple employer plan. This comment misapprehends the Department's position in this rulemaking. If the state and the employer comply with the safe harbor conditions, the Department's view is that no ERISA plan is established. Although the interpretive bulletin indicates that a state may under some circumstances act for (in the interest of) a group of voluntarily participating employers in establishing an ERISA-covered multiple employer plan, the bulletin does not mean a state would be similarly acting for employers when it requires that they participate in a program requiring the offering of a savings arrangement that is not an ERISA plan.

2. Special Treatment for Reduction in Size of Employer

Several commenters raised the issue whether the final rule could or should address situations in which an employer that was once required to participate in a state program ceases to be subject to the state requirement due to a change in its size. These commenters noted that most state payroll deduction IRA laws contain an exemption for small employers. In California and Connecticut, for instance, employers with fewer than 5 employees are not subject to the state law requirement.34 In Illinois, the exemption is available to employers with fewer than 25 employees.35 Thus, as the commenters noted, an employer that is subject to the requirement could subsequently drop below a state's threshold number of employees, and into the exemption, simply by having one employee resign. The commenters asked whether an employer that falls below the minimum number of employees could continue to make payroll deductions for existing employees (or automatically enroll new employees) under the program and still meet the conditions of the Department's safe harbor.

34 Cal. Gov't Code § 100000(d) (2012); Conn. P.A. 16-29, § 1(7) (2016).

35 820 Ill. Comp. Stat. 80/5 (2015).

The situation identified by the commenters results from the operation of the particular state law and is properly a matter for the states to address. For example, a state law with the type of small employer exemption discussed above could require that an employer, once subject to the participation requirement, remains subject to it (either permanently or at least for the balance of the year or some other specified period of time), without regard to future fluctuations in workforce size. A state might also require an employer to maintain payroll deductions for employees who were enrolled when the employer was subject to the requirement, but not require the employer to make deductions for new employees until after its work force has regained the minimum number of employees. An employer that ceases to be subject to a state participation requirement, but that continues the payroll deductions or automatically enrolls new employees into the state program, would be acting outside the boundaries of the new safe harbor. However, its continued participation in the program would reflect its voluntary decision to provide retirement benefits pursuant to a particular plan, fund, or program. Accordingly, it would thereby establish or maintain an ERISA-covered plan.

Nevertheless, if the state allows but does not require an exempted small employer to enroll employees in the program, the employer may be able to do so without establishing an ERISA plan if the employer complies with the conditions of the Department's 1975 IRA Payroll Deduction Safe Harbor, which ensure minimal employer involvement in the employees' completely voluntary decision to participate in particular IRAs. To comply with these conditions, the employer would not be able to make payroll deductions for employees without their affirmative consent.

In the event that an employer establishes its own ERISA-covered plan under a state program, that plan would be subject to ERISA's reporting, disclosure, and fiduciary standards. In such circumstances, the employer generally would be considered the “plan sponsor” and “administrator” of its plan, as defined in section 3(16) of ERISA.36 The Department would not, however, view the establishment of an ERISA plan by an employer participating in the state program as affecting the availability of the safe harbor for other participating employers.

36 Commenters requested that this regulation provide a method for employers or states that inadvertently take actions causing an arrangement or program to fail to satisfy the safe harbor to cure that failure and qualify for the safe harbor. Commenters also requested that this regulation allow employers to cure ERISA failures that might result from the creation of an ERISA plan. Although these issues are beyond the scope of this regulation, if problems arise relating to these topics for particular state programs, the Department invites states and other interested persons to ask the Department to consider whether some additional guidance or relief would be appropriate.

E. Extending the Safe Harbor to Political Subdivisions

A number of commenters urged the Department to expand the safe harbor to cover payroll deduction savings programs established by political subdivisions of states. The proposal was limited to payroll deduction savings programs established by “States.” For this purpose, the proposal defined the term “State” by reference to section 3(10) of ERISA. Section 3(10) of ERISA, in relevant part, defines the term “State” as including “any State of the United States, the District of Columbia, Puerto Rico, the Virgin Islands, American Samoa, Guam, [and] Wake Island.” Thus, the proposed safe harbor was not available to payroll deduction savings programs established by political subdivisions of states, such as cities and counties.

These commenters argued that the proposal would be of little or no use for employees of employers in political subdivisions in states that choose not to have a state-wide program, even though there is strong interest in a payroll deduction savings program at a political subdivision level, such as New York City, for example.37 These commenters asked the Department to consider extending the safe harbor in the proposal essentially to large political subdivisions (in terms of population) with authority and capacity to maintain such programs.38 Others, however, are concerned that such an expansion might lead to overlapping and possibly conflicting requirements on employers, both within and across states.

37See, e.g., Comment Letter #57 (The Public Advocate for the City of New York) (“The United States Department of Labor's proposed rule reflects the Department's clear understanding of the dire need for policymakers to develop retirement security solutions for millions of Americans. However, we are concerned that by not including cities in its proposed rule, in particular those with populations over a certain size—such as one million residents—the Department could significantly thwart the positive objectives of the proposed rule.”).

38See, e.g., Comment Letter #36 (AFL-CIO) (“With respect to political subdivisions of a state, we suggest the Department establish minimum eligibility requirements to ensure that the political entity has the administrative capacity and sophistication necessary to administer a retirement savings arrangement, protect the rights of participating workers, and ensure the security of workers' payroll deductions and retirement savings. The Department could use easily measured proxies for administrative capacity and sophistication. For example, total population of a political subdivision as measured by the most recent decennial census or an interim population estimate published by the U.S. Census Bureau would be an appropriate proxy. The eligibility threshold could be set at or near the total population of the smallest of the 50 states, such as 500,000.”).

The Department agrees with commenters that there may be good reasons for expanding the safe harbor, but believes its analysis of the issue would benefit from additional public comments. Accordingly, in the Proposed Rules section of today's Federal Register, the Department published a notice of proposed rulemaking seeking to amend paragraph (h) of § 2510.3-2 to cover certain state political subdivision programs that otherwise comply with the conditions in the final rule. The proposal seeks public comment on not only whether, but also how to amend paragraph (h) of § 2510.3-2 to include political subdivisions of states. Commenters are encouraged to focus on how broadly or narrowly an amended safe harbor might define the term “qualified political subdivision” taking into account the impact of such an expansion on employers, employees, political subdivisions, and states themselves.39

39 Some commenters asked whether states could join together in multi-state programs. Nothing in the safe harbor precludes states from agreeing to coordinate state programs or to act in unison with respect to a program.

V. Regulatory Impact Analysis A. Executive Order 12866 Statement

Under Executive Order 12866, the Office of Management and Budget (OMB) must determine whether a regulatory action is “significant” and therefore subject to the requirements of the Executive Order and subject to review by the OMB. Section 3(f) of the Executive Order defines a “significant regulatory action” as an action that is likely to result in a rule (1) having an annual effect on the economy of $100 million or more, or adversely and materially affecting a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or state, local or tribal governments or communities (also referred to as an “economically significant” action); (2) creating serious inconsistency or otherwise interfering with an action taken or planned by another agency; (3) materially altering the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raising novel legal or policy issues arising out of legal requirements, the President's priorities, or the principles set forth in the Executive Order.

OMB has determined that this regulatory action is not economically significant within the meaning of section 3(f)(1) of the Executive Order. However, it has determined that the action is significant within the meaning of section 3(f)(4) of the Executive Order. Accordingly, OMB has reviewed the final rule and the Department provides the following assessment of its benefits and costs.

Several states have adopted or are considering adopting state payroll deduction savings programs to increase access to retirement savings for individuals employed or residing in their jurisdictions. As stated above, this document amends existing Department regulations by adding a new safe harbor describing the circumstances under which such payroll deduction savings programs, including programs featuring automatic enrollment, would not give rise to the establishment or maintenance of ERISA-covered employee pension benefit plans. State payroll deduction savings programs that meet the requirements of the safe harbor would be established by states, and state law would require certain private-sector employers to participate in such programs. By making clear that state payroll deduction savings programs with automatic enrollment that conform to the safe harbor in the final rule do not give rise to the establishment of ERISA-covered plans, the objective of the safe harbor is to reduce the risk of such state programs being preempted if they were challenged.

In analyzing benefits and costs associated with this final rule, the Department focuses on the direct effects, which include both benefits and costs directly attributable to the rule. These benefits and costs are limited, because as stated above, the final rule merely establishes a safe harbor describing the circumstances under which such state payroll deduction savings programs would not give rise to ERISA-covered employee pension benefit plans. It does not require states to take any actions nor employers to provide any retirement savings programs to their employees.

The Department also addresses indirect effects associated with the rule, which include potential benefits and costs directly associated with the scope and provisions of the state laws creating the programs, and include the potential increase in retirement savings and potential cost burden imposed on covered employers to comply with the requirements of the state programs. Indirect effects vary by state depending on the scope and provisions of the state law, and by the degree to which the rule might influence state actions.

1. Direct Benefits

As discussed earlier in this preamble, some state legislatures have passed laws designed to expand workers' access to workplace savings arrangements, including states that have established state payroll deduction savings programs. Through automatic enrollment such programs encourage employees to establish IRAs funded by payroll deductions. As noted, California, Connecticut, Illinois, Maryland, and Oregon, for example, have adopted laws along these lines. In addition, some states are looking at ways to encourage employers to provide coverage under state-administered 401(k)-type plans, while others have adopted or are considering approaches that combine several retirement alternatives including IRAs and ERISA-covered plans.

One of the challenges states face in expanding retirement savings opportunities for private-sector employees is uncertainty about ERISA preemption of such efforts. ERISA generally would preempt a state law that required employers to establish or maintain ERISA-covered employee benefit pension plans. The Department therefore believes that states and other stakeholders would benefit from clear guidelines to determine whether state saving initiatives would effectively require employers to create ERISA-covered plans. The final rule would provide a new “safe harbor” from coverage under Title I of ERISA for state savings arrangements that conform to certain requirements. State initiatives within the safe harbor would not result in the establishment of employee benefit plans under ERISA. The Department expects that the final rule would reduce legal costs, including litigation costs, by (1) removing uncertainty about whether such state savings arrangements are covered by Title I of ERISA, and (2) creating efficiencies by eliminating the need for multiple states to incur the same costs to determine their non-plan status.

The Department notes that the final rule would not prevent states from identifying and pursuing alternative policies, outside of the safe harbor, that also would not require employers to establish or maintain ERISA-covered plans. Thus, while the final rule would reduce uncertainty about state activity within the safe harbor, it would not impair state activity outside of it.

Some comments expressed concern about whether the safe harbor rule requires employers to participate in states' savings arrangements, and whether it implicitly indicates the Department's views on arrangements that do not fully conform to the conditions of the safe harbor. To address these concerns, the Department added regulatory text in the final rule explicitly recognizing that the regulation is a safe harbor and as such, does not require employers to participate in state payroll deduction savings programs or arrangements nor does it purport to define every possible program that could fall outside of Title I of ERISA.

2. Direct Costs

The final rule does not require any new action by employers or the states. It merely establishes a safe harbor describing certain circumstances under which state-required payroll deduction savings programs would not give rise to an ERISA-covered employee pension benefit plan. States may incur legal costs to analyze the rule and determine whether their laws fall within the final rule's safe harbor. However, the Department expects that these costs will be less than the costs that would be incurred in the absence of the final rule.

3. Uncertainty

The Department is confident that the final safe harbor rule, by clarifying that certain state payroll deduction savings programs do not require employers to establish ERISA-covered plans, will benefit states and many other stakeholders otherwise beset by greater uncertainty. However, the Department is unsure as to the magnitude of these benefits. The magnitude of the final rule's benefits, costs and transfer impacts will depend on the states' independent decisions on whether and how best to take advantage of the safe harbor and on the cost that otherwise would have attached to uncertainty about the legal status of the states' actions. The Department cannot predict what actions states will take, stakeholders' propensity to challenge such actions' legal status, either absent or pursuant to the final rule, or courts' resultant decisions.

4. Indirect Effects of Safe Harbor Rule: Impact of State Initiatives

As discussed above, the impact of state payroll deduction saving programs is directly attributable to the state legislation that creates such programs. As discussed below, however, under certain circumstances, these effects could be indirectly attributable to the final rule. For example, it is conceivable that more states could create payroll deduction savings programs due to the guidelines provided in the final rule and the reduced risk of an ERISA preemption challenge, and therefore, the increased prevalence of such programs would be indirectly attributable to the final rule. If this issue were ultimately resolved in the courts, the courts could make a different preemption decision in the rule's presence than in its absence. Furthermore, even if a potential court decision would be the same with or without the rulemaking, the potential reduction in states' uncertainty-related costs could induce more states to pursue these workplace savings initiatives. An additional possibility is that the rule would not change the prevalence of state payroll deduction savings programs, but would accelerate the implementation of programs that would exist anyway. With any of these possibilities, there would be benefits, costs and transfer impacts that are indirectly attributable to this rule, via the increased or accelerated creation of state programs.

Commenters expressed concern that states will incur substantial costs to implement their payroll deduction savings programs. One state estimates that it will incur $1.2 million in administrative and operating costs during the initial start-up years.40 To administer its opt-out process, the same state estimates it will incur $465,000 in one-time mailing and form production costs.41 Another state estimated that it will take several years before its savings arrangement becomes self-sufficient and it would require a subsidy of between $300,000 and $500,000 a year for five to seven years.42 Commenters also raised concerns about the states' potential fiduciary liability associated with establishing state payroll deduction savings programs.

40 Department of Finance Bill Analysis, California Department of Finance (May 2, 2012).

41Id.

42 Voluntary Employee Accounts Program Study, Maryland Supplemental Requirement Plans (2008).

The Department is aware of these potential costs, and although the commenters raise valid concerns, the costs are not directly attributable to the final rule; they are attributable to the state legislation creating the payroll deduction savings program. In enacting their programs, states are responsible for estimating the associated costs during the legislative process and determining whether the arrangement is self-sustainable and whether the state has sufficient resources to bear the associated costs and financial risk. States can design their programs to address these concerns, and presumably, will enact state payroll deduction legislation only after determining that the benefits of such programs justify their costs.

Employers may incur costs to update their payroll systems to transmit payroll deductions to the state or its agent, develop recordkeeping systems to document their collection and remittance of payments under the program, and provide information to employees regarding the state savings arrangement. As with states' operational and administrative costs, some portion of these employer costs would be indirectly attributable to the rule if more state payroll deduction savings programs are implemented in the rule's presence than would be in its absence. Because the employers' administrative burden to participate in the state program is generally limited to withholding the required contribution from employees' wages, remitting contributions to the state program, and providing information about the program to employees in order to satisfy the safe harbor, most associated costs for employers would be minimal.

Although such costs would be limited for employers, several commenters expressed concern that these costs would be incurred disproportionately by small employers and start-up companies, which tend to be least likely to offer pensions. According to one survey submitted with a comment, about 60% of small employers do not use a payroll service.43 The commenters assert that these small employers may incur additional costs to use external payroll companies to comply with their states' payroll deduction savings programs. However, some small employers may decide to use a payroll service to withhold and remit payroll taxes independent of their state's program requirements. Therefore, the extent to which these costs can be attributable to states' initiatives could be smaller than what commenters estimated. Moreover, most state payroll deduction savings programs exempt the smallest companies,44 which could mitigate such costs.

43 National Small Business Association, April 11, 2013, “2013 Small Business Taxation Survey.” This survey says 23% of small employers that handle payroll taxes internally have no employee. Therefore, only about 46%, not 60%, of small employers are in fact affected by state initiatives, based on this survey. The survey does not include small employers that use payroll software or on-line payroll programs, which provide a cost effective means for such employers to comply with payroll deduction savings programs.

44 For example, California Secure Choice would affect employers with 5 or more employees, Illinois Secure Choice would affect employers with 25 or more employees, and Connecticut Retirement Security would affect employers with 5 or more employees. Cal. Gov.t Code § 100000(d) (2012); 820 Ill. Comp. Stat. 80/5 (2015); Conn. P.A. 16-29 § 1(7) (2016).

Additional cost-related comments addressed penalties that employers are subject to pay if they fail to comply with the requirements of their states' programs.45 The commenter argued that those penalties would be more detrimental to small employers because profit margins of small employers are often very thin. However, the costs associated with those penalties are due to a failure to comply with state law. In addition, the final rule accommodates commenters and allows states to use tax incentives or credits as long as their economic incentives are narrowly tailored to reimbursing the costs of states' payroll deduction savings programs. If states reimburse employers for costs incurred to comply with their payroll deduction savings programs, the employers' cost burden can be substantially reduced.

45 For example, according to a comment letter, the Illinois Secure Choice Savings Program allows for a penalty for noncompliance in the first year of $250 per employee per year, which then increases to $500 for noncompliance per employee for each subsequent year.

While several comments focused on the cost burden imposed on small employers, an organization representing small employers expressed support for state efforts to establish state payroll deduction savings arrangements, because such arrangements provide a convenient and affordable option for small businesses and their employees to save for retirement. This commenter further states that small business owners want to offer the benefit of retirement savings to their employees because it would help them attract and retain talented employees.

The Department believes that well-designed state-level initiatives have the potential to effectively reduce gaps in retirement security. Relevant variables such as pension coverage,46 labor market conditions,47 population demographics,48 and elderly poverty,49 vary widely across the states, suggesting a potential opportunity for progress at the state level. Many workers throughout these states currently may save less than would be optimal because of (1) behavioral biases (such as myopia or inertia), (2) labor market conditions that prevent them from accessing plans at work, or (3) they work for employers that simply do not offer retirement plans.50 Some research suggests that automatic contribution policies are effective in increasing retirement savings and wealth in general by overcoming behavioral biases or inertia.51 Well-designed state initiatives could help many savers who otherwise might not be saving enough or at all to begin to save earlier than they might have otherwise. Such workers will have traded some consumption today for more in retirement, potentially reaping net gains in overall lifetime well-being. Their additional savings may also reduce fiscal pressure on publicly financed retirement programs and other public assistance programs, such as the Supplemental Nutritional Assistance Program, that support low-income Americans, including older Americans.

46See, e.g. ,, Craig Copeland, “Employment-Based Retirement Plan Participation: Geographic Differences and Trends, 2013,” Employee Benefit Research Institute, Issue Brief No. 405 (October 2014) (available at www.ebri.org). See also a report from the Pew Charitable Trusts, “How States Are Working to Address The Retirement Savings Challenge,” (June 2016).

47See, e.g. , U.S. Bureau of Labor Statistics, “Regional and State Employment and Unemployment—JUNE 2015,” USDL-15-1430 (July 21, 2015).

48See, e.g. , Lindsay M. Howden and Julie A. Meyer, “Age and Sex Composition: 2010,” U.S. Bureau of the Census, 2010 Census Briefs C2010BR-03 (May 2011).

49 Constantijn W. A. Panis & Michael Brien, “Target Populations of State-Level Automatic IRA Initiatives,” (August 28, 2015).

50 According to National Compensation Survey, March 2015, about 69% of private-sector workers have access to retirement benefits—including Defined Benefit and Defined Contribution plans—at work.

51See Chetty, Friedman, Leth-Petresen, Nielsen & Olsen, “Active vs. Passive Decisions and Crowd-out in Retirement Savings Accounts: Evidence from Denmark,” 129 Quarterly Journal of Economics 1141-1219 (2014); See also Madrian and Shea, “The Power of Suggestion: Inertia in 401(k) Participation and Savings Behavior,” 116 Quarterly Journal of Economics 1149-1187 (2001).

However, several commenters were skeptical about potential benefits of state payroll deduction savings arrangements. These commenters believe the potential benefits—primarily increases in retirement savings—would be limited because the proposed safe harbor rule does not allow employer contributions to state payroll deduction programs.

The Department believes that well-designed state initiatives can achieve their intended, positive effects of fostering retirement security. However, the initiatives might have some unintended consequences as well. Those workers least equipped to make good retirement savings decisions arguably stand to benefit most from state initiatives, but also arguably could be at greater risk of suffering adverse unintended effects. Workers who would not benefit from increased retirement savings could opt out, but some might fail to do so. Such workers might increase their savings too much, unduly sacrificing current economic needs. Consequently they might be more likely to cash out early and suffer tax losses (unless they receive a non-taxable Roth IRA distribution), and/or to take on more expensive debt to pay necessary bills. Similarly, state initiatives directed at workers who do not currently participate in workplace savings arrangements may be imperfectly targeted to address gaps in retirement security. For example, some college students might be better advised to take less in student loans rather than open an IRA, and some young families might do well to save more first for their children's education and later for their own retirement. This concern was shared by some commenters who stated that workers without retirement plan coverage tend to be younger, lower-income or less attached to the workforce, which implies that these workers are often financially stressed or have other savings goals. These comments imply that the benefits of state payroll deduction savings arrangements could be limited and in some cases potentially harmful for certain workers. The Department notes that the states are responsible for designing effective programs that minimize these types of harm and maximize benefits to participants.

Some commenters also raised the concern that state initiatives may “crowd-out” ERISA-covered plans. According to one comment, the proposed rule could inadvertently encourage large employers operating in multiple states to switch from ERISA-covered plans to state-run arrangements in order to reduce costs, especially if they are required to cover employees currently ineligible to participate in ERISA-covered plans under state-run arrangements. Some commenters were concerned about employers' burden to monitor their obligations under the state laws particularly when employers operate in multiple states. These commenters raised the possibility that large employers would incur substantial costs to monitor the participation status of ineligible workers, such as part-time or seasonal workers. The final rule clarifies that state payroll deduction savings programs directed toward employers that do not offer other retirement plans fall within this safe harbor rule. However, employers that wish to provide retirement benefits are likely to find that ERISA-covered programs, such as 401(k) plans, have advantages for them and their employees over participation in state programs. Potential advantages include significantly greater tax preferences, greater flexibility in plan selection and design, opportunity for employers to contribute, ERISA protections, and larger positive recruitment and retention effects. Therefore it seems unlikely that state initiatives will “crowd-out” many ERISA-covered plans, although, if they do, some workers might lose ERISA-protected benefits that could have been more generous and more secure than state-based (IRA) benefits if states do not adopt consumer protections similar to those Congress provided under ERISA.

There is also the possibility that some workers who would otherwise have saved more might reduce their savings to the low, default levels associated with some state programs. States can address this concern by incorporating into their programs participant education or “auto-escalation” features that increase default contribution rates over time and/or as pay increases.

Some commenters were concerned that state payroll deduction savings arrangements would in general provide participants with less consumer protection than ERISA-covered plans. Another commenter pointed out that one particular state's payroll deduction savings program would require employees to pay higher fees than those charged to private plans.52 However, a careful review of the report cited in this comment suggests that fees set by this particular state's arrangement are not inconsistent with the average fees in the mutual fund industry.53 Moreover, the Department reiterates that states enacting savings arrangements can take actions to augment consumer protections.

52 According to a comment letter, Illinois' Secure Choice Savings Program stated that the costs of fees paid by employees will be charged up to 0.75 percent of the overall balances, which is higher than those charged to 401(k) plan participants who invested in equity mutual funds (0.58 percent).

53 According to the ICI Research Perspective, “The Economics of Providing 401(k) Plans: Services, Fees, and Expenses, 2014,” the mutual fund industry average expense ratio was 0.74 percent in 2013 and in 0.70 percent in 2014, which are in the comparable range to the Illinois Secure Choice Savings Program's ceiling in fees, 0.75 percent.

B. Paperwork Reduction Act

In accordance with the requirements of the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3506(c)(2)), the Department solicited comments regarding its determination that the proposed rule is not subject to the requirements of the PRA, because it does not contain a “collection of information” as defined in 44 U.S.C. 3502(3). The Department's conclusion was based on the premise that the proposed rule did not require any action by or impose any requirements on employers or states. It merely clarified that certain state payroll deduction savings programs that encourage retirement savings would not result in the creation of ERISA-covered employee benefit plans if the conditions of the safe harbor were met.

The Department did not receive any comments regarding this assessment. Therefore, the Department has determined that the final rule is not subject to the PRA, because it does not contain a collection of information. The PRA definition of “burden” excludes time, effort, and financial resources necessary to comply with a collection of information that would be incurred by respondents in the normal course of their activities. See 5 CFR 1320.3(b)(2). The definition of “burden” also excludes burdens imposed by a state, local, or tribal government independent of a Federal requirement. See 5 CFR 1320.3(b)(3). The final rule imposes no burden on employers because states customarily include notice and recordkeeping requirements when enacting their payroll deduction savings programs. Thus, employers participating in such programs are responding to state, not Federal, requirements.

C. Regulatory Flexibility Act

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

Although several commenters maintained that the proposed rule would impose significant costs on small employers, similar to the proposal, the final rule merely establishes a new safe harbor describing circumstances in which state payroll deduction savings programs would not give rise to ERISA-covered employee pension benefit plans. Therefore, the final rule imposes no requirements or costs on small employers, and the Department believes that it will not have a significant economic impact on a substantial number of small entities. Accordingly, pursuant to section 605(b) of the RFA, the Assistant Secretary of the Employee Benefits Security Administration hereby certifies that the final rule will not have a significant economic impact on a substantial number of small entities.

D. Unfunded Mandates Reform Act

For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1501 et seq.), as well as Executive Order 12875, this final rule does not include any federal mandate that may result in expenditures by state, local, or tribal governments, or the private-sector, which may impose an annual burden of $100 million.

E. Congressional Review Act

The final rule is subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.) and will be transmitted to Congress and the Comptroller General for review. The final rule is not a “major rule” as that term is defined in 5 U.S.C. 804, because it is not likely to result in (1) an annual effect on the economy of $100 million or more; (2) a major increase in costs or prices for consumers, individual industries, or Federal, State, or local government agencies, or geographic regions; or (3) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign- based enterprises in domestic and export markets.

F. Federalism Statement

Executive Order 13132 outlines fundamental principles of federalism. It also requires adherence to specific criteria and requirements, such as consultation with state and local officials, in the case of policies that have federalism implications, defined as “regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on the states, on the relationship between the national government and states, or on the distribution of power and responsibilities among the various levels of government.”

The final rule describes circumstances under which a state payroll deduction savings program would not constitute the establishment or maintenance of an ERISA-covered plan by specified actors. Such guidance may therefore be helpful to states that have taken or might take action, but the safe harbor does not limit the actions that states could take. The safe harbor does not require states to do anything or preempt state law. Nor does it act directly on a state, or cause any state to do anything the state had not already decided or is inclined to do on its own. For example, as described elsewhere in this final rule, a state program that fell outside the terms of the safe harbor would not necessarily result in the creation of ERISA plans. The regulation itself is devoid of consequences to the state or states that decide not to follow its terms. In other words, the regulation may indirectly influence how states design their payroll deduction savings programs, but its existence is unlikely to be dispositive on whether states adopt programs in the first instance, as evidenced by some states that already enacted legislation. Therefore, the final rule does not contain polices with federalism implications within the meaning of the Order.

Nonetheless, in respect for the fundamental federalism principles set forth in the Order, the Department affirmatively engaged in outreach with officials of states, and with employers and other stakeholders, regarding the proposed rule and sought their input on any federalism implications that they believe may be presented by the safe harbor. Departmental staff engaged in numerous meetings, conference calls, and outreach events with interested stakeholders on the proposed rule and on various state legislative proposals. The Department also received numerous comment letters from states and local governments and their representatives. Many of the changes in the final rule stem from suggestions contained in these comment letters. Indeed, the notice of proposed rulemaking on political subdivisions discussed earlier in this preamble also stems from comments and concerns raised by state or local governments.

List of Subjects in 29 CFR Part 2510

Accounting, Employee benefit plans, Employee Retirement Income Security Act, Pensions, Reporting, Coverage.

For the reasons stated in the preamble, the Department of Labor amends 29 CFR part 2510 as set forth below:

PART 2510—DEFINITIONS OF TERMS USED IN SUBCHAPTERS C, D, E, F, G, AND L OF THIS CHAPTER 1. The authority citation for part 2510 is revised to read as follows: Authority:

29 U.S.C. 1002(2), 1002(21), 1002(37), 1002(38), 1002(40), 1031, and 1135; Secretary of Labor's Order No. 1-2011, 77 FR 1088 (Jan. 9, 2012); Sec. 2510.3-101 also issued under sec. 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. at 237 (2012), E.O. 12108, 44 FR 1065 (Jan. 3, 1979) and 29 U.S.C. 1135 note. Sec. 2510.3-38 is also issued under sec. 1, Pub. L. 105-72, 111 Stat. 1457 (1997).

2. In § 2510.3-2, revise paragraph (a) and add paragraph (h) to read as follows:
§ 2510.3-2 Employee pension benefit plans.

(a) General. This section clarifies the terms “employee pension benefit plan” and “pension plan” for purposes of title I of the Act and this chapter by setting forth safe harbors under which certain specific plans, funds and programs would not constitute employee pension benefit plans when the conditions of this section are satisfied. The safe harbors in this section should not be read as implicitly indicating the Department's views on the possible scope of section 3(2). To the extent that these plans, funds and programs constitute employee welfare benefit plans within the meaning of section 3(1) of the Act and § 2510.3-1 of this part, they will be covered under title I; however, they will not be subject to parts 2 and 3 of title I of the Act.

(h) Certain State savings programs. (1) For purposes of title I of the Act and this chapter, the terms “employee pension benefit plan” and “pension plan” shall not include an individual retirement plan (as defined in 26 U.S.C. 7701(a)(37)) established and maintained pursuant to a State payroll deduction savings program, provided that:

(i) The program is specifically established pursuant to State law;

(ii) The program is implemented and administered by the State establishing the program (or by a governmental agency or instrumentality of the State), which is responsible for investing the employee savings or for selecting investment alternatives for employees to choose;

(iii) The State (or governmental agency or instrumentality of the State) assumes responsibility for the security of payroll deductions and employee savings;

(iv) The State (or governmental agency or instrumentality of the State) adopts measures to ensure that employees are notified of their rights under the program, and creates a mechanism for enforcement of those rights;

(v) Participation in the program is voluntary for employees;

(vi) All rights of the employee, former employee, or beneficiary under the program are enforceable only by the employee, former employee, or beneficiary, an authorized representative of such a person, or by the State (or governmental agency or instrumentality of the State);

(vii) The involvement of the employer is limited to the following:

(A) Collecting employee contributions through payroll deductions and remitting them to the program;

(B) Providing notice to the employees and maintaining records regarding the employer's collection and remittance of payments under the program;

(C) Providing information to the State (or governmental agency or instrumentality of the State) necessary to facilitate the operation of the program; and

(D) Distributing program information to employees from the State (or governmental agency or instrumentality of the State) and permitting the State (or governmental agency or instrumentality of the State) to publicize the program to employees;

(viii) The employer contributes no funds to the program and provides no bonus or other monetary incentive to employees to participate in the program;

(ix) The employer's participation in the program is required by State law;

(x) The employer has no discretionary authority, control, or responsibility under the program; and

(xi) The employer receives no direct or indirect consideration in the form of cash or otherwise, other than consideration (including tax incentives and credits) received directly from the State (or governmental agency or instrumentality of the State) that does not exceed an amount that reasonably approximates the employer's (or a typical employer's) costs under the program.

(2) A State savings program will not fail to satisfy the provisions of paragraph (h)(1) of this section merely because the program—

(i) Is directed toward those employers that do not offer some other workplace savings arrangement;

(ii) Utilizes one or more service or investment providers to operate and administer the program, provided that the State (or governmental agency or instrumentality of the State) retains full responsibility for the operation and administration of the program; or

(iii) Treats employees as having automatically elected payroll deductions in an amount or percentage of compensation, including any automatic increases in such amount or percentage, unless the employee specifically elects not to have such deductions made (or specifically elects to have the deductions made in a different amount or percentage of compensation allowed by the program), provided that the employee is given adequate advance notice of the right to make such elections and provided, further, that a program may also satisfy this paragraph (h) without requiring or otherwise providing for automatic elections such as those described in this paragraph (h)(2)(iii).

(3) For purposes of this section, the term State shall have the same meaning as defined in section 3(10) of the Act.

Signed at Washington, DC, this 24th day of August, 2016. Phyllis C. Borzi, Assistant Secretary, Employee Benefits Security Administration, U.S. Department of Labor.
[FR Doc. 2016-20639 Filed 8-25-16; 4:15 pm] BILLING CODE 4510-29-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [Docket Number USCG-2016-0012] RIN 1625-AA08 Special Local Regulation; Bucksport/Lake Murray Drag Boat Fall Nationals, Atlantic Intracoastal Waterway; Bucksport, SC AGENCY:

Coast Guard, DHS.

ACTION:

Temporary final rule.

SUMMARY:

The Coast Guard is establishing a special local regulation on the Atlantic Intracoastal Waterway in Bucksport, South Carolina during the Bucksport/Lake Murray Drag Boat Fall Nationals, on September 10 and September 11, 2016. This special local regulation is necessary to ensure the safety of participants, spectators, and the general public during the event. This regulation prohibits persons and vessels from being in the regulated area unless authorized by the Captain of the Port Charleston or a designated representative.

DATES:

This rule is effective from September 10, 2016 through September 11, 2016. The rule will be enforced from 1 p.m. to 7 p.m. each day it is effective.

ADDRESSES:

To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0012 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 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 Information and Regulatory History

On December 27, 2015, the Bucksport Marina notified the Coast Guard that it will sponsor a series of drag boat races from 1 p.m. to 7 p.m. on September 10, 2016 and September 11, 2016. In response, on July 10, 2016, the Coast Guard published a notice of proposed rulemaking (NPRM) titled Bucksport/Lake Murray Drag Boat Fall Nationals, Atlantic Intracoastal Waterway; Bucksport, SC, 81 FR 44815. There we stated why we issued the NPRM, and invited comments on our proposed regulatory action related to this special local regulation. During the comment period that ended August 10, 2016, we received no comments.

We are issuing this rule, and under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making it effective less than 30 days after publication in the Federal Register. Delaying the effective date of this rule would be impracticable due to the date of the event. The Coast Guard did not receive any adverse comments during the period outlined in the NPRM with regard to this rule.

III. Legal Authority and Need for Rule

The Coast Guard is issuing this rule under authority in 33 U.S.C. 1233. The purpose of the rule is to ensure safety of life on navigable waters of the United States during the Bucksport/Lake Murray Drag Boat Fall Nationals, a series of high speed boat races.

IV. Discussion of Comments, Changes, and the Rule

As noted above, we received no comments on our NPRM published July 10, 2016. There are no changes in the regulatory text of this rule from the proposed rule in the NPRM. This rule establishes a special local regulation on the Atlantic Intracoastal Waterway in Busksport, South Carolina during the Bucksport/Lake Murray Drag Boat Fall Nationals on September 10 and September 11, 2016. The special local regulation will be enforced daily from 1 p.m. until 7 p.m. on September 10 and September 11, 2016. Approximately 50 powerboats are expected to participate in the races and approximately 35 spectator vessels are expected to attend the event.

Except for those persons and vessels participating in the drag boat races, persons and vessels are prohibited from entering, transiting through, anchoring in, or remaining within any of the race areas unless specifically authorized by the Captain of the Port Charleston or a designated representative. Persons and vessels desiring to enter, transit through, anchor in, or remain within any of the race areas 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, anchor in, or remain within the race areas 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. The Coast Guard will provide notice of the regulated areas by Local Notice to Mariners, Broadcast Notice to Mariners, and on-scene designated representatives.

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

The economic impact of this rule is not significant for the following reasons: (1) The special local regulation would be enforced for only six hours a day over a two-day period; (2) although persons and vessels would not be able to enter, transit through, anchor in, or remain within the regulated area without authorization from the Captain of the Port Charleston or a designated representative, they would be able to operate in the surrounding area during the enforcement periods; (3) persons and vessels would still be able to enter, transit through, anchor in, or remain within the regulated area if authorized by the Captain of the Port Charleston or a designated representative; and (4) the Coast Guard will provide advance notification of the regulated area to the local maritime community by Local Notice to Mariners, Broadcast Notice to Mariners, and on-scene designated representatives.

B. Impact on Small Entities

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

This rule may affect the following entities, some of which may be small entities: the owner or operators of vessels intending to enter, transit through, anchor in, or remain within the regulated area during the enforcement period. For the reasons discussed in Regulatory Planning and Review section above, this rule will not have a significant economic impact on a substantial number of small entities.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this 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 rule involves a special local regulation issued in conjunction with a regatta or marine parade. This rule is categorically excluded from further review under paragraph 34(h) of Figure 2-1 of the Commandant Instruction.

An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES. We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

G. Protest Activities

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

List of Subjects in 33 CFR Part 100

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

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

PART 100—SAFETY OF LIFE ON NAVIGABLE WATERS 1. The authority citation for part 100 continues to read as follows: Authority:

33 U.S.C. 1233.

2. Add § 100.35T07-0012 to read as follows:
§ 100.35T07-0012 Bucksport/Lake Murray Drag Boat Fall Nationals, Atlantic Intracoastal Waterway; Bucksport, SC.

(a) Regulated Area. All waters of the Atlantic Intracoastal Waterway encompassed by a line connecting the following points: point 1 in position 33°39′13″ N., 079°05′36″ W.; thence west to point 2 in position 33°39′17″ N., 079°05′46″ W.; thence south to point 3 in position 33°38′53″ N., 079°05′39″ W.; thence east to point 4 in position 33°38′54″ N., 079°05′31″ W.; thence north back to point 1. All coordinates are North American Datum 1983.

(b) Definition. As used in this section, “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, except persons and vessels participating in Bucksport/Lake Murray Drag Boat Fall Nationals or serving as safety vessels. Persons and vessels desiring to enter, transit through, anchor in, 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, anchor in, 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.

(2) The Coast Guard will provide notice of the regulated area by Marine Safety Information Bulletins, Local Notice to Mariners, Broadcast Notice to Mariners, and on-scene designated representatives.

(d) Enforcement period. This rule will be enforced daily from 1 p.m. until 7 p.m. on September 10 and September 11, 2016.

Dated: August 23, 2016. B.D. Falk, Commander, U.S. Coast Guard. Acting Captain of the Port Charleston.
[FR Doc. 2016-20716 Filed 8-29-16; 8:45 am] BILLING CODE 9110-04-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket No. USCG-2016-0754] Safety Zone; Delaware River, Philadelphia, PA AGENCY:

Coast Guard, DHS.

ACTION:

Notice of enforcement of regulation.

SUMMARY:

The Coast Guard will enforce regulations for a safety zone for an annual fireworks event in the Captain of the Port Delaware Bay zone from 8 p.m. to 10 p.m. on September 16, 2016, with a rain date of September 18, 2016. Enforcement of this zone is necessary and intended to ensure safety of life on the navigable waters immediately prior to, during, and immediately after these fireworks events. During the enforcement periods, no vessel may transit this regulated area without approval from the Captain of the Port or a designated representative.

DATES:

The regulations in 33 CFR 165.506 will be enforced from 8 p.m. through 10 p.m. on September 16, 2016, with a rain date of September 18, 2016, for the safety zone identified in row (a)(16) of Table to § 165.506.

FOR FURTHER INFORMATION CONTACT:

If you have questions about this notice of enforcement, call or email MST1 Thomas Simkins, Sector Delaware Bay Waterways Management Division, U.S. Coast Guard; telephone 215-271-4889, email [email protected]

SUPPLEMENTARY INFORMATION:

From 8 p.m. to 10 p.m. on September 16, 2016, with a rain date of September 18, 2016, the Coast Guard will enforce regulations in 33 CFR 165.506 for the safety zone in the Delaware River in Philadelphia, PA listed in row (a)(16) in the table in that section. This action is being taken to provide for the safety of life on navigable waterways during the fireworks display.

Our regulations for recurring firework events in Captain of the Port Delaware Bay Zone, appear in § 165.506, Safety Zones; Fireworks Displays in the Fifth Coast Guard District, which specifies the location of the regulated area for this safety zone as all waters of Delaware River, adjacent to Penns Landing, Philadelphia, PA, bounded from shoreline to shoreline, bounded on the south by a line running east to west from points along the shoreline at latitude 39°56′31.2″ N., longitude 075°08′28.1″ W.; thence to latitude 39°56′29″.1 N., longitude 075°07′56.5″ W., and bounded on the north by the Benjamin Franklin Bridge.

As specified in §  165.506, during the enforcement period no vessel may transit this safety zone without approval from the Captain of the Port Delaware Bay (COTP). If permission is granted, all persons and vessels shall comply with the instructions of the COTP or designated representative.

This notice of enforcement is issued under authority of 33 CFR 165.506 and 5 U.S.C. 552(a). In addition to this notice of enforcement in the Federal Register, the Coast Guard will provide the maritime community with advanced notification of this enforcement period via Broadcast Notice to Mariners (BNM). If the COTP Delaware Bay determines that the regulated area need not be enforced for the full duration, a BNM to grant general permission to enter the safety zone may be used.

Dated: August 24, 2016. Benjamin A. Cooper, Captain, U.S. Coast Guard, Captain of the Port Delaware Bay.
[FR Doc. 2016-20774 Filed 8-29-16; 8:45 am] BILLING CODE 9110-04-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0371] RIN 1625-AA00 Safety Zone; Chesapeake Bay, Hampton, VA AGENCY:

Coast Guard, DHS.

ACTION:

Temporary final rule.

SUMMARY:

The Coast Guard is establishing a temporary safety zone for navigable waters east of Ft. Monroe located in Hampton, VA, on the Chesapeake Bay. The safety zone is needed to protect personnel, vessels, and the marine environment from potential hazards associated with military exercises involving high-speed, quick maneuvering vessels. Entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port Hampton Roads.

DATES:

This rule is effective from 7 a.m. on September 7, 2016, through 6 p.m. on October 7, 2016.

ADDRESSES:

To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0371 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 LCDR Barbara Wilk, Waterways Management Division Chief, Sector Hampton Roads, U.S. Coast Guard; telephone 757-668-5580, 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 information about the military exercises beginning on September 7, 2016, was not received by the Coast Guard with sufficient time making it impracticable to publish a final rule less than 30 days after the publication in the Federal Register while also allowing for an opportunity to comment on a proposed rule. The Coast Guard will provide advance notifications to users of the affected waterway via marine information broadcasts and local notice to mariners.

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. The restriction on vessel traffic is necessary to protect life, property and the environment, for the duration of the military exercise due to the high speeds of the vessels involved. Therefore, due to the need to have a rule effective by September 7, 2016, a 30-day, delayed-effective-date is impracticable. Delaying the effective date would be contrary to the safety zone's intended objectives, immediate action is needed to protect persons and vessels, and enhance public and maritime safety.

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 Hampton Roads (COTP) has determined that potential hazards associated with the military exercises starting on September 7, 2016, will be a safety concern for anyone within described coordinates of the U.S. Navy exercises. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone from hazards to mariners associated with the exercises include high speed maneuvering vessels.

IV. Discussion of the Rule

This rule establishes a safety zone from 7 a.m. Wednesday, September 7, 2016, through 6 p.m. Friday, October 7, 2016. The safety zone will encompass all navigable waters within an area enclosed by a line connecting the following points latitude 37°07′06″ N., longitude 076°13′12″ W., thence east to 37°05′18″ N., longitude 076°06′54″ W., thence southeast to 37°04′30″ N., longitude 076°06′30″ W., thence south to 36°59′24″.4 N., longitude 076°08′30″ W., thence west to 37°01′18″ N., longitude 076°15′36″ W., thence to the point or origin on the Chesapeake Bay located just northeast of Ft. Monroe in Hampton, VA. The duration of the zone is intended to protect personnel, vessels, and the marine environment in these navigable waters during military exercises. 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 order 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, duration, and time-of-year of the safety zone. Vessel traffic will be able to safely transit around this safety zone which will impact the designated area of the Chesapeake Bay in Hampton, VA for 31 days. Moreover, the Coast Guard will issue Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zone and the rule allows 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 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 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 a safety zone lasting 31 days that will prohibit entry within five nautical miles of vessels involved in the military exercises located just northeast of Ft. Monroe in Hampton, VA. 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

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

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

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

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

2. Add § 165.T05-0371 to read as follows:
§ 165.T05-0371 Safety Zone, Chesapeake Bay; Hampton, VA.

(a) Definitions. For the purposes of this section—

Captain of the Port means the Commander, Sector Hampton Roads.

“Representative” means any Coast Guard commissioned, warrant or petty officer who has been authorized to act on the behalf of the Captain of the Port.

Participants means individuals and vessels involved in the military exercises.

(b) Location. The following area is a safety zone: All waters in the vicinity of Ft. Monroe, on the Chesapeake Bay, bound by a line drawn from latitude 37°07′06″ N., longitude 076°13′12″ W., thence east to 37°05′18″ N., longitude 076°06′54″ W., thence southeast to 37°04′30″ N., longitude 076°06′30″ W., thence south to 36°59′24″.4 N., longitude 076°08′30″ W., thence west to 37°01′18″ N., longitude 076°15′36″ W., thence to the point or origin. (NAD 1983).

(c) Regulations. (1) The general regulations governing safety zones in § 165.23 apply to the area described in paragraph (b) of this section.

(2) With the exception of participants, entry into or remaining in this safety zone is prohibited unless authorized by the Captain of the Port, Hampton Roads or his designated representatives.

(3) All vessels within this safety zone when this section becomes effective must depart the zone immediately.

(4) The Captain of the Port, Hampton Roads or his representative can be contacted at telephone number 757-668-5555.

(5) The Coast Guard and designated security vessels enforcing the safety zone can be contacted on VHF-FM marine band radio channel 13 (165.65 Mhz) and channel 16 (156.8 Mhz).

(6) This section applies to all persons or vessels except participants and vessels that are engaged in the following operations: enforcing laws; servicing aids to navigation, and emergency response vessels.

(d) Enforcement. The U.S. Coast Guard may be assisted in the patrol and enforcement of the safety zone by Federal, State, and local agencies.

(e) Enforcement period. This section will be enforced from 7 a.m. on September 7, 2016, through 6 p.m. on October 7, 2016.

Dated: July 28, 2016. Richard J. Wester, Captain, U.S. Coast Guard, Captain of the Port Hampton Roads.
[FR Doc. 2016-20855 Filed 8-29-16; 8:45 am] BILLING CODE 9110-04-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0824] RIN 1625-AA00 Safety Zone; Dredging, Shark River, NJ AGENCY:

Coast Guard, DHS.

ACTION:

Temporary final rule.

SUMMARY:

The Coast Guard is establishing a temporary safety zone on a portion of Shark River, in Neptune City, NJ, from September 1, 2016, through September 30, 2016, while dredging operations are being conducted in the main navigational channel. This safety zone is necessary to provide for the safety of life on navigable waters during dredging operations and will restrict vessel traffic from transiting the main navigational channel.

DATES:

This rule is effective from September 1, 2016, through September 30, 2016. During this period, it will only be enforced during the following weekly hours, from 9 a.m. on Mondays through 9 p.m. on Thursdays, with the exception of Labor Day weekend, 6 a.m. Friday September 2, 2016 through 12 p.m. Tuesday September 6, 2016.

ADDRESSES:

To view documents mentioned in this preamble as being available in the docket, go to, type USCG-2016-0824 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 Marine Science Technician First Class Tom Simkins, U.S. Coast Guard, Sector Delaware Bay, Waterways Management Division, Coast Guard; telephone (215) 271-4889, 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 COTP Captain of the Port II. Background Information and Regulatory History

Efforts to dredge the Shark River have been underway for well over a decade. After Superstorm Sandy the need to dredge the river increased significantly due to sediment deposited by the storm, which impeded navigation within those channels. Funding issues and concerns over dewatering locations (locations to dry the dredged materials) have historically stalled the progress of this project.

Mobile Dredging and Pumping Co. has been awarded the contract to restore the state channels to allow safe passage for recreational and commercial traffic. The project requires dredging approximately 102,000 cubic yards of sediment comprised of sand and silt. The sediment will be hydraulically dredged and piped via a secure welded pipeline to the selected dewatering locations.

The purpose of this rule is to promote maritime safety and protect vessels from the hazards of dredge piping and dredge operations. The rule will temporarily restrict vessel traffic from transiting a portion of the Shark River while dredging operations are being conducted in the main navigational channel.

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 final details for this event were not received by the Coast Guard until August 17, 2016, and the dredging operation will begin September 1, 2016. The safety zone is needed by September 1, 2016, to ensure safe navigation of the vessels transiting the Shark River, and it is impracticable to publish an NPRM and consider comments before that date. The dredge and dredge piping must be positioned in the main navigational channel in order for the dredging company to complete the proper dredging of the main navigational channel. Allowing this event to go forward without a safety zone in place would expose mariners and the public to unnecessary dangers associated with dredge piping and dredge operations. Therefore, it is imperative that there is a safety zone restricting traffic in this portion of the Shark River, in Neptune City, NJ.

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 for the reasons we stated for not publishing an NPRM. The Coast Guard expects that there will be an impact to vessel traffic during times when the navigational channel is restricted. However, there will be times throughout the project where vessel traffic is not restricted and traffic will be able to freely flow through the main navigational channel. Furthermore, notification of the waterway restrictions will be made by the contractor, Mobile Dredging and Pumping Co. Additionally the New Jersey Department of Transportation, Office of Marine Resources, will be conducting outreach to the local community. Notification of the safety zone and waterway restrictions will be made by the COTP via marine safety broadcast using VHF-FM channel 16 and through the Local Notice to Mariners.

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, Delaware Bay has determined that potential hazards are associated with dredge piping and dredge operations from September 1, 2016, through September 30, 2016. The rule is necessary to promote maritime safety and protect vessels from the hazards of dredge piping and dredge operations.

The rule will have an impact to vessels transiting through the Shark River main navigational channel, from latitude 40°10′53.2579″ N., longitude 074°01′52.6231″ W. channel, north, to latitude 40°11′21.0139″ N., longitude 074°01′53.1749″ W. as vessels will be unable to transit the main navigational channel during times when dredging operations are being conducted. This restriction is necessary to ensure the safety of life and protect vessel from dredge piping and dredge operations.

IV. Discussion of the Rule

On September 1, 2016, dredging will begin on a portion of the Shark River in Neptune City, NJ. The Captain of the Port, Delaware Bay, has determined that the hazards associated with dredge piping and dredge operations in the main navigational channel create the need for a safety zone to ensure safety of vessels transiting this portion and for workers engaged in dredge piping and dredging operations of the Shark River.

The safety zone will close the main navigational channel on all the navigable waters on the Shark River from latitude 40°10′53.2579″ N., longitude 074°01′52.6231″ W., bounded by the eastern side of the channel and the western side of the channel, north, to latitude 40°11′21.0139″ N., longitude 074°01′53.1749″ W.; during times of dredging. Dredging for the main navigational channel is scheduled from September 1, 2016, through September 30, 2016, only from 9 a.m. on Mondays through 9 p.m. on Thursdays, with the exception of Labor Day weekend, 6 a.m. Friday September 2, 2016 through 12 p.m. Tuesday September 6, 2016. Entry into, transiting, or anchoring within this portion of Shark River during these times is prohibited. These coordinates are based on the World Geodetic System 1984 (WGS 84) horizontal datum reference.

The channel will be open from September 1, 2016, through September 30, 2016, from 9 p.m. on Thursdays to 9 a.m. on Mondays, as well as Labor Day weekend, 6 a.m. Friday September 2, 2016 through 12 p.m. Tuesday September 6, 2016. Vessels may transit freely during these times, and vessels are requested to contact the dredge via VHF-FM channel 13 or 16 to make satisfactory passing arrangement and maintain a safe speed when transiting the main navigational channel.

V. Regulatory Analyses

We developed this rule after considering numerous statutes and Executive order 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 finding is based on the limited size of the zone and duration of the safety zone. Although the main navigational channel of this portion of the Shark River will be closed for periods of time throughout the dredging operation, there are designated times where the channel will be open for vessel traffic and traffic will be able to flow freely. Vessels will only be affected 84-hours weekly, from 9 a.m. on Mondays through 9 p.m. on Thursdays, during the month of September in 2016. The safety zone and channel closure will be well publicized to allow mariners to make alternative plans for transiting the affected area.

B. Impact on Small Entities

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

It is expected that there will be some disruption to the maritime community. Before the effective period, the Coast Guard, Mobile Dredging and Pumping Co., and New Jersey Department of Transportation's Office of Marine Resources will issue maritime advisories, widely available to users of the Shark River, describing times and dates of waterway closures and openings.

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 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 a safety zone encompassing all the waters from latitude 40°10′53.2579″ N., longitude 074°01′52.6231″ W., bounded by the eastern side of the channel and the western side of the channel, north, to latitude 40°11′21.0139″ N., longitude 074°01′53.1749″ W., in the Shark River, in Neptune City, NJ. 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

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

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

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

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

2. Add temporary § 165.T05-0824 to read as follows:
§ 165.T05-0824 Safety Zone, Dredging; Shark River, NJ.

(a) Regulated areas. The following areas are safety zone: All waters from latitude 40°10′53.2579″ N., longitude 074°01′52.6231″ W., bounded by the eastern side of the channel and the western side of the channel, north, to latitude 40°11′21.0139″ N., longitude 074°01′53.1749″ W., in the Shark River, in Neptune City, NJ. These coordinates are based on the World Geodetic System 1984 (WGS 84) horizontal datum reference.

(b) Regulations. The general safety zone regulations in § 165.23 apply to the safety zone created by this section.

(1) All vessels and persons are prohibited from entering into or moving within the safety zone described in paragraph (a) of this section while it is subject to enforcement, unless authorized by the Captain of the Port, Delaware Bay, or by his designated representative.

(2) Persons or vessels seeking to enter or pass through the safety zone must contact the Captain of the Port, Delaware Bay, or his designated representative to seek permission to transit the area. The Captain of the Port, Delaware Bay can be contacted at telephone number 215-271-4807 or on Marine Band Radio VHF Channel 16 (156.8 MHz).

(3) Vessels may freely transit this portion of the Shark River from September 1, 2016, through September 30, 2016, weekly, from 9 p.m. on Thursdays through 9 a.m. on Mondays, as well as Labor Day weekend, 6 a.m. Friday September 2, 2016 through 12 p.m. Tuesday September 6, 2016. Vessels are requested to contact the dredge via VHF-FM channel 13 or 16 to make satisfactory passing arrangement and maintain a safe speed when transiting the main navigational channel during times of channel openings.

(4) This section applies to all vessels except those engaged in the following operations: enforcing laws, servicing aids to navigation and emergency response vessels.

(c) Definitions. As used in this section:

Captain of the Port Delaware Bay means the Commander, U.S. Coast Guard Sector Delaware Bay, Philadelphia, PA.

Designated representative means any Coast Guard commissioned, warrant, or petty officer who has been authorized by the Captain of the Port Delaware Bay to assist in enforcing the safety zone described in paragraph (a) of this section.

(d) Enforcement. The U.S. Coast Guard may be assisted by Federal, State and local agencies in the patrol and enforcement of the zone.

(e) Enforcement periods. This section will be enforced weekly, from 9 a.m. on Mondays through 9 p.m. on Thursdays, from September 1, 2016, through September 30, 2016, with the exception of Labor Day weekend, 6 a.m. Friday September 2, 2016 through 12 p.m. Tuesday September 6, 2016, unless cancelled earlier by the Captain of the Port.

Dated: August 25, 2016. Benjamin A. Cooper, Captain, U.S. Coast Guard, Captain of the Port Delaware Bay.
[FR Doc. 2016-20820 Filed 8-29-16; 8:45 am] BILLING CODE 9110-04-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0832] RIN 1625-AA00 Safety Zone; Caribbean Fantasy, Vessel on Fire; Punta Salinas, Toa Baja, Puerto Rico AGENCY:

Coast Guard, DHS.

ACTION:

Temporary final rule.

SUMMARY:

The Coast Guard is establishing a temporary safety zone of 1,000 yards radius for the Cruise Ship Caribbean Fantasy due to an imminent fire on board, in the vicinity of Punta Salinas, Toa Baja, Puerto Rico. The safety zone is needed to protect personnel, vessels, and the marine environment from potential hazards associated with the fire on board the vessel. Entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port San Juan.

DATES:

This rule is effective without actual notice from August 30, 2016 until 11:59 p.m. on August 31, 2016. For purposes of enforcement, actual notice will be used from 3 p.m. on August 17, 2016 through August 30, 2016.

ADDRESSES:

To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0832 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 Mr. Efrain Lopez, Sector San Juan Prevention Department, Coast Guard; telephone (787) 289-2097, 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 of the immediate actions needed to respond to the emergency and potential safety hazards associated with the fire on board the Caribbean Fantasy. It is impracticable to publish an NPRM because we must establish this safety zone immediately, on August 17, 2016.

We are issuing this rule, and under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making it effective less than 30 days after publication in the Federal Register. Delaying the effective date of this rule would be contrary to public interest because immediate action is needed to respond to the emergency and potential safety hazards associated with the fire on board the Caribbean Fantasy.

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 San Juan (COTP) has determined that potential hazards associated with fire will be a safety concern for anyone within a 1000-yard radius the Caribbean Fantasy. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone.

IV. Discussion of the Rule

This rule establishes a safety zone from 3 p.m. on August 17, 2016 until 11:59 p.m. on August 31, 2016. The safety zone will cover all navigable waters within 1000 yards of the vessel Caribbean Fantasy. The duration of the zone is intended to protect personnel, vessels, and the marine environment in these navigable waters while the passenger gets rescued and the fire gets suppressed. 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.

The safety zone listed in this rule will restrict vessel traffic from entering, transiting in or operating on the waters within this zone. The effect of this regulation will not be significant for several reasons: (1) this rule will only affect vessel traffic for a short duration; (2) vessels may request permission from the COTP to transit through the safety zone; and (3) the impacts on routine navigation are expected to be minimal. Notifications to the marine community will be made through Broadcast Notice to Mariners via VHF-FM marine channel 16 and on-scene representatives. These notifications will allow the public to plan operations around the affected 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 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 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 a safety zone that will prohibit entry within 1000 yards of the Caribbean Fantasy due to an imminent fire on board. 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 a temporary § 165.T07-0832 to read as follows:
§ 165.T07-0832 Safety Zone; Caribbean Fantasy, Vessel on Fire; Punta Salinas, Toa Baja, Puerto Rico.

(a) Regulated area. The following area is a safety zone: all waters within 1,000 yard radius from the Caribbean Fantasy, located in Punta Salinas, Toa Baja, Puerto Rico.

(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 Jacksonville in the enforcement of the regulated area.

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

(2) Persons or vessels desiring enter into, pass through, or operate on the waters within this zone, must request permission from the Captain of the Port San Juan or a designated representative. They may be contacted on VHF-FM Channel 16 or by telephone at (787) 289-2041.

(3) If permission is granted, all persons and vessels shall comply with any specific instructions of the Captain of the Port San Juan or designated representative, while transiting through the zone.

(d) Informational broadcasts. The Coast Guard will provide notice of the regulated area by Broadcast Notices to Mariners and on-scene designated representatives.

(e) Enforcement period. This safety zone will be enforced from 3 p.m. on August 17, 2016 through 11:59 p.m. on August 31, 2016.

Dated: August 17, 2016. R.W. Warren, Captain, U.S. Coast Guard, Captain of the Port San Juan.
[FR Doc. 2016-20856 Filed 8-29-16; 8:45 am] BILLING CODE 9110-04-P
ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2016-0054; FRL-9951-22-Region 3] Approval and Promulgation of Air Quality Implementation Plans; Maryland; Control of Emissions From Various Processes and Fuel-Burning Equipment From Kraft Pulp Mills AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule.

SUMMARY:

The Environmental Protection Agency (EPA) is granting conditional approval of a state implementation plan (SIP) revision submitted by the Maryland Department of the Environment (MDE). The revisions adds and amends regulations in the SIP which control emissions from various processes and fuel-burning equipment at Kraft pulp mills. The SIP revision includes the following: a new definition for “NOX Ozone Season Allowance;” a new regulation with nitrogen oxides (NOX) limits for fuel-burning equipment located at Kraft pulp mills; a removal and relocation of existing NOX reasonably available control technology (RACT) requirements for Kraft pulp mills into another Maryland regulation; and a revised regulation which clarifies the volatile organic compound (VOC) control system and emission requirements for several process installations at Kraft pulp mills. EPA is granting conditional approval because the new Maryland definition references the defunct Clean Air Interstate Rule (CAIR) and because MDE provided a commitment to remove all references to CAIR within the definition of “NOX Ozone Season Allowance” and submit a revised definition as a new SIP revision, no later than a year from EPA finalizing this conditional approval. Upon timely meeting of this commitment, EPA will propose to convert the conditional approval of the SIP revision to a final, full approval. This action is being taken under the Clean Air Act (CAA).

DATES:

This final rule is effective on September 29, 2016.

ADDRESSES:

EPA has established a docket for this action under Docket ID No. EPA-R03-OAR-2016-0054. All documents in the docket are listed on the http://www.regulations.gov Web site. Although listed in the index, some information is not publicly available, e.g., confidential business information (CBI) or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available through http://www.regulations.gov, or please contact the person identified in the FOR FURTHER INFORMATION CONTACT section for additional availability information.

FOR FURTHER INFORMATION CONTACT:

Gregory Becoat, (215) 814 2036, or by email at [email protected]

SUPPLEMENTARY INFORMATION:

I. Background

On May 20, 2016 (81 FR 31887), EPA published a notice of proposed rulemaking (NPR) for the State of Maryland. In the NPR, EPA proposed to grant conditional approval of revisions to regulations in Maryland's SIP which control emissions from various processes and fuel-burning equipment at Kraft pulp mills. The formal SIP revision (14-04) was submitted by MDE on October 15, 2014.

II. Summary of SIP Revision

MDE's SIP revision adds and amends regulations in order to control emissions from various processes and fuel-burning equipment at Kraft pulp mills. The SIP revision adds a definition for “NOX Ozone Season Allowance” and establishes applicability, compliance requirements, monitoring and reporting requirements, allowances, and NOX emission standards and limits for Kraft pulp mills. The SIP revision also removes subsection (C)(h) of the Code of Maryland Regulations (COMAR) 26.11.09.08 from the Maryland SIP because the NOX requirements for pulp mills have been relocated to COMAR 26.11.14.07. The SIP revision clarifies the VOC control system and requirements for several process installations at Kraft pulp mills.

Other specific requirements of the SIP revision and the rationale for EPA's action to grant conditional approval are explained in the NPR and will not be restated here. No public comments were received on the NPR.

III. Final Action

EPA is granting conditional approval of Maryland's October 15, 2014 SIP revision concerning the regulations and requirements to control NOX and VOC emissions from various processes and fuel-burning equipment at Kraft pulp mills as it strengthens the SIP with provisions related to controlling emissions of NOX and VOC. The conditional approval is contingent upon MDE's September 29, 2015 commitment to remove references to the now defunct CAIR CAA allowance trading program within the definition of “NOX Ozone Season Allowance,” at COMAR 26.11.01.01 and replace with another allowance mechanism. Once EPA has determined that MDE has satisfied this condition and EPA approves the revised definition, EPA shall remove the conditional nature of its approval and this SIP revision will at that time receive full approval status.

IV. Incorporation by Reference

In this rule, with our conditional approval, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing, with our conditional approval, the incorporation by reference of revisions to COMAR 26.11.01.01, COMAR 26.11.14.07, COMAR 26.11.09.08, and COMAR 26.11.14.06. Therefore, these materials have been conditionally approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.1 EPA has made, and will continue to make, these materials generally available through http://www.regulations.gov and/or at the EPA Region III Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

1 62 FR 27968 (May 22, 1997).

V. Statutory and Executive Order Reviews A. General Requirements

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

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

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

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

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

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

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

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

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

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

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

B. Submission to Congress and the Comptroller General

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

C. Petitions for Judicial Review

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 31, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action.

This action pertaining to the regulations and requirements for the control of emissions from various processes and fuel-burning equipment from Kraft pulp mills, may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

List of Subjects in 40 CFR Part 52

Environmental protection, Air pollution control, Incorporation by reference, Nitrogen dioxide, Ozone, Reporting and recordkeeping requirements, Volatile organic compounds.

Dated: August 12, 2016. Shawn M. Garvin, Regional Administrator, Region III.

40 CFR part 52 is amended as follows:

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

42 U.S.C. 7401 et seq.

Subpart V—Maryland 2. In § 52.1070, paragraph (c) table is amended by revising the entries for “26.11.01.01”, “26.11.09.08”, “26.11.14.06”, and adding in numerical order the entry for “26.11.14.07”to read as follows:
§ 52.1070 Identification of plan.

(c)* * *

EPA-Approved Regulations, Technical Memoranda, and Statutes in the Maryland SIP Code of Maryland Administrative Regulations (COMAR) citation Title/subject State
  • effective
  • date
  • EPA Approval date Additional explanation/citation at 40 CFR 52.1100
    26.11.01 General Administrative Provisions 26.11.01.01 Definitions 03/03/14 08/30/16 Revised definition of “NOX Ozone Season Allowance” and Conditional Approval of definition of “NOX Ozone Season Allowance”. *         *         *         *         *         *         * 26.11.09 Control of Fuel Burning Equipment, Stationary Internal Combustion Engines, and Certain Fuel-Burning Installations *         *         *         *         *         *         * 26.11.09.08 Control of NOX Emissions for Major Stationary Sources 03/03/14 08/30/16 [Insert Federal Register citation] Removed and relocated existing NOX RACT requirements under COMAR 26.11.14.07. Conditional Approval. *         *         *         *         *         *         * 26.11.14 Control of Emissions From Kraft Pulp Mills *         *         *         *         *         *         * 26.11.14.06. Control of Volatile Organic Compounds 03/03/14 08/30/16 [Insert Federal Register citation] Amended to clarify volatile organic compound (VOC) control system and requirements at Kraft pulp mills. Conditional Approval. 26.11.14.07. Control of NOX Emissions from Fuel Burning Equipment 03/03/14 08/30/16 [Insert Federal Register citation] Regulation Added. Conditional Approval. *         *         *         *         *         *         *
    [FR Doc. 2016-20654 Filed 8-29-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R04-OAR-2015-0675; FRL-9951-59-Region 4] Air Plan Approval; Kentucky; Source Specific Revision for Louisville Gas and Electric AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving a State Implementation Plan (SIP) revision submitted by the Commonwealth of Kentucky through its Energy and Environment Cabinet, Department of Environmental Protection, Division for Air Quality (KY DAQ) on February 13, 2013, for the purpose of establishing emission requirements for the changeover from coal-fired units U4, U5 and U6 to a new natural gas-fired combined cycle (NGCC) generating unit U15 and auxiliary boiler U16 at the Louisville Gas and Electric Company, Cane Run Generating Station (LG & E Cane Run Facility).

    DATES:

    This rule will be effective September 29, 2016.

    ADDRESSES:

    EPA has established a docket for this action under Docket Identification No. EPA-R04-OAR-2015-0675. All documents in the docket are listed on the www.regulations.gov Web site. Although listed in the index, some information may not be publicly available, i.e., Confidential Business Information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically through www.regulations.gov or in hard copy at the Air Regulatory Management Section, Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official hours of business are Monday through Friday 8:30 a.m. to 4:30 p.m., excluding Federal holidays.

    FOR FURTHER INFORMATION CONTACT:

    Jane Spann of the Air Regulatory Management Section, Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street, SW., Atlanta, Georgia 30303-8960. Ms. Spann may be reached by telephone at (404) 562-9029 or via electronic mail at [email protected]

    SUPPLEMENTARY INFORMATION: I. Background

    Ozone is created when chemical reactions between volatile organic compounds (VOC) and nitrogen oxides (NOX) occur in the presence of sunlight. Ozone is reduced by reducing VOC and NOX emissions. The Louisville Metro Air Pollution Control District (LMAPCD) adopted regulation 6.42 Reasonably Available Control Technology Requirements for Major Volatile Organic Compound and Nitrogen Oxides Emitting Facilities on February 2, 1994. LMAPCD's regulation 6.42 was submitted to EPA, through the Commonwealth of Kentucky, on May 21, 1999. On October 23, 2001, EPA approved LMAPCD's regulation 6.42, section 4.4 of which requires LMAPCD to submit each source-specific reasonably available control technology (RACT) determination to EPA for approval into the Kentucky SIP. See 66 FR 53658. On the same date, EPA approved the NOX RACT plan for LG & E's Cane Run Facility into the SIP. See 66 FR 53684.

    On June 13, 2011, LG & E submitted to the Air Pollution Control Board of Jefferson County (Board) an application for a permit to construct a new NGCC generating unit U15 and auxiliary boiler U16 and retire coal-fired units U4, U5 and U6 at LG & E's Cane Run Facility to comply with other federal requirements, including the Mercury & Air Toxics Standards and the Cross-State Air Pollution Rule.1 In response, on July 18, 2012, the Board adopted Amendment 2 establishing NOX emission rates for the new units. On February 13, 2013, KY DAQ, on behalf of LMAPCD, submitted a SIP revision for EPA to approve the LG & E Cane Run Generating Station NOX RACT Plan Amendment 2 into the Kentucky SIP. The LG & E Cane Run Generating Station NOX RACT Plan Amendment 2 includes two parts: Part 1, the existing NOX RACT Plan for the coal-fired units, which will remain in effect until those units are retired; and Part 2, the plan that will become effective upon the start of operation of the NGCC facility and the shut-down of the coal-fired units.

    1 Amendment 2 of the February 13, 2013, submittal includes a Dew Point Heater (U17). In 2014, LG&E notified LMAPCD that LG&E is not installing U17 after all.

    In a notice of proposed rulemaking (NPRM) published on June 15, 2016 (81 FR 39002), EPA proposed to approve Kentucky's February 13, 2013, submission, for the purpose of establishing emission requirements for the changeover from coal-fired units U4, U5 and U6 to a new NGCC generating unit U15 and auxiliary boiler U16 at the LG & E Cane Run Facility. No comments were received on the June 15, 2016, proposed rulemaking. The details of Kentucky's submittal and the rationale for EPA's actions are further explained in the NPRM. See 81 FR 39002 (June 15, 2016).

    II. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of KY DAQ source-specific provision entitled “Air Pollution Control Board of Jefferson County Board Order—Amendment 2,” approved by LMAPCD on July 18, 2012. Therefore, this material has been approved by EPA for inclusion in the SIP, has been incorporated by reference by EPA into that plan, is fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.2 EPA has made, and will continue to make, these materials generally available through www.regulations.gov and/or at the EPA Region 4 Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information)

    2 62 FR 27968 (May 22, 1997).

    III. Final Action

    EPA is taking final action to approve the February 13, 2013, Kentucky SIP revision which adds LG & E Cane Run Generating Station NOX RACT Plan Amendment 2 to the federally-approved Kentucky SIP. This SIP revision includes emission requirements for the changeover from coal-fired units to natural gas-fired combined cycle EGUs and associated equipment.

    IV. Statutory and Executive Order Reviews

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

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

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

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

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

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

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

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

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

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

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

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

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 31, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. See section 307(b)(2).

    List of Subjects in 40 CFR Part 52

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

    Dated: August 17, 2016. Heather McTeer Toney, Regional Administrator, Region 4.

    40 CFR part 52 is amended as follows:

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

    42 U.S.C. 7401 et seq.

    Subpart S—Kentucky 2. Section 52.920(d) is amended by adding a new entry “LG & E Cane Run Generating Station NOX RACT Plan Amendment 2” at the end of the table to read as follows:
    § 52.920 Identification of plan.

    (d) * * *

    EPA-Approved Kentucky Source-Specific Requirements Name of source Permit No. State
  • effective
  • date
  • EPA approval date Explanations
    *         *         *         *         *         *         * LG & E Cane Run Generating Station NOX RACT Plan Amendment 2 N/A 7/18/2012 8/30/2016, [Insert citation of publication]
    [FR Doc. 2016-20656 Filed 8-29-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R09-OAR-2016-0096; FRL-9951-48-Region 9] Air Plan Approval; Reno, Nevada; Second 10-Year Carbon Monoxide Maintenance Plan AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Direct final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is taking direct final action to approve a State Implementation Plan (SIP) revision submitted by the State of Nevada. On July 3, 2008, the EPA redesignated the Truckee Meadows area, consisting largely of the cities of Reno and Sparks in Washoe County, Nevada, from nonattainment to attainment for the carbon monoxide (CO) National Ambient Air Quality Standards (NAAQS) and approved the State's plan addressing the area's maintenance of the NAAQS for ten years. On November 7, 2014, the State of Nevada submitted to the EPA a second maintenance plan for the Truckee Meadows area that addressed maintenance of the NAAQS through 2030. The EPA is now approving this second maintenance plan. The EPA is also finding adequate and approving transportation conformity motor vehicle emissions budgets (MVEBs) for the years 2015, 2020, 2025 and 2030. We are taking these actions under the Clean Air Act (CAA or “the Act”).

    DATES:

    This rule is effective on October 31, 2016 without further notice, unless the EPA receives adverse comments by September 29, 2016. If we receive such comments, we will publish a timely withdrawal in the Federal Register to notify the public that this direct final rule will not take effect.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R09-OAR-2016-0096 at http://www.regulations.gov, or via email to John Kelly, Air Planning Office at [email protected] For comments submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be removed or edited from Regulations.gov. For either manner of submission, the EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission (i.e., on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the FOR FURTHER INFORMATION CONTACT section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    John Kelly, EPA Region IX, (415) 947-4151, [email protected]

    SUPPLEMENTARY INFORMATION:

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

    Table of Contents I. Background A. Truckee Meadows Attainment Status B. 2014 Maintenance Plan C. Transportation Conformity II. The EPA's Evaluation of Nevada's Submittal A. Ambient Air Quality Monitoring Data B. Attainment Inventory C. Maintenance Demonstration D. Transportation Conformity E. Ambient Air Quality Monitoring Network F. Verification of Continued Attainment G. Contingency Plan III. Public Comment and Final Action IV. Statutory and Executive Order Reviews I. Background A. Truckee Meadows Attainment Status

    Under the CAA Amendments of 1990, the Truckee Meadows area (hereinafter referred to as Truckee Meadows, the Truckee Meadows area or the area), which includes the Reno-Sparks metropolitan area in Washoe County, Nevada, was designated and classified as a moderate CO nonattainment area.1

    1 For a detailed description of air quality planning in the area, see the EPA's proposal to approve the first 10-year maintenance plan, published in the Federal Register on January 7, 2008, 73 FR 1175 at 1177. The CO attainment table in 40 CFR 81.329 lists the area as “Reno Area: Washoe County (part) Truckee Meadows Hydrographic Area 87.”

    The primary CO NAAQS are attained when ambient concentration design values do not exceed either the 1-hour 35 parts per million (ppm) (or 10 milligrams per cubic meter) standard or the 8-hour 9 ppm (or 40 milligrams per cubic meter) standard more than once per year. See 40 CFR 50.8(a). According to monitoring data going back to 1980 in the EPA's 2 Air Quality System (AQS), Truckee Meadows has not had a violation of the 1-hour CO standard.3 Regarding the 8-hour standard, the area has not had a violation since 1991.4 The EPA determined in 2005 that the area had attained the CO NAAQS by the area's December 31, 1995 attainment deadline. See 70 FR 22803 (May 3, 2005). This determination did not affect the designation of the area as nonattainment or its classification as a moderate area.

    2 The initials EPA, and the words “we,” “us,” or “our” mean or refer to the United States Environmental Protection Agency.

    3See Truckee Meadows 1980-2016 1-Hour CO Violation Day Count Report, data pulled from AQS on August 1, 2016.

    4 2014 Maintenance Plan, page 1. See also, Truckee Meadows 1991-2016 8-Hour CO Violation Day Count Report, data pulled from AQS on August 1, 2016, which verifies the District's assertion in the 2014 Maintenance Plan that there have been no 8-hour CO violations in the Truckee Meadows area since 1991. This report also includes more recent monitoring data (up through the first quarter of 2016) than the 2014 Maintenance Plan.

    On November 4, 2005, the State of Nevada (“State” or “Nevada”) submitted a request to the EPA to redesignate Truckee Meadows from nonattainment to attainment for the CO NAAQS. Along with this request, the State submitted a CAA section 175A(a) maintenance plan, which demonstrated that the area would maintain the CO NAAQS for the first 10 years following our approval of the redesignation request (“2005 Maintenance Plan”). We approved the State's redesignation request and 10-year maintenance plan on April 2, 2008. See 73 FR 38124 (July 3, 2008). For a detailed history of the CO planning efforts in the area up to 2005, please see the EPA's proposal to approve the 2005 Maintenance Plan. See 73 FR 1175 at 1177 (January 7, 2008).

    B. 2014 Maintenance Plan

    Eight years after an area is redesignated to attainment, CAA section 175A(b) requires the State to submit a subsequent maintenance plan to the EPA, covering a second 10-year period.5 The second maintenance plan must demonstrate continued compliance with the NAAQS during this second 10-year period. To fulfill this requirement of the CAA, Nevada submitted the second 10-year update of the Truckee Meadows area CO maintenance plan to the EPA on November 7, 2014. The plan was developed by the Washoe County Health District's (District) Air Quality Management Division (AQMD) and is titled “Second 10-Year Maintenance Plan for the Truckee Meadows 8-Hour Carbon Monoxide Attainment Area, August 28, 2014” (hereinafter, “2014 Maintenance Plan” or “Plan”). The 2014 Maintenance Plan was adopted by the District's Board of Health on August 28, 2014. See Washoe County Board of Health Certificate of Adoption, August 28, 2014. Air quality planning and monitoring in Truckee Meadows is the responsibility of the District, which administers air quality programs in Washoe County through the AQMD. The State Environmental Commission and the Nevada Department of Motor Vehicles are responsible for the motor vehicle inspection and maintenance program in Truckee Meadows.

    5 In this case, the initial maintenance period extends through 2018. Thus, the second 10-year period must extend at least through 2028. The District's demonstration is for maintenance through 2030.

    C. Transportation Conformity

    Section 176(c) of the Act defines conformity as meeting the SIP's purpose of eliminating or reducing the severity and number of violations of the NAAQS and achieving expeditious attainment of such standards. The Act further defines transportation conformity to mean that no Federal transportation activity will: (1) Cause or contribute to any new violation of any standard in any area; (2) increase the frequency or severity of any existing violation of any standard in any area; or (3) delay timely attainment of any standard or any required interim emission reductions or other milestones in any area. The federal transportation conformity rule, 40 CFR part 93 subpart A, sets forth the criteria and procedures for demonstrating and assuring conformity of transportation plans, programs and projects which are developed, funded or approved by the U.S. Department of Transportation, and by metropolitan planning organizations or other recipients of Federal funds under Title 23 U.S.C. or the Federal Transit Laws.

    The transportation conformity rule applies within all nonattainment and maintenance areas. As prescribed by the transportation conformity rule, once an area has an applicable SIP with MVEBs, the expected emissions from planned transportation activities must be consistent with such established budgets for that area.

    II. The EPA's Evaluation of Nevada's Submittal

    The 2014 Maintenance Plan contains the following major sections: (1) An introductory section containing a general discussion of plan approvals and the area's redesignation to attainment; and (2) a maintenance plan section including subsections on the attainment emissions inventory, a maintenance demonstration, MVEBs, the area's monitoring network, verification of continued attainment, and a contingency plan. See 2014 Maintenance Plan, Chapters 1 and 2.

    Following is the EPA's evaluation of the 2014 Maintenance Plan under the CAA, the EPA's implementing regulations and relevant guidance.

    A. Ambient Air Quality Monitoring Data

    As noted above, the primary NAAQS for CO are: 9 ppm (or 10 milligrams per cubic meter) for an 8-hour average concentration not to be exceeded more than once per year and 35 ppm (or 40 milligrams per cubic meter) for a 1-hour average concentration not to be exceeded more than once per year. See 40 CFR 50.8(a).

    The 2014 Maintenance Plan includes a summary of 8-hour CO design values for the years 2008 to 2013. See 2014 Maintenance Plan, Table 1-1, page 2. In addition, the EPA examined monitoring data for Truckee Meadows for the last ten years, including a large portion of the period covered by the first maintenance plan. Table 1 shows the complete, quality assured and certified ambient air monitoring design values for CO in the area for the years 2006 to 2015 and preliminary data for 2016. The first maintenance plan covers the years 2008-2018. The year 2015 is the last year for which we have complete, quality assured and certified ambient air monitoring design values for CO in the area. The monitoring data show that CO design values in the Truckee Meadows area have been well below the level of the NAAQS throughout the last decade.

    6 Design values were derived from AQS. The EPA notes that the 8-hour CO design value given in the 2014 Maintenance Plan for the year 2011 (i.e., 2.9 ppm) appears to be in error and should actually be as shown (i.e., 2.6 ppm). For 1-hour CO design values, see the Truckee Meadows 1-Hour CO 2006-2016 Maximum Values Report, dated August 1, 2016. For 8-hour CO design values, see the Truckee Meadows 8-Hour CO 2006-2016 Maximum Values Report, dated August 1, 2016.

    7 Preliminary design values for 2016 through March 31, 2016. See Truckee Meadows 2016 1-hour Completeness Report, dated August 1, 2016.

    Table 1—CO Design Values for Truckee Meadows, NV, Years 2006-2015 Design Values (ppm) 6 1-Hour 8-Hour Years 4.8 3.3 2006 4.7 3.3 2007 3.9 2.9 2008 4.2 2.6 2009 3.1 2.6 2010 3.4 2.6 2011 2.8 2.3 2012 2.8 2.4 2013 3.2 2.4 2014 2.7 2.0 2015 2.2 1.5 7 2016 B. Attainment Inventory

    Due to the area's status at the time as moderate nonattainment for the CO standards, the District developed a 1990 baseline emissions inventory and has continued to update the inventory pursuant to CAA requirements every three years. The most recent inventory at the time the state submitted the 2014 Maintenance Plan was for the year 2011. The District is using the 2011 emissions inventory, adjusted down due to unusually high wildfire emissions that occurred that year, as the attainment inventory. The District refers to this attainment inventory as the Truckee Meadows maintenance emissions limit. With the level of emissions that occurred in 2011, the area still attained the CO standards. Levels at or below the downward-adjusted 2011 emissions (that is, the Truckee Meadows maintenance emissions limit) are therefore expected to maintain the standards. The unadjusted emissions levels are presented in Table 2. The District then adjusts the nonpoint source category to reflect more representative wildfire emissions, and then uses the adjusted total emissions for the area as the maintenance emissions limit, as explained in section III.C below.

    Table 2—2011 CO Inventory Source category 2011 Inventory
  • (pounds per day)
  • Point 3,361 Nonpoint 154,956 Non-road 50,706 On-road 163,500 Total * 372,522 * Totals may not add up due to rounding.

    The EPA finds that the 2011 inventory information presented by the District is acceptable and consistent with the source category amounts and totals for the 2011 National Emissions Inventory for Washoe County, with one exception. The District's information does not account for railroad (locomotive) emissions. Locomotive emissions would add 3.6 tons per year of CO emissions to the area, or 19.7 pounds per day (lbs/day). Compared to a total inventory of 372,522 lbs/day, however, the omission of railroad emissions amounts to less than 0.01% of the total CO emissions for the area, and the EPA therefore does not believe the omission to be significant.

    C. Maintenance Demonstration

    In general, a state may demonstrate that an area will maintain the NAAQS by showing that future emissions will not exceed the level of the attainment inventory.8 Attainment must be demonstrated for the 10-year period following the first ten years covered by the initial maintenance plan. For the Truckee Meadows area, the first maintenance period ranges from 2008, when the EPA approved the area's redesignation request and maintenance plan, through the year 2018. In the 2014 Maintenance Plan, the District must also demonstrate attainment for the 10-year period following the first ten years. The 2014 Maintenance Plan covers a portion of the first 10-year period (through 2018), as well as the second ten years, 2018 through 2028. In addition, a state may go beyond the minimum requirements of the CAA. The District has elected to make the horizon year for this Plan 2030 for the convenience of transportation planning.

    8See the EPA's September 4, 1992 John Calcagni memorandum entitled “Procedures for Processing Requests to Redesignate Areas to Attainment,” at page 9, available online at: https://www.epa.gov/sites/production/files/2016-03/documents/calcagni_memo_-_procedures_for_processing_requests_to_redesignate_areas_to_attainment_090492.pdf.

    Although the 2005 Maintenance Plan addresses maintenance through the year 2018, the emissions projections of the 2014 Maintenance Plan replace those from the previous plan. The District's rationale is that there are now better planning assumptions and improved emissions calculation methodologies that were not available in developing the previous plan. Updated methodologies include the change from using MOBILE6 mobile source modeling software, used for the 2005 Maintenance Plan, to the MOVES model used for the 2014 Maintenance Plan.

    As noted above, the District used its 2011 periodic emissions inventory 9 to develop the baseline 2011 “maintenance emissions limit” for the Truckee Meadows area, which is then used to compare future emissions inventories for the purpose of verifying continued attainment of the CO NAAQS as long as those future emissions are lower than the maintenance emissions limit.

    9See Washoe County, Nevada: 2011 Periodic Emissions Inventory and Appendices A, B, and C.

    As shown in Table 3, for most emissions categories, the District simply used emission levels from the 2011 periodic emissions inventory to develop its 2011 maintenance emissions limit. However, for wildfires, the District noted that 2011 was an unusually active year for wildfires, with corresponding CO emissions of 105,092 lbs/day. To approximate more typical wildfire emissions for purposes of producing the 2011 Truckee Meadows maintenance emissions limit, the District used the average of wildfire emissions for the four previous inventory years (1999, 2002, 2005, and 2008). That average is 217 lbs/day, which the District used to adjust the nonpoint source category. Due to this adjustment, total nonpoint emissions for the nonpoint source category are 50,081 lbs/day for the maintenance emissions limit, as compared with 154,956 lbs/day in the 2011 emissions inventory, as shown in Table 3. See 2014 Maintenance Plan, Table 2-3.

    Table 3—Truckee Meadows CO Emissions Inventories, in Pounds per Day Source
  • category
  • 2011 Periodic
  • inventory
  • (lbs/day)
  • 2011 Maintenance emissions limit
  • (lbs/day)
  • Point 3,361 3,361 Nonpoint 154,956 50,081 Non-Road Mobile 50,706 50,706 On-Road Mobile 163,500 163,500 Total * 372,522 267,648 * Totals may not add up due to rounding.

    The District supports its use of 267,648 lbs/day maintenance emissions limit as the attainment inventory because it uses the most accurate emissions inventory methodologies, is a current and comprehensive emissions inventory, identifies the level of emissions in the Truckee Meadows area sufficient to maintain the CO standards, and will be the emissions inventory most consistent with the 2030 projected inventory required for demonstrating maintenance of the CO standards. See 2014 CO Maintenance Plan, page 6.

    The District used the following methodologies or models, as described in EPA guidance,11 to project the 2011 maintenance emissions limit (i.e. the 2011 periodic emissions inventory adjusted to exclude unusually high wildfire emissions) out to future milestone years 2015, 2020, 2025 and 2030 for each of the emissions source categories, in order to demonstrate continued maintenance with the CO NAAQS.

    10See “Procedures for Preparing Emissions Projections,” EPA-450/4-91-019, July 1991, available online at https://www.epa.gov/nscep.

    1. Baseline Emissions Projections. Washoe County's 2030 population, employment and vehicle miles travelled (VMT) forecasts (2014 Maintenance Plan, Appendix A) were used as surrogates to project the 2030 emissions, and were consistent with those used by the local metropolitan planning organization.

    2. EPA Models. Non-road and on-road motor vehicle categories accounted for approximately 59% of the 2011 emissions inventory. To ensure consistency throughout the maintenance demonstration period, the same non-road and on-road models were used to estimate the 2030 projected emissions inventory.

    3. Emissions Category Surveys. The District uses surveys to estimate emissions from residential wood combustion (RWC). The District applied an adjustment factor based on heating degree days to the most recent survey (conducted in 2012-2013) to project RWC emissions from 2015 through 2030. See 2014 Maintenance Plan, Appendix A.1

    Table 4 lists the 2011 Truckee Meadows maintenance emissions limit and projected emissions for 2015, 2020, 2025 and 2030 for the four major CO emissions source categories in the area. See 2014 Maintenance Plan, Table 2-4. The District provides a more detailed inventory for 2011 and projected future years in the 2014 Maintenance Plan, Appendix B.

    Table 4—Truckee Meadows CO Maintenance Emissions Inventories (lbs/day) Source category 2011 * 2015 2020 2025 2030 Point 3,361 3,768 4,357 4,974 5,678 Nonpoint 50,081 47,820 45,236 42,845 40,355 Non-Road 50,706 43,725 45,385 48,320 51,656 On-Road 163,500 150,330 140,129 138,938 142,686 Total ** 267,648 245,642 235,107 235,077 240,375 * Truckee Meadows maintenance emissions limit. ** Totals may not add up due to rounding.

    The District projects that population, number of households, employment and VMT will increase through 2030 and beyond, but that federally enforceable CO control programs targeting gasoline-powered motor vehicles, RWC and diesel-powered motor vehicles will help offset this growth. Because future emissions are not projected to exceed the level of the 2011 Truckee Meadows maintenance emissions limit of 267,648 lbs/day, the District asserts that the CO NAAQS will be maintained through the maintenance demonstration period.11

    11 Although the summary paragraph following Table 2-4 in the plan compares future year projections shown in the table to the “2011 Truckee Meadows maintenance emissions inventory,” EPA believes that the District clearly intended to make the comparison to the “Truckee Meadows Maintenance Emissions Limit,” as the District stated in this single-asterisk (*) note to the table. See 2014 Maintenance Plan, page 7.

    The EPA agrees with the District's conclusion. Even with the growth expected in the area in the future, overall emissions of CO in the area are declining and provide assurance that the area will not violate the CO standard in the future. With respect to wildfire emissions, we find that the District's approach of adjusting both the attainment inventory (i.e., the maintenance emissions limit) and the projected future year emissions inventories to exclude unusually high 2011 wildfire emissions is reasonable.

    D. Transportation Conformity

    Transportation conformity is required by section 176(c) of the CAA. Conformity to a SIP means that transportation activities will not produce new air quality violations, worsen existing violations, or delay timely attainment of the NAAQS. See CAA section 176(c)(1)(B). The EPA's conformity rule at 40 CFR part 93, subpart A requires that transportation plans, programs and projects conform to SIPs and establishes the criteria and procedures for determining whether or not they conform. To effectuate its purpose, the conformity rule generally requires a demonstration that emissions from the Regional Transportation Plan and the Transportation Improvement Program are consistent with the MVEBs contained in the applicable control strategy SIP revision or maintenance plan. See 40 CFR 93.101, 93.118, and 93.124. An MVEB is defined as the level of mobile source emissions of a pollutant relied upon in the attainment or maintenance demonstration to show compliance with the NAAQS in the nonattainment or maintenance area.12

    12 Further information concerning the EPA's interpretations regarding MVEBs can be found in the preamble to the EPA's November 24, 1993, transportation conformity rule (see 58 FR 62193-62196).

    The EPA's process for determining adequacy of a MVEB consists of three basic steps: (1) Notifying the public of a SIP submission; (2) providing the public the opportunity to comment on the MVEB during a public comment period; and, (3) making a finding of adequacy or inadequacy. See 40 CR 93.118(f). In order for us to find an MVEB adequate and approvable, the submittal must meet the conformity adequacy provisions of 40 CFR 93.118(e)(4) and (5). The 2005 Maintenance Plan established CO MVEBs (in terms of pounds per typical CO season day) of 330,678 pounds per typical CO season day in year 2010 and 321,319 pounds per typical CO season day in year 2016. The EPA found the CO MVEBs adequate for transportation conformity purposes effective March 30, 2006 (March 15, 2006, 71 FR 13386) 13 and approved the MVEBs on July 3, 2008 (73 FR 38124).

    13See also letter from Deborah Jordan, Director, U.S. EPA Region 9 Air Division, to Leo M. Drozdoff, P.E., Director, Nevada Division of Environmental Protection, dated February 14, 2006, available online at: https://www3.epa.gov/otaq/stateresources/transconf/adequacy/ltrs/truckee033006.pdf.

    The 2014 Maintenance Plan establishes new MVEBs for CO, as shown in Table 5.

    Table 5—Transportation Conformity Motor Vehicle Emissions Budgets for the Truckee Meadows CO Maintenance Area [lbs/day] Year 2015 2020 2025 2030 CO MVEB 172,336 172,670 171,509 169,959

    The District developed these MVEBs using emissions inventory projections for the years 2015 through 2030. The MVEBs include on-road vehicles, heavy duty diesel vehicle idling, and a safety margin. The latter is the excess emissions between the total projected emissions for a specific year and the 2011 maintenance emissions limit. We note that the MVEBs in the 2014 Maintenance Plan differ from those contained for similar years in the 2005 Maintenance Plan. These differences are due to the use of the latest planning assumptions for the transportation network, including VMT, vehicle speeds and vehicle population for passenger cars and trucks, in the development of the Washoe County 2011 periodic emissions inventory. As in previous periodic emissions inventories, these planning assumptions were consistent with those used by the local metropolitan planning organization for their transportation plans.

    We are not announcing the availability of these MVEBs through the EPA's Adequacy Web site and providing a separate comment period on the adequacy of the MVEBs. Instead, we are reviewing the adequacy of the MVEBs simultaneously with our review of the 2014 Maintenance Plan itself. See 40 CFR 93.118(f)(2). In order to determine whether these MVEBs are adequate and approvable, we have evaluated whether the MVEBs meet the conformity adequacy provisions of 40 CFR 93.118(e)(4) and (5) and have determined that the MVEBs meet the applicable criteria. These criteria include, for example, that the MVEBs are clearly identified and precisely quantified, that the Plan shows a clear relationship among the emissions budgets, control measures and the total emissions inventory, among other criteria. The details of the EPA's evaluation of the MVEBs are provided in a memo to file for this rulemaking.14

    14See memo from John J. Kelly, Air Planning Office, EPA Region 9, to Docket EPA-R09-OAR-2016-0096, dated August 5, 2016.

    In accordance with the State's request and the EPA's evaluation, with this action the EPA finds adequate and approves CO MVEBs for the years 2015, 2020, 2025 and 2030. Upon the effective date of this action, the Washoe County Regional Transportation Commission and the U.S. Department of Transportation must use these budgets in future conformity analyses. Any and all comments on the adequacy and approvability of the 2015, 2020, 2025 or 2030 MVEBs should be submitted during the comment period stated in the DATES section of this document.

    E. Ambient Air Quality Monitoring Network

    The District has maintained an ambient air quality monitoring network in Washoe County, including the Truckee Meadows area, in accordance with the EPA's ambient air quality monitoring network regulations in 40 CFR part 58. Monitors are operated by the District, and they submit an Annual Network Plans (ANPs) for the County to the EPA.

    The EPA is currently reviewing the 2016 ANP submitted by the District.15 The EPA approved the District's previous ANPs, the most recent three of which were submitted to the EPA by the District in 2013,16 2014 17 and 2015.18 The docket to this action includes these approvals and the associated ANPs, as well as the ANP currently under review.

    15 “Washoe County Health District Air Quality Management Division 2016 Ambient Air Monitoring Network Plan,” dated July 1, 2016.

    16 “Washoe County Health District Air Quality Management Division 2013 Ambient Air Monitoring Network Plan,” dated July 1, 2013 and our approval, letter from Meredith Kurpius, Manager, Air Quality Analysis Office, U.S. EPA Region 9 to Daniel Inouye, Chief, Monitoring and Planning Branch, Air Quality Management Division, Washoe County Health District, dated December 11, 2013.

    17 “Washoe County Health District Air Quality Management Division 2014 Ambient Air Monitoring Network Plan,” dated July 1, 2014 and our approval, letter from Meredith Kurpius, Manager, Air Quality Analysis Office, U.S. EPA Region 9 to Daniel Inouye, Chief, Monitoring and Planning, Air Quality Management Division, Washoe County Health District, dated October 29, 2014.

    18 “Washoe County Health District Air Quality Management Division 2015 Ambient Air Monitoring Network Plan,” dated July 1, 2015 and our approval, letter from Meredith Kurpius, Manager, Air Quality Analysis Office, U.S. EPA Region 9 to Daniel Inouye, Chief, Monitoring and Planning, Air Quality Management Division, Washoe County Health District, dated October 21, 2015.

    In addition to reviewing the District's ANPs, the EPA performs Technical Systems Audits (TSAs) of ambient air monitoring programs in accordance with 40 CFR part 58, appendix A, section 2.5, which requires that the EPA conduct a TSA of each primary quality assurance organization (PQAO) every three years. A PQAO is an organization that is responsible for a set of stations that monitor the same pollutant and for which data quality assessments can be pooled. The District is the PQAO for CO monitoring in Washoe County, which includes the Truckee Meadows area. See 40 CFR 58.1.

    The most recent TSA for the District was conducted by the EPA in 2016, but the report for that TSA has not yet been finalized. The most recent TSA for which the final report is available was conducted in 2013. The EPA found that the District's air monitoring program was robust and met the EPA's requirements. There were no findings that were cause for data invalidation.19

    19 See letter from Deborah Jordan, Director, U.S. EPA Region 9 Air Division, to Charlene Albee, Director, Air Quality Management Division, Washoe County Health District, dated August 19, 2014, transmitting a report titled “Technical System Audit Report, Washoe County Health District Air Quality Management Division Ambient Air Monitoring Program (September 4-6, 2013).”

    In the 2014 Maintenance Plan, the District commits to continued operation of its CO monitoring network, in accordance with 40 CFR part 58, to verify the attainment status of the Truckee Meadows area. See 2014 Maintenance Plan, page 8. In addition, the District will continue to review the Washoe County CO monitoring network pursuant to 40 CFR 58.10 to ensure the network meets the monitoring objectives defined in 40 CFR part 58, appendix D. Funding for the monitoring network to meet its objectives has been derived in the past primarily from CAA section 105 grants and the State's Department of Motor Vehicles. The District commits to maintaining these funding sources. See 2014 Maintenance Plan, page 8.

    The District commits to the continuation of collecting and quality-assuring ambient CO monitoring data in accordance with 40 CFR part 58 and to providing the data to the EPA's AQS. The data will therefore be available for public review. See 2014 Maintenance Plan, page 9.

    Table 6 lists the active Washoe County CO monitoring sites identified in the Plan. See 2014 Maintenance Plan, page 9, Table 2-7. As noted in the footnotes to the table, two of the monitoring sites have since discontinued CO monitoring (i.e., South Reno and Galletti), and the District has indicated that it intends to submit to the EPA a request to shut down two more sites (i.e., Toll and Lemmon Valley). The EPA notes that the Lemmon Valley monitoring site is within Washoe County but is not located in the Truckee Meadows area.

    Table 6—Active Washoe County CO Monitoring Sites Site ID Site name Site address City 32-031-0016 Reno3 301A State Street Reno. 32-031-0020 South Reno * 4110 DeLucchi Lane Reno. 32-031-0022 Galletti * 305 Galletti Way Reno. 32-031-0025 Toll ** 684A State Route 341 Reno. 32-031-1005 Sparks 750 4th Street Sparks. 32-031-2009 Lemmon Valley ** 325 W. Patrician Drive Reno. * The District discontinued CO monitoring at the South Reno and Galletti monitoring sites in 2014. Details of these network modifications, as well as copies of the EPA's approval letters, can be found in the District's 2015 ANP (Appendices A and B). ** In its 2016 ANP, the District indicates it will seek EPA approval to discontinue CO monitoring at the Toll and Lemmon Valley monitoring sites, but will not discontinue monitoring at these locations without such approval. See the District's 2016 ANP.

    The District is required to maintain a CO monitor at the Reno3 site. See 40 CFR part 58, appendix D, section 3. Other CO monitoring sites are not required for Washoe County by the EPA's minimum monitoring requirements. See 40 CFR part 58, appendix D, section 4.2.

    Based on the information in the 2014 Maintenance Plan, as well as recent ANPs and the 2013 TSA report, the EPA has determined that the area's air quality monitoring network meets the requirements of the CAA and implementing regulations in 40 CFR part 58.

    F. Verification of Continued Attainment

    To support the District's continued operation and maintenance of the Washoe County ambient CO monitoring network, the District also commits to tracking actual CO emissions, in order to identify potential increases in ambient CO concentration. The District has three existing mechanisms to track CO emissions.

    1. Periodic Emissions Inventories. The District commits to continuing to prepare and submit to the EPA a comprehensive periodic CO emissions inventory on a triennial schedule. Prior to submittal of the 2014 Maintenance Plan, the last periodic emissions inventory prepared was for the year 2011. See 2014 Maintenance Plan, page 9. In addition, the District has prepared and submitted to the EPA a periodic emissions inventory for the area for 2014.

    2. Consolidated Emissions Reporting Rule (CERR) and Air Emissions Reporting Rule (AERR). The EPA's AERR (40 CFR part 51 subpart A), which incorporates the former CERR, requires regular updates of point and area emissions sources within Washoe County. The District commits to continued compliance with the CERR and AERR. See 2014 Maintenance Plan, page 10.

    3. Residential Wood Use Survey. RWC is a significant source of CO emissions during the winter in Truckee Meadows. Between 1993 and 2013, the District completed nine residential wood use surveys. These surveys estimated the device (i.e., fireplace, woodstove and pellet stove) population, the amount of wood burned, and CO emissions from RWC in Washoe County. As part of the 2014 Maintenance Plan, the District renews the commitment it made in the 2005 Maintenance Plan to conduct a residential wood use survey at least once every three years. See 2014 Maintenance Plan, page 10.

    The EPA agrees with the District that continued ambient air monitoring and emissions tracking will ensure verification of continued attainment and maintenance of the 8-hour CO NAAQS within the Truckee Meadows area.

    G. Contingency Plan

    Section 175A of the CAA requires that a maintenance plan include contingency provisions, as necessary, to promptly correct any violation of a NAAQS that occurs after the redesignation to attainment of an area for that NAAQS. As a maintenance area for CO, this requirement applies to Truckee Meadows. According to the EPA's guidance,20 the contingency plan for a maintenance area should clearly identify the following:

    20 EPA's September 4, 1992 memorandum entitled “Procedures for Processing Requests to Redesignate Areas to Attainment,” at page 12, available online at: https://www.epa.gov/sites/production/files/2016-03/documents/calcagni_memo_-_procedures_for_processing_requests_to_redesignate_areas_to_attainment_090492.pdf.

    • Specific indicators or triggers that will be used to determine when contingency measures need to be implemented; • contingency measures to be adopted; • schedule and procedures for adoption and implementation; and • specific time limit for action.

    The following is the EPA's analysis of the 2014 CO Maintenance Plan's contingency plan regarding the above four criteria:

    The 2014 Maintenance Plan identifies significant sources that contribute to the highest CO concentrations during the winter CO season months, November through January. The 2014 Maintenance Plan includes a two-tiered contingency plan based on ambient air monitoring data.

    As part of the EPA's approval into the SIP of the 2005 Maintenance Plan, we approved a contingency plan for the area. Part of the contingency plan (“Tier 1”), as discussed in greater detail below, relies entirely on the area's emergency episode plan. Such plans are required under CAA section 110(a)(2)(G). We approved the District's emergency episode plan on June 18, 2007 (72 FR 33397).

    1. Contingency Plan Tier 1 a. Specific Indicators or Triggers Which Will Be Used To Determine When Contingency Measures Need To Be Implemented

    The Tier 1 trigger mechanism is a single exceedance of the 8-hour CO standard, that is, a monitored concentration greater than or equal to 9 ppm (9.5 ppm to adjust for rounding), at any State and Local Air Monitoring Station (SLAMS), Special Purpose Monitoring (SPM) or national Core Multi-Pollutant Monitoring Station (NCore) site operated within Washoe County. The EPA notes that this trigger is protective of the 8-hour CO NAAQS in three respects.

    First, it takes two non-overlapping CO exceedances to violate the standard. The CAA requires that, at a minimum, contingency measures be triggered when the standard is violated. In the 2014 Maintenance Plan, the District is committing to triggering this Tier 1 portion of its contingency plan with a single exceedance. This entails implementation of a contingency measure upon an exceedance of the CO NAAQS, before the NAAQS is violated.

    Second, the trigger for Tier 1 can occur at any monitor in the County. This is more protective of the CO NAAQS than would otherwise be required by the Act in that the District is required to trigger Tier 1 using an exceedance of any monitor in Washoe County, rather than relying only on the monitors within the Truckee Meadows maintenance area within the County.

    Third, implementation of Tier 1 would occur in the entire jurisdiction of the District, that is, County-wide. Controls related to the Stage 1 Alert episode would be implemented in the entire County, which could benefit the Truckee Meadows area within the County.

    b. The Contingency Measures To Be Adopted

    As we noted above, the EPA has already approved the District's emergency episode plan into the SIP. This emergency plan currently is triggered, independent of any contingency plan, during any monitored or predicted concentration at a level of 9.4 ppm or above. Once the emergency plan is triggered, the duration of its implementation depends on the circumstances of the episode, regarding monitored and predicted levels of CO.

    In the Tier 1 contingency measure, the District will initiate a rulemaking to permanently lower the County-wide Stage 1 Alert activation level from 9.4 ppm down to 9.0 ppm. The District will initiate this rulemaking if a monitored CO concentration is above 9.4 ppm (i.e., 9.5 ppm or above). Monitors that can activate Tier 1 include any monitor in the entire County, that is, not just within the Truckee Meadows area. For informational purposes, Table 7 lists the actions the District takes once a Stage 1 Alert level is either recorded or predicted for the County. See 2014 Maintenance Plan, page 11. When Tier 1 is triggered, the District will initiate a specific rulemaking change for adoption by the District's Board of Health (WCDBOH). In the event Tier 1 is triggered, the District would initiate revision of WCDBOH Regulation 050.001, Emergency Episode Plan (adopted March 23, 2006). The rule revision would revise the Stage 1 Alert level from the current level of 9.4 ppm down to the lower level of 9.0 ppm.

    Table 7—Stage 1 Alert Episode Actions Stage 1 alert episode action description WCDBOH regulation No. Terminate open burning 040.035 and 050.001. Terminate use of incinerators subject to District operating permits 050.001. Curtailment of unnecessary motor vehicle use through the District's public outreach program 050.001. Prohibition of the burning of solid fuel in any commercial or residential stoves and/or fireplaces with the Truckee Meadows area 040.051 and 050.001. Curtailment of all District permitted sources that have the potential to emit 50 tons or more of CO per year with the Truckee Meadows area 050.001. c. A Schedule and Procedures for Adoption and Implementation

    The implementation schedule the District identifies in the 2014 Maintenance Plan is meant to begin the rulemaking process promptly. The rule revision must be adopted by the WCDBOH and implemented before the next CO season (i.e., November, December and January).

    The District also commits to notify the EPA Region 9 office within 45 days of the triggering of tier 1. See 2014 Maintenance Plan, page 11.

    d. A Specific Time Limit for Action

    The schedule discussed above provides a specific time limit for action by the Board in that the rule revision is to be adopted and implemented before the next CO season.

    2. Contingency Plan Tier 2 a. Specific Indicators or Triggers Which Will Be Used To Determine When Contingency Measures Need To Be Implemented

    The Tier 2 trigger mechanism is a second, non-overlapping exceedance of the 8-hour CO standard (i.e., greater than or equal to 9.5 ppm to adjust for rounding) at any SLAMS, SPM or NCore site operated within Washoe County. The EPA notes that only a second non-overlapping exceedance at the same monitor would constitute a violation of the 8-hour CO NAAQS, so this approach is more protective of the standard than is required by the form of the standard itself. Also, the EPA notes that this trigger is also more protective of the CO NAAQS than is required because it goes beyond the boundary of the Truckee Meadows area and encompasses the entire Washoe County District.

    b. The Contingency Measures To Be Adopted

    For Tier 2, the District will maintain a list of potential contingency measures and provide recommendations to the WCDBOH. The District's recommendations to the Board will include a timeline for adoption and implementation to promptly correct any violation of the CO NAAQS. The list of Tier 2 potential contingency measures are shown in Table 8. See 2014 CO Maintenance Plan, Table 2-8.

    Table 8—Tier 2 Potential Contingency Measures Emission category Potential contingency measure Residential Wood Combustion • Increase one-acre lot size exemption.
  • • Mandatory curtailment at lower CO concentrations.
  • • Change-out program to cleaner-burning devices.
  • Mobile Sources • Strengthen inspection and maintenance smog check program.
  • • Reinstate oxygenated fuels program.
  • • Non-road and on-road diesel engine repowers and rebuilds.
  • • Truck Stop Electrification systems.
  • • Fleet modernization.
  • • Strengthen maximum idling time for diesel vehicles.
  • c. A Schedule and Procedures for Adoption and Implementation

    The implementation schedule the District identifies in the 2014 Maintenance Plan is meant to begin the rulemaking process promptly. No later than 45 days after Tier 2 is triggered, recommendations shall be presented to the Board at its next regularly scheduled meeting. The District commits to review and update as necessary the list of potential Tier 2 contingency measures at least once every three years. See 2014 Maintenance Plan, page 12. The District also commits to notify the EPA Region 9 office within 45 days of the triggering of Tier 2. See 2014 CO Maintenance Plan, page 12.

    d. A Specific Time Limit for Action

    The schedule discussed above for Tier 2 implementation provides a specific time limit for action by the Board. Rule revision recommendations are to be presented to the Board within a set time frame, and the Board will review and update the recommendations, as necessary, but not less than once every three years. Further, the time frame for the District to provide recommendations to the Board requires the District to present at the Board's next scheduled meeting, but no later than 45 days after triggering Tier 2. The Board typically meets every month.

    Tier 2 also involves a regular review of CO control measures by the District and the Board. This review occurs at least once every three years regardless of whether there is an exceedance of the CO NAAQS.

    3. Contingency Plan Conclusion

    The EPA agrees with the District that prompt action and implementation of Tier 1 and Tier 2 contingency measures may prevent future exceedances and violations of the 8-hour CO NAAQS. The EPA believes the District's two-tiered contingency plan will promptly address violations if they do occur. Triggering contingency measures at monitored concentration levels that exceed, but do not violate the standard, is an important component of this approach.

    III. Public Comment and Final Action

    As authorized in section 110(k)(3) of the Act, the EPA is fully approving the State of Nevada's second 10-year maintenance plan, titled “Second 10-Year Maintenance Plan for the Truckee Meadows 8-Hour Carbon Monoxide Attainment Area, August 28, 2014.” We are also approving MVEBs for the years 2015, 2020, 2025 and 2030.

    We do not think anyone will object to these approvals, so we are finalizing them without proposing them in advance. However, in the Proposed Rules section of this Federal Register, we are simultaneously proposing approval of the same submitted Plan and MVEBs. If we receive adverse comments by September 29, 2016, we will publish a timely withdrawal in the Federal Register to notify the public that the direct final approval will not take effect and we will address the comments in a subsequent final action based on the proposal. If we do not receive timely adverse comments, the direct final approval will be effective without further notice on October 31, 2016. This will incorporate this plan into the federally enforceable SIP and require use of the new MVEBs in all future CO conformity analyses.

    IV. Statutory and Executive Order Reviews

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

    • Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011); • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.); • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.); • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4); • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999); • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997); • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001); • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and • does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

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

    Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by October 31, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the Proposed Rules section of today's Federal Register, rather than file an immediate petition for judicial review of this direct final rule, so that the EPA can withdraw this direct final rule and address the comment in the proposed rulemaking. This action may not be challenged later in proceedings to enforce its requirements (see section 307(b)(2)).

    List of Subjects in 40 CFR Part 52

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

    Dated: August 15, 2016. Alexis Strauss, Acting Regional Administrator, Region IX.

    Chapter I, title 40 of the Code of Federal Regulations is amended as follows:

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

    42 U.S.C. 7401 et seq.

    Subpart DD—Nevada 2. Section 52.1470, paragraph (e) is amended by adding, under the table heading “Air Quality Implementation Plan for the State of Nevada” a new entry after the entry “Redesignation Request and Maintenance Plan for the Truckee Meadows Carbon Monoxide Non-Attainment Area (September 2005), excluding appendices B, C, and D” to read as follows:
    § 52.1470 Identification of plan.

    (e) * * *

    EPA-Approved Nevada Nonregulatory Provisions and Quasi-Regulatory Measures Name of SIP
  • provision
  • Applicable geographic or nonattainment area State submittal date EPA approval date Explanation
    Air Quality Implementation Plan for the State of Nevada1 *         *         *         *         *         *         * Second 10-Year Maintenance Plan for the Truckee Meadows 8-Hour Carbon Monoxide Attainment Area, August 28, 2014 Truckee Meadows, Washoe County 11/7/14 [INSERT Federal Register CITATION] (8/30/16) Fulfills requirement for second ten-year maintenance plan. Includes motor vehicle emissions budgets for 2015, 2020, 2025 and 2030. *         *         *         *         *         *         * 1 The organization of this table generally follows from the organization of the State of Nevada's original 1972 SIP, which was divided into 12 sections. Nonattainment and maintenance plans, among other types of plans, are listed under Section 5 (Control Strategy). Lead SIPs and Small Business Stationary Source Technical and Environmental Compliance Assistance SIPs are listed after Section 12 followed by nonregulatory or quasi-regulatory statutory provisions approved into the SIP. Regulatory statutory provisions are listed in 40 CFR 52.1470(c).
    [FR Doc. 2016-20662 Filed 8-29-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2016-0034; FRL-9947-19] Citrus tristeza Virus Expressing Spinach Defensin Proteins 2, 7, and 8; Temporary Exemption From the Requirement of a Tolerance AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes a temporary exemption from the requirement of a tolerance for residues of the Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 alone or in various combinations on citrus fruit (Citrus spp., Fortunella spp., Crop Group 10-10) when applied/used as a microbial pesticide in accordance with the terms of Experimental Use Permit (EUP) No. 88232-EUP-2. Southern Gardens Citrus submitted a petition to EPA under the Federal Food, Drug, and Cosmetic Act (FFDCA), requesting the temporary tolerance exemption. This regulation eliminates the need to establish a maximum permissible level for residues of Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 alone or in various combinations. The temporary tolerance exemption expires on August 31, 2020.

    DATES:

    This regulation is effective August 30, 2016. Objections and requests for hearings must be received on or before October 31, 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-2016-0034, 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:

    Robert McNally, Biopesticides and Pollution Prevention Division (7511P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

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

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

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

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

    You may access a frequently updated electronic version of 40 CFR part 180 through the Government 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-2016-0034 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 October 31, 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-2016-0034, by one of the following methods:

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

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

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

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

    II. Background and Statutory Findings

    In the Federal Register of March 29, 2016 (81 FR 17422) (FRL-9943-67), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide tolerance petition (PP 5F8418) by Southern Gardens Citrus, 1820 County Road 833, Clewiston, FL 33440. The petition requested that 40 CFR part 180 be amended by establishing a temporary exemption from the requirement of a tolerance for residues of Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 alone or in various combinations. That document referenced a summary of the petition prepared by the petitioner Southern Gardens Citrus, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing; however, several comments were received in response to the notice of issuance for the associated Experimental Use Permit No. 88232-EUP-2 that related to food safety and are found in Docket ID No. EPA-HQ-OPP-2016-0035. EPA's response to these comments is contained in Unit VII.B.

    Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the exemption is “safe.” Section 408(c)(2)(A)(ii) of FFDCA defines “safe ” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Pursuant to FFDCA section 408(c)(2)(B), in establishing or maintaining in effect an exemption from the requirement of a tolerance, EPA must take into account the factors set forth in FFDCA section 408(b)(2)(C), which require 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. . . .” Additionally, FFDCA section 408(b)(2)(D) requires that 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 performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. First, EPA determines the toxicity of pesticides. Second, EPA examines exposure to the pesticide through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings.

    III. Toxicological Profile

    Consistent with FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action and considered its validity, completeness and reliability, and the relationship of this information to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children.

    The pesticide chemical is Citrus tristeza virus that has been genetically altered to express spinach defensin proteins 2 (SoD2), 7 (SoD7), and 8 (SoD8) to combat Citrus Greening disease. Although EPA did not receive data on the altered virus itself, EPA has sufficient data to evaluate each component of the pesticide individually—i.e., the Citrus tristeza virus and the spinach defensin proteins 2, 7, and 8. Assessing overall risk based on the virus and spinach defensin proteins' individual risks is reasonable because the antimicrobial spinach defensin proteins are unlikely to change the host range of the plant virus and the plant virus is unlikely to affect the toxicity or allergenicity profile of the antimicrobial spinach defensin proteins.

    The U.S. human population has been exposed to the Citrus tristeza (C. tristeza) virus in citrus products for at least two decades since its discovery as being widespread in the Florida citrus industry in the mid-1990s. No adverse effects from this exposure in people have been reported. This lack of adverse effects is consistent with the fact that C. tristeza is a plant virus, which do not cause disease in humans; human intestines commonly harbor plant viruses without any adverse effect. (Ref 1).

    Spinach defensin proteins are naturally found in every spinach plant, and oral exposure to the spinach plant provides exposure to these proteins. There is a long history of mammalian consumption of the entire spinach plant (both raw and cooked)—including necessarily—these defensin proteins, as food, without causing any known deleterious human health effects or any evidence of toxicity. Spinach plant leaves have long been part of the human diet, and there have been no findings that indicate toxicity or allergenicity of spinach proteins.

    Bioinformatic sequence comparisons to assess the toxicity potential of spinach defensin proteins 2 (SoD2), 7 (SoD7), and 8 (SoD8) yielded no potential significant toxicity matches. Furthermore, literature searches did not produce any papers that showed any mammalian toxicity associated with spinach or spinach defensins. Available data demonstrate that SoD2, SoD7, and SoD8 proteins have very low oral toxicity. In an acute oral toxicity study conducted with a single dose of 5,000 milligram/kilogram (mg/kg) of microbial-produced SoD2 protein, no evidence of toxic or adverse effects was observed. Since SoD proteins are consumed in spinach without adverse effect and SoD2, SoD7, and SoD8 are similar both functionally in spinach and in regards to their amino acid sequence, the results of the acute oral toxicity study are applicable to all three proteins.

    Because SoD2, SoD7, and SoD8 are proteins, EPA also evaluated their potential for allergenicity. A literature search was performed to identify any published studies that might implicate these spinach proteins as allergens. No scientific references were found to suggest possible allergenicity associated with spinach or these spinach proteins. Finding no indication that these proteins are derived from a known allergenic source, EPA also considered the proteins' bioinformatics and resistance to digestibility.

    Searching both the AllergenOnline.org database and the National Center for Biotechnology Information (NCBI) Protein database for sequence similarities to known allergens, no significant sequence matches to SoD2, SoD7, and SoD8 were found using a sliding window of 80 amino acids.

    In an in vitro study, microbial produced SoD2 and SoD7 proteins were rapidly and extensively hydrolyzed in simulated gastric and intestinal conditions in the presence of pepsin (at pH 1.2) and pancreatin, respectively. Both microbial-produced SoD2 and SoD7 proteins demonstrated half-lives of approximately five minutes when subjected to pepsin digest, and both proteins were completely proteolyzed to amino acids and small peptide fragments in less than one minute in the presence of 0.15 milligram/liter (mg/ml) pancreatin. These results indicate that both the SoD2 and SoD7 proteins are highly susceptible to degradation in conditions similar to the human digestive tract.

    An evaluation of the similarities of SoD8 compared to SoD2 and SoD7 proteins to estimate SoD8 protein digestibility indicates that SoD8 should be digested very similarly to SoD2 and SoD7. The sequences are homologous, but SoD8 is longer on both the beginning and the end of the sequence. The proteins were found to be nearly identical in major overlapping sequences, while SoD8 has one more pepsin cleavage site compared to SoD2 and SoD7 which indicates that it will be even more susceptible to digestion.

    Based on the source, bioinformatics, and digestibility of these proteins, EPA concludes that these spinach defensin proteins will not pose any allergenicity concerns. In sum, EPA concludes that due to the lack of toxicity and pathogenicity concerns for C. tristeza and any toxicity or allergenicity concerns for the spinach defensin proteins 2, 7, and 8, the altered C. tristeza virus expressing those spinach defensin proteins does not pose any toxicity, pathogenicity, or allergenicity concerns. Therefore, EPA did not identify any points of departure for regulating exposure, and a qualitative assessment was conducted. For further information about EPA's assessment of the Citrus tristeza virus that has been genetically altered to express spinach defensin proteins 2 (SoD2), 7 (SoD7), and 8 (SoD8), see the C. tristeza SoD2, SoD7, and SoD8 Human Health Review March 2016 found in Docket ID No. EPA-HQ-OPP-2016-0035.

    IV. Aggregate Exposures

    In examining aggregate exposure, FFDCA section 408 directs EPA to consider available information concerning exposures from the pesticide residue in food and all other non-occupational exposures, including drinking water from ground water or surface water and exposure through pesticide use in gardens, lawns, or buildings (residential and other indoor uses).

    The Agency has considered available information on the aggregate exposure levels of consumers (and major identifiable subgroups of consumers) to the pesticide chemical residue and to other related substances. These considerations include dietary exposure under the tolerance exemption and all other tolerances or exemptions in effect for residue from genetically engineered C. tristeza expressing spinach defensins SoD2, SoD7, and SoD8, and exposure from non-occupational sources.

    The Agency anticipates that there may be dietary exposure to Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 (either alone or in combinations with each other) from the consumption of citrus products treated with this pesticide. Significant dietary exposure to spinach defensin proteins 2, 7, and 8 (either alone or in combinations with each other) from use of this pesticide is not expected due to the very low expression of the defensin proteins from the C. tristeza vector. Dietary exposure to spinach defensins from consumption of treated citrus products containing them will be far below the amount consumed from raw and cooked spinach. Recent U.S. consumption statistics indicate that, on average, 2 lbs. of spinach are consumed per person per year in the United States. “Spinach Profile,” Agricultural Marketing Resource Center (June 2013). (http://www.agmrc.org/commodities_products/vegetables/spinach-profile/). EPA has also approved another experimental use permit (88232-EUP-1) involving use of defensin proteins SoD2 and SoD7, to which people may be exposed. 75 kg of SoD proteins were authorized for treatment of 720 acres in Florida and Texas. May 6, 2015 (80 FR 25943) (FRL-9926-99) and August 28, 2015 (80 FR 52270) (FRL-9931-26). In terms of non-pesticidal dietary exposure, the U.S. population will continue to be exposed to C. tristeza virus through infected citrus plants and will continue to be exposed to these spinach defensin proteins through consumption of spinach plants.

    Residues in drinking water from use of this pesticide will be extremely low or non-existent since the pesticide will be present only in the vascular tissue of citrus trees and is applied under the bark, and it is highly unlikely that any environmental exposure will occur.

    The Agency does not expect there to be any non-occupational exposure to this pesticide chemical residue. Exposure via the skin or inhalation is not likely since the viral vector will be phloem limited in citrus trees, and very little phloem is present in citrus fruit, which essentially eliminates these exposure routes or reduces these exposure routes to negligible.

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

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

    Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 (either alone or in combinations with each other) is not toxic and does not have a common mechanism of toxicity with other substances. Consequently, section 408(b)(2)(D)(v) does not apply.

    VI. Determination of Safety for U.S. Population, Infants and Children A. Children's Safety Factor

    FFDCA section 408(b)(2)(C) provides that, in considering the establishment of a tolerance or tolerance exemption for a pesticide chemical residue, EPA shall assess the available information about consumption patterns among infants and children, special susceptibility of infants and children to pesticide chemical residues, and the cumulative effects on infants and children of the residues and other substances with a common mechanism of toxicity. In addition, FFDCA section 408(b)(2)(C) provides that EPA shall apply an additional tenfold (10X) margin of exposure (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 that a different margin of exposure (safety) will be safe for infants and children. This additional margin of exposure (safety) is commonly referred to as the Food Quality Protection Act Safety Factor (FQPA SF).

    In applying this provision, EPA either retains the default value of 10X or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor. Based on the information discussed in Unit III., EPA concludes that there are no threshold effects of concern to infants, children, or adults from exposure to the spinach defensin proteins 2, 7, and 8. As a result, EPA concludes that no additional margin of exposure (safety) is necessary to protect infants and children and that not adding any additional margin of exposure (safety) will be safe for infants and children.

    B. Determination of Safety

    EPA concludes that there is a reasonable certainty that no harm will result to the U.S. population, including infants and children, from aggregate exposure to the residues of C. tristeza virus expressing spinach defensin proteins 2, 7, and 8. Such exposure includes all anticipated dietary exposures and all other exposures for which there is reliable information. The Agency has arrived at this conclusion based on a lack of toxicity and allergenicity of the C. tristeza virus expressing spinach defensin proteins 2, 7, and 8.

    VII. Other Considerations A. Analytical Enforcement Methodology

    An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation based on the lack of any toxicity or allergenicity of the C. tristeza virus expressing spinach defensin proteins 2, 7, and 8.

    B. Response to Comments

    Five non-governmental organizations opposed the issuance of the temporary exemption from the requirement for a tolerance in order to prevent the issuance of the related experimental use permit (EUP). Their objections on the EUP focused on concerns about the potential for environmental impacts as a result of the pesticide spreading beyond the field trial boundaries of the EUP. They did not raise any concern about the human health or safety of the pesticide itself. Without more, the commenters have not provided a basis on which the Agency should reconsider issuing this temporary tolerance exemption. The FFDCA requires EPA to make a safety finding about the pesticide; the statutory scope of that review is focused on human health, not environmental, impacts.

    VIII. Conclusion

    Therefore, a temporary exemption is established for residues of Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 alone or in various combinations on commodities in the fruit, citrus, group 10-10, when used in accordance with the Experimental Use Permit No. 88232-EUP-2. Because Experimental Use Permit No. 88232-EUP-2 will expire on August 31, 2019, EPA is similarly limiting the term of this exemption; this temporary exemption from the requirement of a tolerance will expire on August 31, 2020.

    IX. Reference

    1. U.S. Environmental Protection Agency. Meeting Minutes of the FIFRA Scientific Advisory Panel Meeting Held December 6-8, 2005 on Plant-Incorporated Protectants Based on Virus Coat Protein Genes: Science Issues Associated with the Proposed Rule, http://www.regulations.gov. Docket No. EPA-HQ-OPP-2005-0249-12.

    X. Statutory and Executive Order Reviews

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

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

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

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

    XI. Congressional Review Act

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

    List of Subjects in 40 CFR Part 180

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

    Dated: August 10, 2016. Robert McNally, Director, Biopesticides and Pollution Prevention 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. Add § 180.1337 to subpart D to read as follows:
    § 180.1337 Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8; exemption from the requirement of a tolerance.

    A temporary exemption from the requirement of a tolerance is established for residues of the microbial pesticide Citrus tristeza virus expressing spinach defensin proteins 2, 7, and 8 (either alone or in combinations with each other) in or on the commodities listed in fruit, citrus group 10-10, when used in accordance with the terms of Experimental Use Permit No. 88232-EUP-2. This temporary exemption from the requirement of a tolerance expires on August 31, 2020.

    [FR Doc. 2016-20547 Filed 8-29-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 271 [EPA-R03-RCRA-2015-0674; FRL-9951-51-Region 3] Maryland: Final Authorization of State Hazardous Waste Management Program Revisions AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Direct final rule.

    SUMMARY:

    Maryland has applied to the United States Environmental Protection Agency (EPA) for final authorization of revisions to its hazardous waste program under the Resource Conservation and Recovery Act (RCRA). EPA has determined that these revisions satisfy all requirements needed to qualify for final authorization and is authorizing Maryland's revisions through this direct final rule. In the “Proposed Rules” section of today's Federal Register, EPA is also publishing a separate document that serves as the proposal to authorize these revisions. EPA believes this action is not controversial and does not expect comments that oppose it. Unless EPA receives written comments that oppose this authorization during the comment period, the decision to authorize Maryland's revisions to its hazardous waste program will take effect. If EPA receives comments that oppose this action, EPA will publish a document in the Federal Register withdrawing today's direct final rule before it takes effect and the separate document in today's “Proposed Rules” section of this Federal Register will serve as the proposal to authorize the revisions.

    DATES:

    This final authorization will become effective on October 31, 2016, unless EPA receives adverse written comments by September 29, 2016. If EPA receives any such comments, EPA will publish a timely withdrawal of this direct final rule in the Federal Register and inform the public that this authorization will not take effect.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R03-RCRA-2015-0674, by one of the following methods:

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

    2. Email: [email protected]

    3. Mail: Stacie Pratt, Mailcode 3LC50, Office of State Programs, U.S. EPA Region III, 1650 Arch Street, Philadelphia, PA 19103-2029.

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

    You may inspect and copy Maryland's application from 8:00 a.m. to 4:30 p.m., Monday through Friday at the following locations: Maryland Department of the Environment, Land Management Administration, Resource Management Program, 1800 Washington Blvd., Suite 610, Baltimore, Maryland 21230-1719, Phone number: (410) 537-3314, attn: Ed Hammerberg; and EPA Region III, Library, 2nd Floor, 1650 Arch Street, Philadelphia, PA 19103-2029, Phone number: (215) 814- 5254.

    Instructions: Direct your comments to Docket ID No. EPA-R03-RCRA-2015-0674. EPA's policy is that all comments received will be included in the public docket without change and may be made available online at www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI), or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through http://www.regulations.gov or email. The Federal regulations Web site, http://www.regulations.gov, is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to EPA without going through http://www.regulations.gov, your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses. (For additional information about EPA's public docket, visit the EPA Docket Center homepage at www.epa.gov/epahome/dockets.htm).

    Docket: All documents in the docket are listed in the http://www.regulation.gov index. Although listed in the index, some information is not publicly available, e.g., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy. Publicly available docket materials are available either electronically at http://www.regulations.gov or in hard copy.

    FOR FURTHER INFORMATION CONTACT:

    Stacie Pratt, Mailcode 3L50, Office of State Programs, U.S. EPA Region III, 1650 Arch Street, Philadelphia, PA 19103-2029; Phone: 215-814-5173.

    SUPPLEMENTARY INFORMATION: A. Why are revisions to State programs necessary?

    States that have received final authorization from EPA under RCRA section 3006(b), 42 U.S.C. 6926(b), must maintain a hazardous waste program that is equivalent to, consistent with, and no less stringent than the Federal program. As the Federal program is revised to become more stringent or broader in scope, States must revise their programs and apply to EPA to authorize the revisions. Authorization of revisions to State programs may be necessary when Federal or State statutory or regulatory authority is modified or when certain other revisions occur. Most commonly, States must revise their programs because of revisions to EPA's regulations in 40 Code of Federal Regulations (CFR) parts 124, 260 through 266, 268, 270, 273 and 279.

    B. What decisions has EPA made in this rule?

    On July 31, 2015, Maryland submitted a final program revision application (with subsequent corrections) seeking authorization of revisions to its hazardous waste program that correspond to certain Federal rules promulgated between January 14, 1985 and August 5, 2005. EPA concludes that Maryland's application to revise its authorized program meets all of the statutory and regulatory requirements established by RCRA, as set forth in RCRA section 3006(b), 42 U.S.C 6926(b), and 40 CFR part 271. Therefore, EPA grants Maryland final authorization to operate its hazardous waste program with the revisions described in its authorization application, and as outlined below in Section G of this document.

    Maryland has responsibility for permitting treatment, storage, and disposal facilities (TSDFs) within its borders and for carrying out the aspects of the RCRA program described in its application, subject to the limitations of the Hazardous and Solid Waste Amendments of 1984 (HSWA). New Federal requirements and prohibitions imposed by Federal regulations that EPA promulgates under the authority of HSWA take effect in authorized States before they are authorized for the requirements. Thus, EPA will implement those HSWA requirements and prohibitions for which Maryland has not been authorized, including issuing HSWA permits, until the State is granted authorization to do so.

    C. What is the effect of today's authorization decision?

    This action serves to authorize revisions to Maryland's authorized hazardous waste program. This action does not impose additional requirements on the regulated community because the regulations for which Maryland is being authorized by today's action are already effective and are not changed by today's action. Maryland has enforcement responsibilities under its state hazardous waste program for violations of its program, but EPA retains its authority under RCRA sections 3007, 3008, 3013, and 7003, which include, among others, authority to:

    • Perform inspections, and require monitoring, tests, analyses or reports;

    • Enforce RCRA requirements and suspend or revoke permits; and

    • Take enforcement actions regardless of whether Maryland has taken its own actions.

    D. Why wasn't there a proposed rule before today's rule?

    Along with this direct final rule, EPA is publishing a separate document in the “Proposed Rules” section of today's Federal Register that serves as the proposal to authorize these State program revisions. EPA did not publish a proposal before today's rule because EPA views this action as a routine program change and does not expect comments that oppose its approval. EPA is providing an opportunity for public comment now, as described in Section E of this document.

    E. What happens if EPA receives comments that oppose this action?

    If EPA receives comments that oppose this authorization, EPA will withdraw today's direct final rule by publishing a document in the Federal Register before the rule becomes effective. EPA will base any further decision on the authorization of Maryland's program revisions on the proposal mentioned in the previous section, after considering all comments received during the comment period. EPA will then address all such comments in a later final rule. You may not have another opportunity to comment. If you want to comment on this authorization, you must do so at this time.

    If EPA receives comments that oppose only the authorization of a particular revision to the State's hazardous waste program, EPA will withdraw that part of this rule, but the authorization of the program revisions that the comments do not oppose will become effective on the date specified above. The Federal Register withdrawal document will specify which part of the authorization will become effective, and which part is being withdrawn.

    F. What has Maryland previously been authorized for?

    Maryland initially received final authorization effective February 11, 1985 (50 FR 3511; January 25, 1985) to implement its base hazardous waste management program. EPA granted authorization for revisions to Maryland's regulatory program on June 1, 2001, effective July 31, 2001 (66 FR 29712), and on July 26, 2004, effective September 24, 2004 (69 FR 44463).

    G. What revisions is EPA authorizing with this action?

    On July 31 2015, Maryland submitted a final program revision application (with subsequent corrections), seeking authorization of additional revisions to its program in accordance with 40 CFR 271.21. Maryland's revision application includes various regulations that are equivalent to, and no less stringent than, selected Federal final hazardous waste rules, as published in the Federal Register between January 14, 1985 and August 5, 2005.

    EPA now makes a direct final regisule, subject to receipt of written comments that oppose this action, that Maryland's hazardous waste program revision application satisfies all of the requirements necessary to qualify for final authorization. Therefore, EPA grants Maryland final authorization for the following program revisions:

    1. Program Revision Changes for Federal Rules

    Maryland seeks authority to administer the Federal requirements that are listed in Table 1 below. This table lists the Maryland analogs that are being recognized as no less stringent than the analogous Federal requirements. Note that the Federal rules listed in Table 1 may include revisions related to the land disposal restriction (LDR) regulations. Maryland has not adopted, and is not seeking authorization for, the LDR regulations.

    Maryland's regulatory references are to Title 26, Subtitle 13 of the Code of Maryland Regulations (COMAR), Chapters 01 through 10, as amended effective November 12, 2010. The State's statutory authority for its hazardous waste program is based on the Environment Article of the Annotated Code of Maryland (2013 Replacement Volume and 2014 Supplement), and the State Government Article of the Annotated Code of Maryland (2014 Replacement Volume). Maryland's application also includes a revised Program Description, which provides a description of the hazardous waste regulatory program in Maryland.

    Table 1—Maryland's Analogs to the Federal Requirements Description of Federal requirement
  • (revision checklists 1)
  • Federal Register Analogous Maryland authority
    HSWA Cluster I Dioxin Waste Listing and Management Standards, Revision Checklist 14 50 FR 1978, 1/14/85 COMAR 26.13.02.05C(1)*, .05C(2)* .05C(5)*, .05C(6)(a), .05C(7)*, .07B(1) introductory paragraph*, .07B(3) introductory paragraph*, .15E introductory paragraph, .15E(1), .16, .19G, .22 Table 1, .22 Table 3, .23, .24; 26.13.05.09H(4) introductory paragraph, .09H(5), .11K(1), .11K(2), .12J(1), .12J(2), .13N(1), .13N(2), .14P(1), .14P(2), .16F(1)(a) and 16F(1)(b); 26.13.06.01A(6), .23C, .24B(1); 26.13.07.02D(21), .02-3B(9), .02-4B(17), .02-5B(10), .02-7B(7), .02-8B(8). (More stringent provisions: 26.13.06.01A(6), .23C, .24B(1)). *Certain portions of the regulations are considered broader in scope; see discussion in Section H.1(a). Location Standards for Salt Domes, Salt Beds, Underground Mines and Caves, Revision Checklist 17E 50 FR 28702, 7/15/85 COMAR 26.13.05.02-1F and 26.13.06.02G. Ground-Water Monitoring, Revision Checklist 17I 50 FR 28702, 7/15/85 COMAR 26.13.05.06A(3), .11G(2)(b). (More stringent provisions 26.13.05.11(G)(4), .12.E(4)(b), .14C(2)(b)). Pre-construction Ban, Revision Checklist 17M 50 FR 28702, 7/15/85 COMAR 26.13.07.01B. (More stringent provisions: 26.13.07.01B, no State analog to 40 CFR 270.10(f)(3)). Permit Life, Revision Checklist 17N 50 FR 28702, 7/15/85 COMAR 26.13.07.06.A and .06C. Research and Development Permits, Revision Checklist 17Q 50 FR 28702, 7/15/85 COMAR 26.13.07.02A and .19. Exposure Information, Revision Checklist 17S 50 FR 28702, 7/15/85 COMAR 26.13.07.02C and .02D(37). HSWA Cluster II Permit Modification, Revision Checklist 44D 52 FR 45788, 12/1/87 COMAR 26.13.07.11B(3). Permit Conditions to Protect Human Health and the Environment, Revision Checklist 44F 52 FR 45788, 12/1/87 COMAR 26.13.07.02D(36). Land Disposal Restrictions for Third Third Scheduled Wastes, Revision Checklist 78 2 55 FR 22520, 6/1/90 COMAR 26.13.02.10B, .11B, .12B, .13B, .14B, .16A/Table, .19C, .23/Table. (This checklist is HSWA Cluster II, with the exception of clarifying amendment to 261.33(c) which is in non-HSWA Cluster VI.) RCRA Cluster III Land Disposal Restrictions for Newly Listed Wastes and Hazardous Debris; Containment Buildings, Revision Checklist 109 2 57 FR 37194, 8/18/92 COMAR 26.13.01.03.B(9-1), .03.B(53), and .03.B(63);
  • 26.13.02.03.A(2)(c), .03.C-1(3) introductory paragraph through (3)(d), .03.C-1(3)(e)-(g), .03E introductory paragraph, .03E(1), and .03(E)(2);
  • 26.13.03.05.E(1)(b)(iii), 05.E(1)(b)(iv), .05.E(1)(e), .05.E(1)(l)(i), .05.E(1)(l)(iii), .05.E(1)(m), .05.E(1)(n), .05.E(4); 26.13.05.07.A(2)(a)-(d), .07.B(3), .07.C(1)(b), .08.A, .18, .18-1, .18-2(A), .18-2(B), .18-2(C)(1)-(2), .18-2(D)-(F), .18-3; 26.13.06.12A(1)-(4), .07B(3), .08E(10), .16A, .29; 26.13.07.13-2A(12) and .23.C(3)(f). (More stringent provisions: 26.13.07.13-2A(12); no State analogs to 40 CFR 270.42(e)(iii)(B) and 270.42 Appendix I Item I(6).) Toxicity Characteristic Amendment, Revision Checklist 117B 57 FR 23062, 6/1/92 COMAR 26.13.02.03A(2)(a) and .03A-1. RCRA Cluster IV Revision of Conditional Exemption for Small Scale Treatability Studies, Revision Checklist 129 59 FR 8362, 2/18/94 COMAR 26.13.02.04-4B(1)-(2), .04-4C, .04-4D, .04-4E, .04-5A(3)-(5), and .04-5A(11)(b). RCRA Cluster V Recovered Oil Exclusion, Revision Checklist 135 3 59 FR 38536, 7/28/94 COMAR 26.13.02.03C-1(2), .04A(15) and (16), .06A-1(1)(c) and Agency Note, and .06A-1(2)(c)-(e). Removal of the Conditional Exemption for Certain Slag Residues, Revision Checklist 136 2 59 FR 43496, 8/24/94 COMAR 26.13.10.01A(4). Carbamate Production Identification and Listing of Hazardous Waste, Revision Checklist 140 60 FR 7824, 2/9/95; as amended at 60 FR 19165, 4/17/95, and at 60 FR 25619, 5/12/95 COMAR 26.13.02.03A-2(5)-(7), .03C-1(4), .17, .19E, .19G, .23 and .24. RCRA Cluster VI RCRA Expanded Public Participation, Revision Checklist 148 3 60 FR 63417, 12/11/95 COMAR 26.13.01.03B(23-1); 26.13.07.02D(39), .04N, .14A(5), .17B(7)-(12), .17D, .19-1, .19-2A, .19-2B, .20-2A(5)-(6), .20-2D(4), .20-2E(1)(d)-(f), .20-2F(1)(a), .20F(1)(d), .20F(1)(h), .20-2F(3) and .20-3. (More Stringent Provisions: COMAR 26.13.07.17B(12)(c), .20-2A(5)-(6), .20-2F(3), .20-3.) Amendments to the Definition of Solid Waste; Amendment II, Revision Checklist 150 61 FR 13103, 3/26/96 COMAR 26.13.02.04A(15)-(16). RCRA Cluster VII Military Munitions Rule, Revision Checklist 156 62 FR 6622, 2/12/97 COMAR 26.13.01.03B(2-1), .03B(5-1), .03B(22-2)-.03B(22-4), .03B(37-1), .03B(51-1), .03B(51-2), .03B(51-3), .03B(69-1), .03B(87-2); 26.13.02.02A(2)(c)-(d);
  • 26.13.03.01J, .04A(6);
  • 26.13.04.01A(4)-(5);
  • 26.13.05.01A(2)(d)-(e), .01A(3)(h)(iv), .01D(5)-(6), .05A(2), .21;
  • 26.13.06.01A(2)(d)-(e), .01A(4)(h)(iv), .01A(5)(b)-(c), .05A, .28;
  • 26.13.07.01A, .13-1C;
  • 26.13.10.27*, .10.28B-D, .10.29-.31.
  • *Certain portions of the regulations are considered broader in scope; see discussion in Section H.1(b).
  • Land Disposal Restrictions Phase IV, Revision Checklist 157 2 62 FR 25998, 5/12/97 COMAR 26.13.02.01C(3)(b)-(e), .02G/Table 1, .04A(11), .04A(12), .06A-1(2)(b). Conformance With the Carbamate Vacatur, Revision Checklist 159 2 62 FR 32974, 6/17/97 COMAR 26.13.02.17A/Table, .19G, .23/Table, and .24. RCRA Cluster VIII Kraft Mill Steam Stripper Condensate Exclusion, Revision Checklist 164 63 FR 18504, 4/15/98 COMAR 26.13.02.04A(14). RCRA Cluster IX Petroleum Refining Process Wastes, Revision Checklist 169 23 63 FR 42110, 8/6/98 COMAR 26.13.02.03A-2(3), .03C-1(2), .03C-1(5), .04A(15)-(18), .06A-1(2)(e), .16A, .17A/Table, and .23/Table. Petroleum Refining Process Wastes—Leachate Exemption, Revision Checklist 178 64 FR 6806, 2/11/99 COMAR 26.13.02.04-1A(16) introductory language and (a)-(e) and .02.04-1A-1. RCRA Cluster X Land Disposal Restrictions
  • Phase IV—Technical Corrections, Revision Checklist 183 2
  • 64 FR 56469, 10/20/99 COMAR 26.13.02.17A/Table.
    Petroleum Refining Process Wastes Clarification, Revision Checklist 187 2 65 FR 36365, 6/8/00 COMAR 26.13.02.16A/Table. RCRA Cluster XI Chlorinated Aliphatics Listing and LDRs for Newly Identified Wastes, Revision Checklist 189 2 65 FR 67068, 11/8/00 COMAR 26.13.02.17A/Table, .23/Table, and .24. Mixture and Derived—From Rules Revisions, Revision Checklist 192A 66 FR 27266, 5/16/01 COMAR 26.13.02.03A(2)(c), .03A(2)(d), .03A-2, .03C(2)(a), .03F introductory language and (1)-(2). (More Stringent Provisions: COMAR 26.13.02.03C(2)(a).) RCRA Cluster XII Mixture and Derived—From Rules Revision II, Revision Checklist 194 66 FR 50332, 10/3/01 COMAR 26.13.02.03A(2)(d), .03A-2, and .03F(3). Inorganic Chemical
  • Manufacturing Wastes
  • Identification and Listing,
  • Revision Checklist 195 2
  • 66 FR 58258, 11/20/01 COMAR 26.13.02.04-1A(16)(a)-(e), .04-1A-1, .17A/Table, and .23 Table.
    Vacatur of Mineral Processing Spent Materials Being Reclaimed as Solid Wastes and TCLP Use With MGP Waste, Revision Checklist 199 67 FR 11251, 3/13/02 COMAR 26.13.02.02C(3) and .14A. RCRA Cluster XV Uniform Hazardous Waste Manifest Rule, Revision Checklist 207 70 FR 10776, 3/4/05; as amended 70 FR 35034, 6/16/05 COMAR 26.13.01.03B(12), .03B(50)-(51), .03B(55-1-1);
  • 26.13.02.07B(1)(b)(i)-(ii);
  • 26.13.03.04(A)(1),.04B(1)(b), .04B(1)(c)(i)-(ii), .04B(1)(d)-(e), .04(B)(2)(a)(ii), .04B(2)(b)-(d), .04B(3)-(6), .04C, .04D(2)(e), .04F(2)(a)-(b), .05C(2), .05D, .05E(4), .07-2A(3) and (5), .07-3B(3)-(4), .07-3C; 26.13.04.02A(1), .02A(7), .02B(2)-(4); 26.13.05.05A(2)-(3), .05B(1)(a)-(d) and (f)-(g), .05B(2)(d), .05B(5), .05C, .05G; 26.13.06.05A. RCRA Cluster XVI Universal Waste Rule: Specific Provisions for Mercury Containing Equipment, Revision Checklist 209 2 70 FR 45508, 8/5/2005 26.13.01.03B(2-2), .03B(46-1), .03B(51-2), .03B(72-2), .03B(89-1); 26.13.02.07-1B(3); 26.13.05.01A(3); 26.13.06.01A(4)(j)(iii); 26.13.07.01A; 26.13.10.06B(3); 26.13.10.09, .14, .17A(2)(d), .17A(3), .19C(1)(a)(iv)-(v), .20C, and .21A. 1 A Revision Checklist is a document that addresses the specific revisions made to the Federal regulations by one or more related final rules published in the Federal Register. EPA develops these checklists as tools to assist States in developing their authorization applications and in documenting specific State analogs to the Federal regulations. For more information see EPA's RCRA State Authorization Web page at http://www.epa.gov/osw/laws-regs/state/index.htm. 2 Maryland is not seeking authorization for the provisions related to the Land Disposal Restriction (LDR) regulations because Maryland has not adopted the LDR regulations. 3 Maryland is not seeking authorization for the provisions related to the Boiler and Industrial Furnace (BIF) regulations because Maryland has not adopted these regulations.
    2. State-Initiated Changes

    Maryland's program revision application includes State-initiated changes that are not directly related to any of the Revision Checklists in Table 1. Each State-initiated change is related to one of the following: (1) The adoption of a provision that makes internal clarification and conforming changes to the State's regulations, (2) adoption of a provision that makes the State's regulations, which had been more stringent, now equivalent to the Federal hazardous waste regulations, or (3) correction of typographical errors. EPA has evaluated the changes and has determined that the State's regulations remain consistent with, and are no less stringent than, the corresponding Federal regulations. EPA grants Maryland final authorization for the State provisions listed in Table 2. These requirements are analogous to the indicated Federal RCRA regulations found at relevant or applicable 40 CFR sections as of July 1, 2005.

    Table 2—Equivalent State-Initiated Changes State citation (COMAR) Federal RCRA citation (40 CFR) 26.13.02.05D(2)(c)(iv) No direct Federal analog. Related to 40 CFR 261.5(g)(3). 26.13.02.11A(3), A(4), and C; 26.13.02.11-1 40 CFR 261.21(a)(3); No Federal analog to 26.13.02.11-1. 26.13.02.13A(8) and C 40 CFR 261.23(a)(8). 26.13.03.07-5A(2) 262.58(a). 26.13.06.01A(4)(k) 265.1(c)(13). 26.13.07.20-2F(3)(e) No Federal analog in 40 CFR 124.32. 26.13.10.03A 266.70(a). 26.13.10.04C 266.80. 26.13.10.26 No Federal analog in 40 CFR 273. H. Where are the revised Maryland rules different from the federal rules? 1. Maryland Requirements That Are Broader in Scope

    The Maryland hazardous waste program contains certain provisions that are broader in scope than the Federal program. These broader in scope provisions are not part of the program being authorized by today's action. EPA cannot enforce requirements that are broader in scope, although compliance with such provisions is required by Maryland law. Examples of broader in scope provisions of Maryland's program include, but are not limited to, the following:

    (a) COMAR 26.13.02.05C(1) and (2), .05.C(5), .05C(6)(b), .05C(7), .07B(1) introductory paragraph, .07B(3) introductory paragraph, and .15E(2) (part of the State's analogs to 40 CFR 261.5(e), 261.7(b), and 261.30(d)) contain references to polychlorinated biphenyls (PCBs) and to State-only wastes listed at COMAR 26.13.02.17 (K991 through K999; military wastes), COMAR 26.13.02.18 (MD01: a type of Filter cake and chemical sludge) and COMAR 26.13.02.19.F (M001: PCBs above 500 parts per million (ppm), which is regulated under the Toxic Substances and Control Act (TSCA)). The portions of these provisions that are associated with the State-only wastes and the PCBs above 500 ppm go beyond the scope of the Federal program because PCBs and the State-only wastes are not Federal hazardous wastes and, thus, are not part of the program being authorized by today's action.

    (b) At COMAR 26.13.10.27B(3)(a)-(b), Maryland has included as solid wastes those unused military munitions that have been abandoned by being treated ((3)(a)(v)) or removed from storage and treated ((3)(b)(iii)). The Federal analogs at 40 CFR 266.202(b)(1) and (2) do not include treatment alone as a requirement for becoming a solid waste. Instead, treatment is used in the context of the step prior to disposal (see 56 FR 6626). As such, Maryland's requirements at COMAR 26.13.10.27B(3)(a)(v) and 26.13.10.27B(3)(b)(iii) are broader in scope than the Federal program, where an unused munition that is subject to chemical treatment without disposal would not be regulated as a solid waste.

    (c) Maryland has not adopted the mixed waste rule (66 FR 27218). Therefore, Maryland does not have an analog to 40 CFR 261.3(h), which exempts eligible radioactive mixed waste from regulation as a hazardous waste. As a result, Maryland's regulations is broader in scope than the Federal program because eligible radioactive mixed wastes are not Federal hazardous wastes and, thus, are not part of the program being authorized by today's action.

    (d) Maryland has not adopted the vacatur of mineral processing spent materials being reclaimed as solid wastes. Therefore, Maryland does not have an analog to 40 CFR 261.4(a)(17). By regulating these materials, Maryland's program is broader in scope than the Federal program because these materials are not Federal solid wastes and, thus, are not part of the program being authorized by today's action.

    2. Maryland Requirements That Are More Stringent Than the Federal Program

    Maryland's hazardous waste program contains several provisions that are more stringent than the RCRA program. The more stringent provisions are part of a Federally-authorized program and are, therefore, Federally-enforceable. The specific more stringent provisions are also noted in Table 1 and in Maryland's authorization application. They include, but are not limited to, the following:

    (a) Maryland has not adopted analogs to the Federal provisions at 40 CFR 265.1(d)(1)(iv)-(v), which allow dioxin wastes to be burned in certain incinerators and facilities that thermally treat the waste in other devices. Maryland has replaced these provisions with a provision at COMAR 26.13.06.01.A(6)(d) that allows dioxin wastes to be managed at a permitted facility, thus making Maryland's regulations more stringent.

    (b) The Federal regulations at 40 CFR 265.352 and 265.383 allow owners and operators of incinerators and thermal treatment devices who have received the required certification to burn EPA hazardous wastes F020, F021, F022, F023, F026, or F027. However, Maryland's regulations at COMAR 26.13.06.23C and .24.B(1) prohibit the burning of such wastes, thus making Maryland's regulations more stringent.

    (c) Maryland did not adopt an analog to the Federal provision at 40 CFR 270.10(f)(3), which was removed by the July 15, 1985 rule (50 FR 28702), nor has Maryland adopted the optional provision introduced by the July 15, 1985 rule at 40 CFR 270.10(f)(3). As a result, COMAR 26.13.07.01B, which is Maryland's analog to 40 CFR 270.10(f)(1), does not include the phrase analogous to “except as provided in paragraph (f)(3) of this section.” The Federal provision at 40 CFR 270.10(f)(3) allows a person to construct a facility for the incineration of PCBs without a RCRA permit if an approval has been issued under TSCA. Without this exemption, Maryland's regulations are more stringent.

    (d) Certain provisions of Maryland's regulations pertaining to containment buildings are considered more stringent than the Federal requirements. These provisions include:

    • Maryland has not adopted an analog to 40 CFR 270.42(e), which allows the Director to grant a permittee a temporary authorization without prior public notice and comment. Maryland's regulations are considered more stringent because it does not provide for temporary authorizations.

    • The Federal regulations at 40 CFR 270.42 Appendix I classify the conversion of an enclosed waste pile to a containment building as a Class 2 modification. Unlike the Federal regulations, which have three classes of permit modifications, Maryland only lists minor modifications in COMAR 26.13.07.13-2. Any modification not listed in COMAR 26.13.07.13-2 is a major modification in Maryland. Maryland's regulations are more stringent because it treats this Class 2 modification in the Federal regulations as a major modification.

    • Maryland has adopted the Federal Class 1 modifications of 40 CFR 270.42 Appendix I as part of its minor modifications. Maryland's regulations are more stringent because it treats the Federal Class 2 and 3 permit modifications for containment buildings as major modifications.

    (e) Maryland has several additional requirements for public participation in the hazardous waste program permitting process, which make the State's regulations more stringent. The requirements include, but are not limited to, the following:

    • Maryland's regulations at COMAR 26.13.07.17B(12)(c) provides a specific number of days (30) rather than requiring “a reasonable period of time,” as found in the Federal regulations. Therefore, Maryland's regulations are considered more stringent.

    • Maryland's requirements at COMAR 26.13.07.20-2A(5) and (6) are more stringent because public notice must also be given of receipt of an application for a permit modification and of receipt of an application for post-closure activities.

    • Maryland's regulations at COMAR 26.13.07.20-2F(3)(e) require that the public notice include information on how to request that an informational meeting be held. This requirement is an additional requirement making Maryland's regulations more stringent.

    • Maryland's regulations at COMAR 26.13.07.20-3 require the Director to hold informational meetings under specific conditions, which is considered more stringent than the Federal regulations.

    (f) Maryland has not adopted the mixed waste rule (66 FR 27218). Therefore, Maryland's regulation at COMAR 26.13.02.03C(2) is more stringent than the Federal requirements because the Maryland regulation does not include all of the exceptions found in the analogous Federal regulation at 40 CFR 261.3(c)(2)(i).

    3. Federal Requirements for which Maryland is not Seeking Authorization

    Maryland is not seeking authorization for the land disposal restriction (40 CFR 268), used oil standards (40 CFR 279), boiler and industrial furnace standards (40 CFR 266, Subpart H), air emission standards (40 CFR 264 and 265, Subparts AA, BB, and CC), or HSWA corrective action requirements.

    I. Who handles permits after the authorization takes effect?

    After this authorization revision, Maryland will issue permits covering all the provisions for which it is authorized and will administer all such permits. EPA will continue to administer any RCRA hazardous waste permits or portions of permits that it issued prior to the effective date of this authorization until the timing and process for effective transfer to the State are mutually agreed upon. Until such time, as EPA formally transfers responsibility for a permit to Maryland and EPA terminates its permit, EPA and Maryland agree to coordinate the administration of such permit in order to maintain consistency. EPA will not issue any more new permits or new portions of permits for the provisions listed in Section G after the effective date of this authorization. EPA will continue to implement and issue permits for HSWA requirements for which Maryland is not yet authorized.

    J. How does this action affect Indian country (18 U.S.C. 115) in Maryland?

    Maryland is not seeking authority to operate the program on Indian lands, since there are no Federally-recognized Indian Lands in Maryland.

    K. What is codification and is EPA codifying Maryland's hazardous waste program as authorized in this rule?

    Codification is the process of placing the State's statutes and regulations that comprise the State's authorized hazardous waste program into the Code of Federal Regulations. We do this action by referencing the authorized State rules in 40 CFR part 272. EPA reserves the amendment of 40 CFR part 272, subpart V, for this authorization of Maryland's program revisions until a later date.

    L. Administrative Requirements

    The Office of Management and Budget (OMB) has exempted this action from the requirements of Executive Order 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011). Therefore, this action is not subject to review by OMB. This action authorizes State requirements pursuant to RCRA section 3006 and imposes no additional requirements beyond those imposed by State law. Accordingly, I certify that this action will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because this action authorizes pre-existing requirements under State law and does not impose any additional enforceable duty beyond that required by State law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). For the same reason, this action also does not significantly or uniquely affect the communities of Tribal governments, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). In any case, Executive Order 13175 does not apply to this rule since there are no Federally recognized tribes in Maryland.

    This action will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999) because it merely authorizes State requirements as part of the State RCRA hazardous waste program without altering the relationship or the distribution of power and responsibilities established by RCRA. This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997) because it is not economically significant, and it does not concern environmental health or safety risks that may disproportionately affect children. This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not a significant regulatory action under Executive Order 12866.

    Under RCRA section 3006(b), EPA grants a State's application for authorization as long as the State meets the criteria required by RCRA. It would thus be inconsistent with applicable law for EPA, when it reviews a State authorization application, to require the use of any particular voluntary consensus standard in place of another standard that satisfies the requirements of RCRA. Thus, the requirements of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 3701, et seq.) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 18, 1988) by examining the takings implications of the rule in accordance with the Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings issued under the executive order. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). Burden is defined at 5 CFR 1320.3(b). Executive Order 12898 (59 FR 7629, February 16, 1994) establishes Federal executive policy on environmental justice. Its main provision directs Federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States. Because this rule authorizes pre-existing State rules which are at least equivalent to, and no less stringent than, existing Federal requirements, and imposes no additional requirements beyond those imposed by State law, and there are no anticipated significant adverse human health or environmental effects, the rule is not subject to Executive Order 12898.

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this document and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2). This action will be effective October 31, 2016.

    List of Subjects in 40 CFR Part 271

    Environmental protection, Administrative practice and procedure, Confidential business information, Hazardous waste, Hazardous waste transportation, Indian lands, Intergovernmental relations, Penalties, Reporting and recordkeeping requirements.

    Authority:

    This action is issued under the authority of sections 2002(a), 3006 and 7004(b) of the Solid Waste Disposal Act, as amended, 42 U.S.C. 6912(a), 6926, 6974(b).

    Dated: August 12, 2016. Shawn M. Garvin, Regional Administrator, EPA Region III.
    [FR Doc. 2016-20849 Filed 8-29-16; 8:45 am] BILLING CODE 6560-50-P
    DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Part 225 [Docket DARS-2016-0029] RIN 0750-AJ04 Defense Federal Acquisition Regulation Supplement: Request for Audit Services in France, Germany, the Netherlands, or the United Kingdom (DFARS Case 2016-D027) AGENCY:

    Defense Acquisition Regulations System, Department of Defense (DoD).

    ACTION:

    Final rule.

    SUMMARY:

    DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to specify the countries with which DoD has audit agreements.

    DATES:

    Effective August 30, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Ms. Amy G. Williams, telephone 571-372-6106.

    SUPPLEMENTARY INFORMATION: I. Background

    DoD is amending DFARS 225.872-6 to specify the qualifying countries that have audit agreements with the United States (i.e., France, Germany, the Netherlands, and the United Kingdom).

    II. Publication of This Final Rule for Public Comment Is Not Required by Statute

    The statute that applies to the publication of the Federal Acquisition Regulation (FAR) is 41 U.S.C. 1707 entitled “Publication of Proposed Regulations.” Paragraph (a)(1) of the statute requires that a procurement policy, regulation, procedure, or form (including an amendment or modification thereof) must be published for public comment if it relates to the expenditure of appropriated funds, and has either a significant effect beyond the internal operating procedures of the agency issuing the policy, regulation, procedure, or form, or a significant cost or administrative impact on contractors or offerors. This final rule is not required to be published for public comment, because it only specifies the qualifying countries that have audit agreements with the United States, rather than requiring each contracting officer to contact the Deputy Director of Defense Procurement and Acquisition Policy (Contract Policy and International Contracting), to determine whether a qualifying country has such an audit agreement. These regulations affect only the internal operating procedures of the Government.

    III. Applicability to Contracts at or Below the Simplified Acquisition Threshold (SAT) and for Commercial Items, Including Commercially Available Off-the-Shelf (COTS) Items

    This case does not add any new provisions or clauses or impact any existing provisions or clauses.

    IV. Executive Orders 12866 and 13563

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

    V. Regulatory Flexibility Act

    The Regulatory Flexibility Act does not apply to this rule because this final rule does not constitute a significant DFARS revision within the meaning of FAR 1.501-1, and 41 U.S.C. 1707 does not require publication for public comment.

    VI. Paperwork Reduction Act

    The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

    List of Subjects in 48 CFR Part 225

    Government procurement.

    Jennifer L. Hawes, Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR part 225 is amended as follows:

    PART 225—FOREIGN ACQUISITION 1. The authority citation for 48 CFR part 225 continues to read as follows: Authority:

    41 U.S.C. 1303 and 48 CFR chapter 1.

    2. Revise section 225.872-6 to read as follows:
    225.872-6 Request for audit services.

    Handle requests for audit services in France, Germany, the Netherlands, or the United Kingdom in accordance with PGI 215.404-2(c), but follow the additional procedures at PGI 225.872-6.

    [FR Doc. 2016-20476 Filed 8-29-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Part 231 [Docket DARS-2016-0002] RIN 0750-AI86 Defense Federal Acquisition Regulation Supplement: Costs Related to Counterfeit Electronic Parts (DFARS Case 2016-D010) AGENCY:

    Defense Acquisition Regulations System, Department of Defense (DoD).

    ACTION:

    Final rule.

    SUMMARY:

    DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement a section of the National Defense Authorization Act for Fiscal Year 2016 that amends the allowability of costs of counterfeit electronic parts or suspect counterfeit electronic parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts.

    DATES:

    Effective August 30, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Ms. Amy G. Williams, telephone 571-372-6106.

    SUPPLEMENTARY INFORMATION: I. Background

    DoD published a proposed rule in the Federal Register at 81 FR 17055 on March 25, 2016, to implement section 885(a) of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2016 (Pub. L. 114-92). Section 818(c)(2)(B) of the NDAA for FY 2012, as amended by section 885(a), provides that the costs of counterfeit electronic parts or suspect counterfeit electronic parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts are not allowable unless—

    • The covered contractor has an operational system to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts that had been reviewed and approved by DoD;

    • The counterfeit electronic parts or suspect counterfeit electronic parts were provided to the covered contractor as Government property in accordance with the Federal Acquisition Regulation (FAR) part 45, or were obtained by the contractor in accordance with the regulations described in paragraph (c)(3) of section 818 of the NDAA for FY 2012, as amended;

    • The contractor discovers the counterfeit electronic parts or suspect counterfeit electronic parts and provides timely (i.e., within 60 days after the contractor becomes aware) notice to the Government, pursuant to section 818(c)(4).

    Section 885 is the third in a series of amendments to section 818(c) of the NDAA for FY 2012, summarized as follows:

    FY 2012 Pub. L. 112-81 Section 818 FY 2013 Sec. 833 amended FY 2015 Sec. 817 amended FY 2016 Sec. 885 amended (a) Assessment of DoD Policies and Systems. (b) Actions Following Assessment. (c) Regulations (c)(2)(B) (c)(3) (c)(2)(B)
  • (c)(3)(D)
  • *         *         *         *         *         *         * (e) Improvement of Contractor Systems for Detection and Avoidance of Counterfeit Electronic Parts. (f) Definitions. *         *         *         *         *         *         *

    Section 803 of the NDAA for FY 2014, entitled Identification and Replacement of Obsolete Electronic Parts, did not modify section 818 of the NDAA for FY 2012 and is not directly related to the detection and avoidance of counterfeit electronic parts.

    DoD has processed several DFARS cases to implement section 818 and its subsequent amendments as follows:

    DFARS case Title Implements Published 2012-D055 Detection and Avoidance of Counterfeit Electronic Parts Sec. 818 (b)(1), (c)(partial), (e), and (f); as amended by sec. 833 of NDAA for FY 2013 Final rule published 5/6/2014. 2014-D005 Detection and Avoidance of Counterfeit Electronic Parts—Further Implementation Sec. 818 (c)(3); as amended by sec. 817 of NDAA for FY 2015, except sec. 818 (c)(3)(C) Final rule published 8/2/2016. 2015-D020 DoD Use of Trusted Suppliers for Electronic Parts Sec. 818(c)(3)(C) Not yet published. 2016-D010 Costs Related to Counterfeit Electronic Parts Sec. 818(c)(2)(B), as amended by sec 885(a) of NDAA for FY 2016 This final rule. 2016-D013 Amendments Related to Sources of Electronic Parts Sec. 818(c)(3)(D)(ii), as amended by sec. 885(b) of NDAA for FY 2016 Proposed rule published 8/2/2016.

    In addition, there are two related FAR cases:

    • FAR Case 2012-032, Higher-Level Contract Quality Requirements, does not specifically implement section 818 of the NDAA for FY 2012, but the performance of higher-level quality assurance for critical items does assist in the detection and avoidance of counterfeit electronic parts (final rule published November 25, 2014, effective December 26, 2014).

    • FAR Case 2013-002, Expanded Reporting of Nonconforming Items, expands beyond the requirements of section 818(c)(4), applying Governmentwide (not just DoD) to certain parts with a major or critical nonconformance (not just counterfeit electronic parts) (proposed rule published June 10, 2014).

    Two respondents submitted public comments in response to the proposed rule.

    II. Discussion and Analysis

    DoD reviewed the public comments in the development of the final rule. A discussion of the comments and the changes made to the rule as a result of those comments is provided, as follows:

    A. Summary of Changes From the Proposed Rule in Response to Public Comments

    The final rule includes the following changes from the proposed rule at DFARS 231.205-71(b):

    1. (b)(1)—Replaced “counterfeit parts” with “counterfeit electronic parts” (see section II.B.5. of this preamble).

    2. (b)(3)(i)—Replaced “Discovers” with “Becomes aware of” and added clarifying language (see section II.B.3.c. of this preamble).

    3. (b)(3)(ii)—Added the requirement to provide notice of counterfeit parts to Government Industry Exchange Program (GIDEP), with some exceptions (see section II.B.3.d. of this preamble).

    B. Analysis of Public Comments 1. Support for the Statute

    Comment: One respondent stated that industry wholeheartedly supports the change to the statute to expand the conditional safe harbor from strict liability for costs to remedy damage resulting from the discovery of counterfeit electronic parts and suspect counterfeit electronic parts in end products delivered to DoD.

    Response: Noted.

    2. Number and Timing of Cases

    Both respondents commented on the number and timing of cases in process to implement section 818 of the NDAA for FY 2012, as amended.

    Comment: One respondent applauded the deliberate and thoughtful approach by DoD to proceed with great care over a period of years to ensure the requirements are implemented with minimal disruption to the DoD supply chain.

    Response: Noted.

    Comment: One respondent recommended comprehensive, rather than “piecemeal” regulations. The respondent was concerned that this case should be considered and resolved together with DFARS cases 2014-D005 and 2016-D013 in a proposed rule with opportunity for notice and comment on the entire rule. The other respondent requested that DoD align the open cases to create a safe harbor that is efficient and complementary to the goal of building a risk-based framework to reduce the risk of counterfeit electronic parts from entering the DoD supply chain.

    Response: Sometimes the best way to achieve a goal is to divide the task into segments that can be accomplished sequentially. Furthermore, the legislation to be implemented was enacted in four separate statutes over a period of 4 years, necessitating additional cases to implement the statutory amendments. DFARS Case 2014-D005 had already been published as a proposed rule on September 21, 2015, prior to enactment of the NDAA for FY 2016 on November 25, 2016. DoD carefully considered whether the new amendments should be incorporated into the existing rule, or whether DFARS Case 2014-D005 should be finalized and followed by the two cases to implement section 885(a) and (b) of the NDAA for FY 2016.

    • Because both DFARS cases 2016-D010 and 2016-D013 required publication for public comment, they could not be incorporated in a final rule under 2014-D005.

    • At the time of public comment on this rule, the respondents were able to view the proposed rule under DFARS Case 2014-D005. If the two new cases were published as proposed rules, separately or in combination with DFARS Case 2014-D005, the respondents would still not know what the final rule under 2014-D005 would be, at the time of commenting on the new aspects of the case. Furthermore, implementation of DFARS Case 2014-D005 would be delayed by at least a year if it were not finalized prior to implementation of the new requirements of section 885 of the NDAA for FY 2016.

    • DoD considered it important to reduce supply chain risk as soon as possible by proceeding to finalize DFARS Case 2014-D005. DFARS Case 2014-D005 further implements section 818(c)(3)(A), (B), and (D) to provide detailed regulations to all DoD contractors and subcontractors that provide electronic parts to the Government, either as end items or components (not just cost accounting standards (CAS)-covered contractors and their subcontractors). If each phase of implementation of the rule were delayed until every new amendment was ready to be incorporated, DoD would still have nothing in place to protect against the hazards of counterfeit electronic parts in the DoD supply chain.

    • DFARS Case 2016-D013 could not be published as a proposed rule until DFARS case 2014-D005 was finalized (81 FR 50635 on August 2, 2016), in order to provide the baseline for the required change.

    • There was interest in expediting this DFARS Case 2016-D010, because it impacts cost allowability, and the text of this case is not overlapping with the text of DFARS Case 2014-D005. Therefore, this case was published as a proposed rule prior to publication of the final rule under DFARS Case 2014-D005.

    • Although the respondents did not have the opportunity to see the final rule under DFARS Case 2014-D005 prior to providing comments on this case, DoD considered all other related cases when finalizing DFARS Case 2014-D005, proposing DFARS Case 2016-D013, and now finalizing this case.

    3. Contractor Requirements Related to Allowability of Costs (Safe Harbor) a. Have an Approved Operational System

    Comment: One respondent stated that DFARS Case 2014-D005 addresses precisely what would be considered an operational system, who provides the needed approval, and how approval will be obtained.

    Response: DFARS Case 2012-D055 (finalized May 6, 2014) added the regulations on—

    • The contractors' purchasing system reviews (DFARS 244.305), which also cover review of the adequacy of the contractor's counterfeit electronic part detection and avoidance system; and

    • The contractors' counterfeit electronic part detection and avoidance system (DFARS 246.870 and the clause at 252.246-7007). DFARS Case 2014-D005 (finalized August 2, 2016) did not make any changes to the coverage at DFARS 244.305, so did not impact who approves the operational system and how the approval is obtained. DFARS Case 2014-D005 did implement section 818(c)(3)(D) at DFARS 246.870-2(a), authorizing contractors and subcontractors to identify and use additional trusted suppliers (contractor-approved suppliers) in some circumstances. Therefore, DFARS Case 2014-D005 amended one of the 12 system criteria at DFARS 246.870 (i.e., the criterion relating to use of suppliers) by providing a cross reference to the more detailed coverage on sources of electronic parts now provided at DFARS 246.870-2(a). In addition, the clause at DFARS 252.246-7007 included some additional definitions of terms relating to sources of electronic parts, and cross-referenced to the new clause at DFARS 252.246-7008 for consistency in the requirements relating to traceability and sources of electronic parts between CAS-covered contractors with operational systems and all other DoD contractors and subcontractor supplying electronic parts or items containing electronic parts.

    Comment: One respondent noted that, while the rules on the elements of the Detection and Avoidance System and the Contractor Purchasing System have been finalized, both systems are dependent on the forthcoming rules on use of trusted suppliers (DFARS Case 2014-D005) and timely reporting (FAR Case 2013-002). The respondent was concerned that, when finalized, those rules may shape those policies and systems in ways not contemplated in this rulemaking. The respondent recommended that, where finalization of pending rules cause contractor or subcontractor systems to go out of alignment with any of the elements related to cost allowability herein, or their previously approved systems, DoD should adopt a “time-out” from compliance enforcement and allow contractors and subcontractors time to adjust those systems to any new or modified requirements impacting the safe harbor.

    Response: DFARS Case 2014-D005, although not yet finalized at the time the comments were submitted, has now been in effect since August 2, 2016. The system criterion in paragraph (c)(6) of the clause at DFARS 252.246-7007 already requires reporting of counterfeit electronic parts and suspect counterfeit electronic parts to GIDEP. Paragraph (c)(11) also requires a process for screening GIDEP reports to avoid the purchase or use of counterfeit electronic parts. Although the FAR case may provide some additional details, the primary purpose of the FAR Case 2013-002 is to expand the requirement for GIDEP reporting to agencies other than DoD and to encompass parts other than electronic parts.

    b. Obtain the Counterfeit Electronic Part in Accordance With Regulations

    Comment: One respondent commented on the sourcing of electronic parts as a condition of cost allowability. Using the terminology of the proposed rule published under DFARS Case 2014-D005, the respondent noted three categories of suppliers each with its own unique set of qualities and conditions needed to meet the conditions for safe harbor.

    The respondent was concerned about the meaning of the statement that the contractor is responsible for the authenticity of the parts, when buying from what is now termed a “contractor-approved” supplier. The respondent requested clarification and confirmation that the safe harbor condition based on acquiring parts in accordance with the DFARS 252.246-7008 clause will be broadly construed and available where contractors acquire from any of the categories of suppliers defined in the proposed version of the 252.246-7008 clause. The respondent was concerned that use of the terms “trustworthy” or “non-trusted” may be perceived to imply a standard inferior to that of “trusted supplier” and imply that use of such sources could prevent contractors from availing themselves of the safe harbor.

    Response: It is correct that the statute and the final rule under DFARS Case 2014-D005 provided for a tiered approach for sources of electronic parts, although the final rule no longer uses the terms “trusted supplier,” “trustworthy,” or “non-trusted supplier.”

    • Category 1: Electronic parts that are in production or currently available in stock. The contractor shall obtain the parts from the original manufacturer, their authorized suppliers, or from suppliers that obtain such parts exclusively from the original manufacturers of the parts or their authorized dealers.

    • Category 2: Electronic parts that are not in production and not currently available in stock. The contractor shall obtain parts from suppliers identified by the contractor as contractor-approved suppliers, subject to certain conditions.

    • Category 3: Electronic parts that are not in production and not available from any of the above sources; electronic parts from a subcontractor (other than the original manufacturer) that refuses to accept flowdown of 252.246-7008; or electronic parts that the contractor or subcontractor cannot confirm are new or that the electronic parts have not been comingled in supplier new production or stock with used, refurbished, reclaimed, or returned parts: The contractor may buy such electronic parts subject to certain conditions.

    Section 818(c)(3)(C) imposes, as one of the conditions for contractor identification and use of contractor-approved suppliers (category 2), the requirement that the contractor or subcontractor “assume responsibility for the authenticity of parts provided by such suppliers as provided in paragraph (2)” (i.e., section 818(c)(2), entitled “Contractor Responsibilities,” which states that covered contractors that supply electronic parts or products that include electronic parts are responsible for detecting and avoiding the use or inclusion of counterfeit electronic parts or suspect counterfeit electronic parts in such products and for any rework or corrective action that may be required to remedy the use or inclusion of such parts). The contractor assumes responsibility for the inspection, testing, and authentication in accordance with existing applicable standards, consistent with the requirements at DFARS 252.246-7008(c)(2) if the contractor cannot establish traceability from the original manufacturer for a specific electronic part.

    The safe harbor provision of the statute at section 818(c)(2)(B), as amended, does not exclude applicability to electronic parts acquired from any of the categories of sources, as long as the contractor complies with all of the conditions associated with that category. The allowability of the costs of any counterfeit electronic parts and any rework or corrective action that may be required to remedy the use or inclusion of such parts must be based upon an analysis of the facts of the case, in accordance with section 818(c)(2)(B), as amended, DFARS 231.205-71, 246.870-2, and the associated clauses at DFARS 252.246-7007 and 252.246-7008.

    Comment: One respondent recommended that “pending approval” be added to the definition of “trusted suppliers” and that contractor-designated trusted suppliers be assumed to be approved by the DoD officials until DoD notifies the designating contractor that the supplier is not approved. According to the respondent, this change to the regulations is necessary in order to prevent contractors and their suppliers from having costs relating to detection and remediation deemed unallowable because DoD officials have not conducted and completed the approval process for a contractor-approved supplier.

    Response: DoD approval of contractor-approved suppliers is the subject of DFARS Case 2016-D013, Amendments Related to Sources of Electronic Part, which was published in the Federal Register as a proposed rule on August 2, 2016. Although that rule is not yet finalized, the proposed rule stated explicitly that the contractor may proceed with the acquisition of electronic parts from a contractor-approved supplier unless notified otherwise by DoD.

    c. Discover the Counterfeit Electronic Part

    Comment: One respondent recommended that broadening the concept of “discovers” would be consistent with the underlying policy concerns. The respondent recommended that the word “discover” should also include the situation where a contractor reviews a GIDEP alert about a suspect counterfeit electronic part and determines that it has incorporated the part in its DoD products and makes a report.

    The respondent recommended replacing the word “discover” with “learns of and acts upon.” According to the respondent, a narrow definition of “discovers” could result in a “first to discover” race that would thwart the timely sharing of information. The respondent feared that entities might not take sufficient care to gather and analyze all of the necessary information in their haste to be the first to report.

    Response: Although the definition of “discover” frequently has the meaning of finding out something previously unknown, it also has the meaning of learning or becoming aware of something that the person making the “discovery” did not know about before. So, if a contractor became aware of a counterfeit electronic part on GIDEP and then took action with regard to its use of that part, this would fall within the meaning of “discover.” It would be outside the scope of the meaning of “discover” if the Government discovered that the contractor was using counterfeit electronic parts, and notified the contractor of that fact. To make the meaning clearer, DoD has substituted the words “becomes aware” for the word “discovers,” because this is the term used in section 818(c)(4), the paragraph to which section 818(c)(2)(B)(iii) refers, and is already used in DFARS 231.205-71(b)(3) and 252.246-7007(c)(6). The final rule adds clarifying language that the contractor may learn of the counterfeit electronic parts or suspect counterfeit electronic parts through inspection, testing, and authentication efforts of the contractor or its subcontractors; through a GIDEP alert; or by other means.

    d. Provide Timely Notice

    Comment: One respondent recommended it would be beneficial to use a central point of contact contracting officer for reporting. The respondent also recommended clarification as to which level of contractor in the supply chain must provide notice to the Government.

    Response: It is not feasible for the contractor to notify just one contracting officer, and expect that contracting officer to coordinate will all other contracting officers dealing with that contractor. It is the responsibility of the contractor to notify each contracting officer for each contract affected. However, the clause at DFARS 252.246-7007, Contractor Counterfeit Electronic Part Detection and Avoidance System, in compliance with section 818 paragraphs (c)(4) and (e), already requires that a counterfeit electronic part detection and avoidance system shall include risk-based policies and procedures that address reporting of counterfeit electronic parts and suspect counterfeit electronic parts. Reporting is required to the contracting officer and to GIDEP when the contractor becomes aware of, or has reason to suspect that, any electronic part or end item, component, part, or assembly containing electronic parts purchased by DoD, or purchased by a contractor for delivery to, or on behalf, of, DoD, contains counterfeit electronic parts or suspect counterfeit electronic parts. The notice required under this cost principle should be consistent with the statutory and regulatory required criterion for an approved system to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts. Therefore, the final rule requires notice to the cognizant contracting officer(s) and GIDEP (with limited exceptions).

    4. Process To Adjudicate Allowability

    Comment: One respondent stated the need to establish an effective process for contracting officers to be able to fairly and promptly adjudicate claims related to the safe harbor conditions.

    Response: The process for adjudicating the allowability of costs related to counterfeit electronic parts and suspect counterfeit electronic parts is no different than the process for adjudicating other potentially unallowable costs. If a contractor incurs costs related to counterfeit electronic parts or suspect counterfeit electronic parts, the contracting officer will check with the Defense Contract Management Agency to determine whether the contractor meets the criteria at DFARS 231.205-71(b). If the contracting officer determines that the costs are unallowable, the Defense Contract Audit Agency determines the amount of the unallowable costs.

    5. Editorial Correction

    Comment: One respondent noted that in proposed DFARS 231.205-71(b)(1) the word “electronic” was omitted in one place in the sentence “The contractor has an operational system to detect and avoid counterfeit parts and suspect counterfeit electronic parts . . . .”

    Response: The omission of the word “electronic” in this context was baseline DFARS, consistent with the original section 818 language. The statutory language was subsequently amended by section 885 of the NDAA for FY 2016 and has been corrected in the final rule.

    C. Other Changes

    The final rule—

    • Specifies at DFARS 231.205-71(b)(2) the cites of the DFARS regulations with which the contractor must comply, as published in the Federal Register on August 2, 2016, under DFARS Case 2014-D005; and

    • Replaces “notice” with “written notice” at DFARS 231.205-71(b)(3)(ii), for consistency with the statute.

    III. Applicability to Contracts at or Below the Simplified Acquisition Threshold (SAT) and for Commercial Items, Including Commercially Available Off-the-Shelf (COTS) Items

    This case does not add any new provisions or clauses or impact any existing provisions or clauses.

    IV. Executive Orders 12866 and 13563

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

    V. Regulatory Flexibility Act

    A final regulatory flexibility analysis (FRFA) has been prepared consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. The FRFA is summarized as follows:

    This final rule implements section 885(a) of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2016 (Pub. L. 114-92). The objective of this rule is to amend the allowability of costs for counterfeit parts or suspect counterfeit parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts. Such costs may be allowable if the parts were obtained by the contractor/subcontractor in accordance with DFARS clause 252.246-7008, Sources of Electronic Parts, and timely notice is provided to the Government.

    There were no significant issues raised by the public in response to the initial regulatory flexibility analysis.

    DoD is unable to estimate the number of small entities that will be impacted by this rule. This rule will apply to all DoD prime and subcontractors with cost contracts. This rule will only impact cost allowability if the contractor or subcontractor has complied with DFARS 246.870, but nevertheless acquired, used, or included counterfeit electronic parts or suspect counterfeit electronic parts in performance of a DoD contract or subcontract, and has learned of such parts and provided timely notification to the cognizant contracting officer(s) and the Government Industry Data Exchange Program (unless an exception applies).

    There is no change to the projected reporting, recordkeeping, or other compliance requirements associated with the rule.

    DoD has not identified any alternatives that are consistent with the stated objectives of the applicable statute. However, DoD notes that the impacts of this rule are expected to be beneficial, because it expands the allowability of costs for counterfeit parts or suspect counterfeit parts and the cost of rework or corrective action that may be required to remedy the use or inclusion of such parts.

    VI. Paperwork Reduction Act

    The rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

    List of Subjects in 48 CFR Part 231

    Government procurement.

    Jennifer L. Hawes, Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR part 231 is amended as follows:

    PART 231—CONTRACT COST PRINCIPLES AND PROCEDURES 1. The authority citation for 48 CFR part 231 continues to read as follows: Authority:

    41 U.S.C. 1303 and 48 CFR chapter 1.

    2. Revise section 231.205-71 to read as follows:
    231.205-71 Costs related to counterfeit electronic parts and suspect counterfeit electronic parts.

    (a) Scope. This section implements the requirements of section 818(c)(2), National Defense Authorization Act for Fiscal Year 2012 (Pub. L. 112-81), as modified by section 833, National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239), and section 885 of the National Defense Authorization Act for Fiscal Year 2016 (Pub. L. 114-92).

    (b) The costs of counterfeit electronic parts and suspect counterfeit electronic parts and the costs of rework or corrective action that may be required to remedy the use or inclusion of such parts are unallowable, unless—

    (1) The contractor has an operational system to detect and avoid counterfeit electronic parts and suspect counterfeit electronic parts that has been reviewed and approved by DoD pursuant to 244.303(b);

    (2) The counterfeit electronic parts or suspect counterfeit electronic parts are Government-furnished property as defined in FAR 45.101 or were obtained by the contractor in accordance with the clause at 252.246-7008, Sources of Electronic Parts; and

    (3) The contractor—

    (i) Becomes aware of the counterfeit electronic parts or suspect counterfeit electronic parts through inspection, testing, and authentication efforts of the contractor or its subcontractors; through a Government Industry Data Exchange Program (GIDEP) alert; or by other means; and

    (ii) Provides timely (i.e., within 60 days after the contractor becomes aware) written notice to—

    (A) The cognizant contracting officer(s); and

    (B) GIDEP (unless the contractor is a foreign corporation or partnership that does not have an office, place of business, or fiscal paying agent in the United States; or the counterfeit electronic part or suspect counterfeit electronic part is the subject of an on-going criminal investigation).

    [FR Doc. 2016-20475 Filed 8-29-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Chapter 2 [Docket DARS-2016-0001] RIN 0750-AI83 Defense Federal Acquisition Regulation Supplement: Instructions for the Wide Area WorkFlow Reparable Receiving Report (DFARS Case 2016-D004) AGENCY:

    Defense Acquisition Regulations System, Department of Defense (DoD).

    ACTION:

    Final rule.

    SUMMARY:

    DoD is amending the Defense Federal Acquisition Regulation Supplement (DFARS) to add instructions for utilizing the Wide Area WorkFlow Reparable Receiving Report.

    DATES:

    Effective September 29, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Mr. Tom Ruckdaschel, telephone 571-372-6088.

    SUPPLEMENTARY INFORMATION: I. Background

    DoD published a proposed rule in the Federal Register at 81 FR 17051 on March 25, 2016, to revise appendix F of the DFARS to add instructions for the use, preparation, and distribution of the Wide Area WorkFlow (WAWF) Reparable Receiving Report (RRR). One respondent submitted a public comment in response to the proposed rule.

    II. Discussion and Analysis

    DoD reviewed the public comment in the development of the final rule. A discussion of the comment received follows:

    A. Summary of Significant Changes From the Proposed Rule

    There were no significant changes made from the proposed rule.

    B. Analysis of Public Comment

    Comment: Consider removing or revising the requirement for dollars to be included on every receiving report (RR) in the WAWF iRAPT (Invoice, Receipt, Acceptance, and Property Transfer) application. Many scenarios occur in which it is not a viable option to list a dollar value on a RR such as nonseparately priced items or partial shipments where a value may not be assessed.

    Response: This comment is outside the scope of this rule. The requirement to record a unit price on the WAWF RRR is in accord with preexisting DFARS language.

    III. Applicability to Contracts at or Below the Simplified Acquisition Threshold and for Commercial Items, Including Commercially Available Off-the-Shelf Items

    This case does not add any new provisions or clauses or impact any existing provisions or clauses.

    IV. Executive Orders 12866 and 13563

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

    V. Regulatory Flexibility Act

    DoD does not expect this rule to have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq. However, a final regulatory flexibility analysis has been performed and is summarized as follows:

    This rule amends the Defense Federal Acquisition Regulation Supplement (DFARS) appendix F to add the instructions for utilizing the Wide Area WorkFlow (WAWF) Reparable Receiving Report (RRR).

    The objective of the rule is to provide the instruction for the use, preparation, and distribution of WAWF RRR that has been created to differentiate between the deliveries of new Government assets (new procurements) and the return of Government property that are repaired or overhauled. This rule improves reporting efficiency by eliminating manual intervention that is currently required to ensure accurate information flow between different Government property reporting systems.

    No significant issues were raised by the public comments in response to the initial regulatory flexibility analysis.

    The number of small entities affected is unknown. However, DoD expects this rule to have a positive economic impact on contractors, including small businesses, because of the improved efficiency due to electronic report submission.

    The projected recordkeeping and reporting is unchanged from current requirements, and only the method of submitting the reports for the return of Government property that has been repaired or overhauled has changed. Preparation of these records requires clerical and analytical skills to create the electronic documents in the WAWF system.

    There are no known significant alternatives to the rule. The impact of this rule on small business is not expected to be significant.

    VI. Paperwork Reduction Act

    The rule contains information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35). However, these changes to the DFARS do not impose additional information collection requirements to the paperwork burden previously approved under OMB Control Number 0704-0248 entitled “Material Inspection and Receiving Report”. The projected recordkeeping and reporting is unchanged from current requirements, and only the method of submitting the reports for the return of Government property that has been repaired or overhauled has changed.

    List of Subjects in 48 CFR Appendix F to Chapter 2

    Government procurement.

    Jennifer L. Hawes, Editor, Defense Acquisition Regulations System.

    Therefore, 48 CFR chapter 2, subchapter I, is amended in appendix F as follows:

    CHAPTER 2—DEFENSE ACQUISITION REGULATIONS SYSTEM, DEPARTMENT OF DEFENSE 1. The authority citation for appendix F to chapter 2 continues to read as follows: Authority:

    41 U.S.C. 1303 and 48 CFR chapter 1.

    2. Amend appendix F to chapter 2 by: a. In section F-101, paragraph (a)— i. Removing “(WAWF) Receiving Report” and adding “(WAWF) Receiving Report (RR), WAWF Reparable Receiving Report (WAWF RRR)” in its place; and ii. Adding a sentence at the end of the paragraph; b. In section F-103— i. In paragraphs (a) introductory text, (a)(6), (b) introductory text, and (c), removing “WAWF RR” and adding “WAWF RR, WAWF RRR,” in each place; ii. In paragraph (e), removing “WAWF RR provides” and adding “WAWF RR and WAWF RRR provide” in its place; and iii. Adding paragraph (e)(3); c. In section F-104, redesignating paragraph (b) as paragraph (c) and adding a new paragraph (b); d. Revising the part 3 heading; e. In section F-301, revising paragraph (b)(15)(ii) and paragraph (b)(18) introductory text; f. In section F-303, removing “WAWF RR” and adding “WAWF RR or WAWF RRR” in its place; g. Revising section F-304; and h. In section F-306, revising the introductory text and paragraph (a).

    The additions and revisions read as follows:

    Appendix F to Chapter 2—Material Inspection and Receiving Report F-101 General.

    (a) * * * The WAWF RRR is the electronic equivalent of the DD Form 250 for repair, maintenance, or overhaul of Government-furnished property.

    F-103 Use.

    (e) * * *

    (3) Reporting of Government-furnished property, when the clause at DFARS 252.211-7007, Reporting of Government-Furnished Property, is used in the contract, use of the WAWF RRR will capture the shipment of Government-furnished property items after acceptance of repair services and forward the data to the IUID registry. WAWF is the only way a contractor can report the transfer of Government-furnished property items in the IUID registry.

    F-104 Application.

    (a) * * *

    (b) WAWF RRR or DD Form 250. Use as in paragraph (a) of this section for delivery of services for repair, overhaul, or maintenance.

    PART 3—PREPARATION OF THE WIDE AREA WORKFLOW (WAWF) RECEIVING REPORT (RR), WAWF REPARABLE RECEIVING REPORT (WAWF RRR), AND WAWF ENERGY RR F-301 Preparation Instructions.

    (b) * * *

    (15) * * *

    (ii) For service line items, select SV for “SERVICE” in the type field followed by as short a description as is possible in the description field. Some examples of service line items are maintenance, repair, alteration, rehabilitation, engineering, research, development, training, and testing.

    (A) For WAWF RRRs, the “Ship To” code is the DoDAAC, MAPAC, or CAGE code from the contract or shipping instructions.

    (B) For service line items not using a WAWF RRR, the “Ship To” code and the “Unit” shall be filled out. The “Ship To” code is the destination Service Acceptor Code for WAWF. If source inspected and accepted, enter the service performance location as the “Ship To” code.

    (18) Unit Price. The contractor shall enter unit prices on all WAWF RR copies. When using the WAWF RRR, the unit price is the price of the repair, overhaul, or maintenance service from the contract.

    F-304 Correction instructions.

    Functionality for correcting a WAWF RR or WAWF RRR is available for Defense Contract Management Agency administered contracts paid using the Mechanization of Contract Administration Services system with source acceptance. Preparation instructions and training for corrections is available at https://wawftraining.eb.mil. The instructions are part of the Vendor Training section.

    F-306 Packing list instructions.

    Contractors may also use a WAWF processed RR, including the WAWF RRR, as a packing list. WAWF provides options to print the RR. These printed RRs may also be used if a signed copy is required.

    (a) WAWF provides a print capability for its RR. The WAWF printed RR can be identified by its distinctive format and by the text title at the top of each printed page “Material Inspection and Receiving Report in accordance with DFARS Appendix F. Paper DD Form 250 is usable in lieu of this document on an exception basis.” (See DFARS 252.232-7003(c)). This printed copy can be used as a packing list. If needed, the signature can be verified by reviewing the signed RR in WAWF.

    [FR Doc. 2016-20474 Filed 8-29-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 622 [Docket No. 140501394-5279-02] RIN 0648-XE830 Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; 2016 Commercial Accountability Measures and Closure for Blueline Tilefish in the South Atlantic Region AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Temporary rule; closure.

    SUMMARY:

    NMFS implements accountability measures (AMs) for commercial blueline tilefish in the exclusive economic zone (EEZ) of the South Atlantic. Commercial landings for blueline tilefish are projected to reach the commercial annual catch limit (ACL) by August 30, 2016. Therefore, NMFS is closing the commercial sector for blueline tilefish in the South Atlantic EEZ at 12:01 a.m., local time, August 30, 2016, and it will remain closed until the start of the next fishing year on January 1, 2017. This closure is necessary to protect the blueline tilefish resource.

    DATES:

    This rule is effective at 12:01 a.m., local time, August 30, 2016, until 12:01 a.m., local time, January 1, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Mary Vara, NMFS Southeast Regional Office, telephone: 727-824-5305, email: [email protected]

    SUPPLEMENTARY INFORMATION:

    The snapper-grouper fishery of the South Atlantic includes blueline tilefish and is managed under the Fishery Management Plan for the Snapper-Grouper Fishery of the South Atlantic Region (FMP). The South Atlantic Fishery Management Council and NMFS prepared the FMP, and the FMP is implemented under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act) by regulations at 50 CFR part 622.

    In Regulatory Amendment 25 to the FMP, NMFS implemented management measures for blueline tilefish that included increasing the commercial ACL from 26,766 lb (12,141 kg) to 87,521 lb (39,699 kg), round weight (81 FR 45245, July 13, 2016).

    NMFS is required to close the commercial sector for blueline tilefish when the commercial ACL is reached, or is projected to be reached, by filing a notification to that effect with the Office of the Federal Register, as specified in 50 CFR 622.193(z)(1)(i). NMFS has projected that the commercial ACL for South Atlantic blueline tilefish will be reached by August 30, 2016. Accordingly, the commercial sector for South Atlantic blueline tilefish is closed effective at 12:01 a.m., local time, August 30, 2016, until 12:01 a.m., local time, January 1, 2017.

    The operator of a vessel with a valid Federal commercial vessel permit for South Atlantic snapper-grouper having blueline tilefish on board must have landed and bartered, traded, or sold such blueline tilefish prior to August 30, 2016. During the commercial closure, all sale or purchase of blueline tilefish is prohibited. The harvest or possession of blueline tilefish in or from the South Atlantic EEZ is limited to the bag and possession limits specified in 50 CFR 622.187(b)(2) and (c)(1), respectively, while the recreational sector for blueline tilefish is open. These bag and possession limits apply in the South Atlantic on board a vessel with a valid Federal commercial or charter vessel/headboat permit for South Atlantic snapper-grouper, and apply to the harvest of blueline tilefish in both state and Federal waters.

    Classification

    The Regional Administrator for the NMFS Southeast Region has determined this temporary rule is necessary for the conservation and management of blueline tilefish and the South Atlantic snapper-grouper fishery and is consistent with the Magnuson-Stevens Act and other applicable laws.

    This action is taken under 50 CFR 622.193(z)(1)(i) and is exempt from review under Executive Order 12866.

    These measures are exempt from the procedures of the Regulatory Flexibility Act because the temporary rule is issued without opportunity for prior notice and comment.

    This action responds to the best scientific information available. The Assistant Administrator for NOAA Fisheries (AA) finds that the need to immediately implement this action to close the commercial sector for blueline tilefish constitutes good cause to waive the requirements to provide prior notice and opportunity for public comment pursuant to the authority set forth in 5 U.S.C. 553(b)(B), as such prior notice and opportunity for public comment are unnecessary and contrary to the public interest. Such procedures are unnecessary because the regulations at 50 CFR 622.193(z)(1)(i) have already been subject to notice and comment, and all that remains is to notify the public of the closure. Prior notice and opportunity for public comment are contrary to the public interest because there is a need to immediately implement this action to protect blueline tilefish, since the capacity of the fishing fleet allows for rapid harvest of the commercial ACL. Prior notice and opportunity for public comment would require time and would potentially result in a harvest well in excess of the established commercial ACL.

    For the aforementioned reasons, the AA also finds good cause to waive the 30-day delay in the effectiveness of this action under 5 U.S.C. 553(d)(3).

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: August 25, 2016. Emily H. Menashes, Acting Director, Office of Sustainable Fisheries, National Marine Fisheries Service.
    [FR Doc. 2016-20847 Filed 8-25-16; 4:15 pm] BILLING CODE 3510-22-P
    81 168 Tuesday, August 30, 2016 Proposed Rules OFFICE OF PERSONNEL MANAGEMENT 5 CFR Part 890 RIN 3206-AN33 Federal Employees Health Benefits (FEHB) Program: FEHB Employee Premium Contributions for Employees in Leave Without Pay or Other Nonpay Status AGENCY:

    U.S. Office of Personnel Management.

    ACTION:

    Notice of proposed rulemaking.

    SUMMARY:

    The United States Office of Personnel Management (OPM) is issuing a proposed rule to provide flexibility to agencies regarding payment for Federal Employees Health Benefits (FEHB) coverage for employees entering leave without pay (LWOP) or any other type of nonpay status, except when nonpay is as a result of a lapse of appropriations. The regulation also affects employees who have insufficient pay to cover their premium contribution. Under current regulations, a Federal agency pays the employee's share and the Government's share of FEHB premiums if an employee in LWOP or other nonpay status elects to continue coverage while in LWOP or other nonpay status and agrees to repay the agency (referred to interchangeably as “employing office”) for their employee share upon return to employment for up to 365 days. In other words, the agency must allow an employee to incur a debt for the employee contribution to premium. This outlay of funds may result in an agency incurring a significant amount of debt. This proposed rule would provide an agency with the flexibility to require that all of its employees in LWOP or other nonpay status, except as a result of lapse of appropriations, pay their employee share for FEHB coverage directly to the agency and keep the payments current, if those employees elect to continue FEHB enrollment. Under 5 U.S.C. 8906(e), if an employee in LWOP status chooses to continue FEHB enrollment, the employee and Government contributions shall be paid on a current basis; and, if necessary, the agency shall approve advance payment of a portion of basic pay sufficient to cover the employee contribution. The agency will then recover the amount that it advanced from the employee upon his or her return to employment.

    Under current regulations employees in LWOP or other nonpay status can elect to make premium payments directly to an agency and keep payments current. Alternatively, employees in these circumstances may elect not to pay premiums directly on a current basis and can incur a debt such that their employing office advances the payments to cover their premiums. The employee agrees that upon his or her return to employment, or upon pay becoming sufficient, the employing office will deduct, in addition to the current pay period's premium, the accrued unpaid premiums from the employee's salary until the debt is recovered. Under this proposed rule, an agency may choose to require that an employee pay premiums directly to the agency on a current basis if the agency makes a determination that all employees in non-pay or insufficient pay status must pay premiums currently. The proposed rule also specifies the procedures for disenrollment for nonpayment of premiums.

    DATES:

    Comments are due on or before October 31, 2016.

    ADDRESSES:

    Send written comments to Julia Elam, Planning and Policy Analysis, U.S. Office of Personnel Management, Room 4316, 1900 E Street NW., Washington, DC 20415. You may also submit comments using the Federal eRulemaking Portal: http://www.regulations.gov/. Follow the instructions for submitting comments.

    FOR FURTHER INFORMATION CONTACT:

    Julia Elam at (202) 606-0004.

    SUPPLEMENTARY INFORMATION:

    OPM is revising the options and procedures that employing offices may use when an employee elects to continue FEHB coverage in leave without pay (LWOP) or other nonpay status, except as a result of lapse of appropriations, when the employee's pay is insufficient to cover premiums. Under 5 U.S.C. 8906(e)(1)(a), an employee enrolled in a health benefits plan who is placed in a leave without pay or other nonpay status may have his coverage and the coverage of members of his family continued under the plan for not to exceed one year. According to the statute, the agency is responsible for ensuring the employee and Government contributions are paid to the Employees Health Benefits Fund on a current basis; and if necessary, the head of the agency may approve advance payment of employee premiums, which the agency can later recover from the employee. The employee may alternatively elect to terminate FEHB enrollment. This proposed rule does not affect agencies' advancing payment of health insurance premiums for employees with the following categories of qualifying LWOP, which includes the following: Family and Medical Leave Act, performance of duty in the uniformed services under the Uniformed Services Employment and Reemployment Rights Act of 1994, 38 U.S.C. 4301 et seq., receiving medical treatment under Executive Order 5396 (Jul. 7 1930), and periods during which workers compensation is received under the Federal Employees Compensation Act, 5 U.S.C. chapter 81. We solicit comments on the exemption of categories of employees in LWOP from this proposed rule.

    Under current regulations at 5 CFR 890.502(b), an employing office must inform the employee about available health benefits choices as soon as it becomes aware that an employee's premium payments cannot be made because he or she will be, or already is in a LWOP or other nonpay status, or the employee's pay is insufficient to cover premium. The employing office must give the employee written notice of the options to terminate coverage or continue coverage with either the direct pay or the advance payment option. The employee then must elect in writing to either continue health benefits coverage or terminate it, while in LWOP or other nonpay status or pay is insufficient to cover premiums. If the employee's coverage is continued, the employee may pay the employee share of the premium directly to the agency, or the employee may opt for the agency to advance payment of the employee portion of the premium and agree to repay the premiums to the agency upon returning to employment or upon pay becoming sufficient. Accordingly, there is the possibility that the employee will incur a debt to the agency if the employee chooses to continue coverage and receive an advanced payment and does not return to work or is, for some reason, unable to repay the premium amount. Under § 890.502(b)(2)(ii), the employing office can pay the employee's contributions and recover the amount of accrued unpaid premiums as a debt to the Federal Government upon the employee's return to employment or when the employee's pay becomes sufficient.

    Under this proposed regulation, each agency would make the determination of whether its employees in LWOP or other nonpay status would be required to pay the employee share of premiums directly to the agency on a current basis, or whether it is necessary, within the meaning of 5 U.S.C. 8906(e)(1)(B), for the agency to approve advance payment of the employee share of the premium. The agency would make the determination for all its affected employees at least once every 2 years. OPM is proposing this change to complement the FEHB Modification of Eligibility final regulation (79 FR 62325, published on October 17, 2014) which allows generally for certain temporary, intermittent and seasonal employees to enroll in the FEHB Program if they are expected to work at least 130 hours per month for at least 90 days. OPM recognizes that the recent expansion of eligibility for FEHB coverage may impact an agency's budget due to the required FEHB Government health benefit contributions for newly eligible employees who elect to participate in FEHB coverage and go into LWOP or other nonpay status based on the intermittent nature of the work performed.

    OPM proposes for § 890.502(b) to establish that an agency have the discretion to determine whether it is necessary for employees in LWOP or other nonpay status to be advanced a portion of basic pay sufficient to pay current employee contribution to premium, or whether the employees must be required to pay the employee contribution of the FEHB premium currently to the agency. The determination made by the agency must apply to all employees in non-pay or insufficient pay status, and it cannot be made on a case-by-case basis. When assessing whether it is necessary to pay advanced employee contributions for premiums, the regulation provides that an agency shall balance the needs of the agency, including available financial resources and ease of operation, with those of its employees, including typical job series and pay grades and access to direct payment methods. Agencies should also consider that if they do advance employee contributions for premiums, these employees will incur a debt which may not occur if the employee had an option to pay premiums directly to the agency. We are seeking comment on these and other factors agencies should utilize to make this determination. The agency may reassess its determination every one or two years and provide notification to all employees. An agency may default to its original determination and is not required to make a new determination at the time of reassessment. If an agency chooses to require its employees in these circumstances to make direct premium contributions on a current basis, it must provide written notice to the affected employees. This section also explains that an agency may choose the other option to exercise its discretion to approve advance payment of the employee portion of the premium while its employees are in LWOP or other nonpay status. This would be a change to current regulations at § 890.502(b)(2)(ii), which presently provides that an employee may choose this option if he or she does not does not wish to pay the premium directly to the agency and keep the payments current.

    OPM proposes for § 890.502(c)(2) to establish procedures for terminating enrollment for employees in LWOP or nonpay status that fail to directly pay premiums currently. The regulation also proposes notice requirements for the employee to receive regarding termination of enrollment.

    Under this proposed regulation, an employee that is in LWOP or other nonpay status or has insufficient pay to cover his or her share of FEHB premiums will have his or her enrollment cancelled if he or she has signed an agreement to directly pay premiums on a current basis and fails to make these payments currently, or enrollment terminated if the employee does not return the written notice. The proposed regulation gives an employee the opportunity to seek reinstatement from the agency if he or she can show they were prevented from paying premiums, or from returning the written notice, by circumstances beyond their control. The employee must describe the circumstances that prevented him or her from making a payment or returning the notice within 31 days after receiving notice of disenrollment. Under this proposal, termination of an enrollment for failure to return a written notice entitles the employee to a 31-day temporary extension of coverage and opportunity to convert to an individual policy, while failure to pay premiums after electing to continue FEHB enrollment is considered a cancellation. OPM is seeking comments on the implementation of this proposed rule for employees currently on LWOP or other nonpay status in which pay is insufficient to cover the employee share of FEHB premiums. OPM proposes making the rule effective for employees who enter into LWOP or other nonpay status after the date of the rule and not affecting employees currently on LWOP or other nonpay status.

    Regulatory Impact Analysis

    OPM has examined the impact of this proposed rule as required by Executive Order 12866 and Executive Order 13563, which directs agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public, health, and safety effects, distributive impacts, and equity). A regulatory impact analysis must be prepared for major rules with economically significant effects of $100 million or more in any one year. This rule is not considered a major rule because there will be a minimal impact on costs to Federal agencies.

    Regulatory Flexibility Act

    I certify that this regulation will not have a significant economic impact on a substantial number of small entities because the regulation only affects health insurance benefits of Federal employees and annuitants.

    Regulatory Review

    This rule has been reviewed by the Office of Management and Budget in accordance with Executive Orders 13563 and 12866.

    Federalism

    We have examined this rule in accordance with Executive Order 13132, Federalism, and have determined that this rule restates existing rights, roles and responsibilities of State, local, or tribal governments.

    List of Subjects on 5 CFR Part 890

    Administrative practice and procedure, Government employees, Health insurance.

    U.S. Office of Personnel Management. Beth F. Cobert, Acting Director.

    For the reasons set forth in the preamble, the Office of Personnel Management proposes to amend 5 CFR part 890 as follows:

    PART 890—FEDERAL EMPLOYEES HEALTH BENEFITS PROGRAM 1. The authority citation for part 890 continues to read as follows: Authority:

    5 U.S.C. 8913; Sec. 890.301 also issued under sec. 311 of Pub. L. 111-03, 123 Stat. 64; Sec. 890.111 also issued under section 1622(b) of Pub. L. 104-106, 110 Stat. 521; Sec. 890.112 also issued under section 1 of Pub. L. 110-279, 122 Stat. 2604; 5 U.S.C. 8913; Sec. 890.803 also issued under 50 U.S.C. 403p, 22 U.S.C. 4069c and 4069c-1; subpart L also issued under sec. 599C of 101, 104 Stat. 2064, as amended; Sec. 890.102 also issued under sections 11202(f),11232(e), 11246(b) and (c) of Pub. L. 105-33, 111 Stat. 251; and section 721 of Pub. L. 105-261, 112 Stat. 2061.

    Subpart E—Contributions and Withholdings 2. In § 890.502: a. Redesignate paragraphs (b) through (f) as paragraphs (c) through (g). b. Add new paragraph (b). c. Revise newly redesignated paragraph (c).

    The addition and revision read as follows:

    § 890.502 Withholdings, contributions, LWOP, premiums, and direct premium payment.

    (b) Agency flexibility to require direct payment of employee premiums on a current basis. An agency may require all employees that enter leave without pay (LWOP) or other nonpay status except for as a result of lapse of appropriations, whose pay is insufficient to cover premium, pay their employee premium contributions directly to the agency on a current basis or; if necessary, the agency may elect to provide advance payment of the employee portion of premium for all employees in these circumstances. In determining whether it is necessary to pay employee contributions for premiums, an agency shall balance the needs of the agency, including available financial resources and ease of operation, with those of its employees, including typical job series and pay grades and access to direct payment methods. The agency may reassess its policy decision every one or two years and should provide notification to all its employees. An agency must choose one of these two options for all employees that enter non-pay status or whose pay is insufficient to cover premium, except for certain qualifying LWOP categories.

    (1) For purposes of this paragraph (b), qualifying LWOP categories are exempt from an agency determination. Regardless of the agency's determination under paragraph (b), an agency shall advance payment for employee premiums for employees utilizing the following categories of LWOP: For purposes of the Family and Medical Leave Act, for performance of duty in the uniformed services under the Uniformed Services Employment and Reemployment Rights Act of 1994, 38 U.S.C. 4301 et seq., for receiving medical treatment under Executive Order 5396 (Jul. 7 1930), and for periods during which workers compensation is received under the Federal Employees Compensation Act, 5 U.S.C. chapter 81.

    (2) If an employing office requires an employee to pay the employee share of premium contributions directly to the agency on a current basis for the period during which an employee specifies he or she will be in LWOP or other nonpay status, the employing office must provide the employee written notice and an agreement that he or she will be required to pay premiums directly to the agency on a current basis by following the procedures as outlined in paragraphs (c)(2) of this section. The employee must sign the agreement if he or she chooses to continue coverage under an agency's election to require that payments be made directly on a current basis.

    (3) If necessary, an agency may elect to advance a portion of basic pay sufficient to pay current employee contributions to premium for employees entering LWOP or other nonpay status. If the agency so elects, the employing office must provide the employee written notice and an agreement that he or she will incur a debt to the extent of the advanced premiums, and will be required to repay the unpaid premiums from salary deduction, upon returning to pay status or upon payment becoming sufficient to cover premiums, until the debt is recovered in full, by following the procedures as outlined in paragraphs (c)(2) of this section.

    (c) Procedures when an employee enters a leave without pay (LWOP) or other nonpay status or pay is insufficient to cover premium. The employing office must tell the employee about available health benefits choices as soon as it becomes aware that an employee's premium payments cannot be made because he or she will be or is already in a leave without pay (LWOP) status or other type of nonpay status. (This does not apply when nonpay is as a result of a lapse of appropriations or employees have been furloughed. In these instances, the premiums will accumulate and be paid upon return to duty). The employing office must also tell the employee about the option available to them as determined by the agency or that the employee can elect to terminate enrollment when an employee's pay is not enough to cover the premiums.

    (1) The employing office must provide the employee written notice of the option available to them as determined by the agency and consequences as described in paragraphs (c) (2) (i) and (ii) of this section and will send a letter by first class mail if it cannot give it to the employee directly. If it mails the notice, it is deemed to be received within 5 days.

    (2) The employee must elect in writing to either continue their FEHB enrollment under the option that the employer has chosen or terminate it. (Exception: An employee who is subject to a court or administrative order as discussed in § 890.301(g)(3) cannot elect to terminate his or her enrollment as long as the court or administrative order is still in effect and the employee has at least one child identified in the order who is still eligible under the FEHB Program, unless the employee provides documentation that he or she has other coverage for the child(ren).) The employee may continue enrollment by returning a signed form to the employing office within 31 days after he or she receives the notice (45 days for an employee residing overseas). When an employee mails the signed form, its postmark will be used as the date the form is returned to the employing office. If an employee elects to continue their enrollment under the option that the employer has chosen, he or she must elect in writing the option that has been specified by the employing office for all employees as described in paragraph (b). The employee would agree to the following as specified by the employing office:

    (i) If the agency has elected to allow all employees to pay the premium directly to the agency and keep the payments current, the employee must agree to pay the premium directly, or;

    (ii) If the agency has elected to allow all employees to incur a debt as described in paragraph (b)(2) he or she must agree that upon returning to employment or upon pay becoming sufficient to cover the premiums, the employing office will deduct, in addition to the current pay period's premiums, an amount equal to the premiums for a pay period during which the employee was in a leave without pay (LWOP) or other nonpay status, or pay was not enough to cover premiums. The employing office will continue using this method to deduct the accrued unpaid premiums from salary until the debt is recovered in full. The employee must also agree that if he or she does not return to work or the employing office cannot recover the debt in full from salary, the employing office may recover the debt from whatever other sources it normally has available for recovery of a debt to the Federal Government.

    (iii) If an employee elects to terminate enrollment, the effective date of the termination is retroactive to the end of the last pay period in which the premium was withheld from pay.

    (3) If the employee does not return the signed form within the time period described in paragraph (c)(2) of this section, the employing office will terminate the enrollment and notify the employee in writing of the termination.

    (4) If an employee has not elected to terminate enrollment and is prevented by circumstances from returning a signed form indicating the employee elects to continue their enrollment under the option that the employer has chosen, the employee may request reinstatement.

    (i) If the employee is prevented by circumstances beyond his or her control from returning a signed form to the employing office within the time period described in paragraph (c)(2) of this section, he or she may write to the employing office and request reinstatement of the enrollment. The employee must describe the circumstances that prevented him or her from returning the form. The request for reinstatement must be made within 30 calendar days from the date the employing office gives the employee notice of the termination. The employing office will determine if the employee is eligible for reinstatement of coverage. When the determination is affirmative, the employing office will reinstate the enrollment of the employee retroactive to the date of termination. If the determination is negative, the employee may request a review of the decision from the employing office (see § 890.104).

    (ii) If the employee is subject to a court or administrative order as discussed in § 890.301(g)(3), the coverage cannot terminate unless the employee has provided documentation to the employing office that he or she has other coverage for the child or children, and the employing office has determined the coverage is appropriate, as discussed in 5 CFR 890.301(g)(3). If the employee does not return the signed form, the coverage will continue and the employee will incur a debt to the Federal Government, and the employing office will recover the amount of accrued unpaid premium as a debt under as discussed in paragraph(c)(2)(ii) of this section.

    (5) Terminations of enrollment under paragraphs (c)(2) and (3) of this section are retroactive to the last day of the last pay period in which the premium was withheld from pay. The employee and covered family members, if any, are entitled to the 31-day temporary extension of coverage and opportunity to convert to a non-group policy under § 890.401. An employee whose coverage is terminated under this paragraph may re-enroll upon his or her return to duty in pay status in a position in which the employee is eligible for coverage under this part.

    (6) If an employee signs and returns a form to the employing office stating that he or she will make premium payments directly to the agency and keep the payments current in accordance with paragraph (c)(2)(i) but fails to pay currently, as soon as it becomes aware of the nonpayment of premium, the employing office shall notify the employee that he or she has 31 days to make payments current or she or he will have coverage terminated retroactively to the day that follows the last day of the last pay period for which a current employee contribution was received.

    (i) If the employee does not make a payment within the 31 days of the notification, the employing office must terminate the employee's enrollment retroactively to the day that follows the last day of the last pay period for which a current employee contribution was received.

    (ii) Termination of an enrollment for failure to pay premiums after the employee had elected to continue coverage and to pay premiums currently under (c)(2)(i) and (c)(6), is considered a cancellation as described in § 890.401(a)(2) and the employee is not entitled to a 31-day temporary extension of coverage or opportunity to convert to an individual policy.

    (iii) If an employee that has enrollment terminated under this part was prevented by circumstances beyond his or her control from making payment within 31 days after receipt of the notice of termination, he or she may request reinstatement of coverage by writing to the employing office. Such a request must be filed within 30 calendar days from the date of termination and must be accompanied by verification that the employee was prevented by circumstances beyond his or her control from paying within the time limit. The verification must describe the circumstances that prevented him or her from making a payment within 31 days after receipt of the notice of termination. The employing office will determine if the employee is eligible for reinstatement of coverage; and, when the determination is affirmative, notify the carrier of the decision. The notice must set forth the findings on which the decision was based. If the employing office determines that the employee was prevented from making payments current within the timeframe due to circumstances beyond his or her control, the employee's enrollment will be reinstated retroactive to the date of termination.

    (iv) An employee whose coverage is terminated under paragraph (c)(6) may enroll upon his or her return to duty in pay status in a position in which the employee is eligible for coverage.

    [FR Doc. 2016-20565 Filed 8-29-16; 8:45 am] BILLING CODE 6325-63-P
    DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 205 [Document Number AMS-NOP-16-0069; NOP-16-08] National Organic Program: Notice of Interim Instruction on Material Review AGENCY:

    Agricultural Marketing Service, USDA.

    ACTION:

    Notice of availability of interim instruction with request for comments.

    SUMMARY:

    The Agricultural Marketing Service (AMS) is announcing the availability of an interim instruction document intended for use by accredited certifying agents. The interim instruction document is entitled: NOP 3012: Material Review. This instruction specifies the criteria and process that USDA accredited organic certifying agents (certifiers) must follow when approving substances for use in organic production and handling. This instruction is directed at certifiers, who must meet certain terms and conditions as part of their accreditation. The AMS invites interested parties to submit comments about this instruction document.

    DATES:

    To ensure that NOP considers your comment on this interim instruction before it begins work on the final version, submit written comments on the interim instruction by October 31, 2016.

    ADDRESSES:

    Submit written requests for hard copies of this interim instruction to Dr. Paul Lewis, Standards Division, National Organic Program (NOP), USDA-AMS-NOP, 1400 Independence Ave. SW., Room 2646—So., Ag Stop 0268, Washington, DC 20250-0268. See the SUPPLEMENTARY INFORMATION section for electronic access to the interim instruction document.

    You may submit comments, identified by AMS-NOP-16-0069; NOP-16-08, by any of the following methods:

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

    Mail: Dr. Paul Lewis, Standards Division, National Organic Program, USDA-AMS-NOP, 1400 Independence Ave. SW., Room 2646—So., Ag Stop 0268, Washington, DC 20250-0268.

    Instructions: Written comments responding to this request should be identified with the document number AMS-NOP-16-0069; NOP-16-08. You should clearly indicate your position and the reasons supporting your position. If you are suggesting changes to the interim instruction document, you should include recommended language changes, as appropriate, along with any relevant supporting documentation.

    USDA intends to make available all comments, including names and addresses when provided, regardless of submission procedure used, on www.regulations.gov and at USDA, AMS, NOP, Room 2646—South building, 1400 Independence Ave. SW., Washington, DC, from 9 a.m. to noon and from 1 to 4 p.m., Monday through Friday (except official Federal holidays). Persons wanting to visit the USDA South building to view comments from the public to this notice are requested to make an appointment by calling (202) 720-3252.

    FOR FURTHER INFORMATION CONTACT:

    Dr. Paul Lewis, Standards Director, National Organic Program (NOP), USDA-AMS-NOP, 1400 Independence Ave. SW., Room 2646—So., Ag Stop 0268, Washington, DC 20250-0268; Telephone: (202) 720-3252; Fax: (202) 205-7808; Email: [email protected]; or visit the NOP Web site at: www.ams.usda.gov/nop.

    SUPPLEMENTARY INFORMATION:

    I. Background

    This interim instruction specifies the criteria and process that accredited certifying agents (certifiers) must follow when approving substances for use in organic production and handling. This instruction is directed at certifiers, who must meet certain terms and conditions as part of their accreditation (see 7 CFR 205.501(a)(21)).

    The instruction defines the term Material Review Organization (MRO) and materials, and describes the USDA organic regulations as they relate to materials reviews. The instruction describes the policy that all certifiers must review all materials used by organic producers and handlers for compliance with the USDA organic regulations, and outlines options that certifiers have for determining whether materials may be used in organic production or handling under the USDA organic regulations.

    The instruction also outlines certifier requirements for maintaining documentation, making synthetic vs. nonsynthetic or agricultural vs. nonagricultural determinations; demonstrating appropriate education, training, and experience levels for personnel conducting material reviews; and creating clear written protocols and procedures related to materials reviews. This instruction also outlines the process that occurs when different certifying agents and MROs reach different conclusions on whether a product complies with the USDA organic regulations.

    A notice of availability of the final instruction on this topic will be issued upon review of comments and final approval of the document. Upon final approval, this instruction will be available in “The Program Handbook: Guidance and Instructions for Accredited Certifying Agents (ACAs) and Certified Operations”. This Handbook provides those who own, manage, or certify organic operations with guidance and instructions that can assist them in complying with the USDA organic regulations. The current edition of the Program Handbook is available online at http://www.ams.usda.gov/rules-regulations/organic.

    II. Electronic Access

    Persons with access to Internet may obtain the interim instruction at either NOP's Web site at http://www.ams.usda.gov/rules-regulations/organic or http://www.regulations.gov. Requests for hard copies of the interim instruction document can be obtained by submitting a written request to the mailing address listed in the ADDRESSES section of this Notice.

    Authority:

    7 U.S.C. 6501-6522.

    Dated: August 25, 2016. Elanor Starmer, Administrator, Agricultural Marketing Service.
    [FR Doc. 2016-20806 Filed 8-29-16; 8:45 am] BILLING CODE 3410-02-P
    DEPARTMENT OF AGRICULTURE Animal and Plant Health Inspection Service 7 CFR Part 319 [Docket No. APHIS-2015-0098] RIN 0579-AE27 Importation of Fresh Persimmon With Calyxes From Japan Into the United States AGENCY:

    Animal and Plant Health Inspection Service, USDA.

    ACTION:

    Proposed rule.

    SUMMARY:

    We are proposing to amend the regulations concerning the importation of fruits and vegetables to allow the importation of fresh persimmon with calyxes from Japan into the United States. As a condition of entry, the persimmons would have to be produced in accordance with a systems approach that would include requirements for orchard certification, orchard pest control, post-harvest safeguards, fruit culling, traceback, and sampling. The persimmons would also have to be accompanied by a phytosanitary certificate with an additional declaration stating that they were produced under, and meet all the components of, the agreed upon systems approach and were inspected and found to be free of quarantine pests in accordance with the proposed requirements. This action would allow the importation of fresh persimmons with calyxes from Japan while continuing to protect against the introduction of plant pests into the United States.

    DATES:

    We will consider all comments that we receive on or before October 31, 2016.

    ADDRESSES:

    You may submit comments by either of the following methods:

    Federal eRulemaking Portal: Go to http://www.regulations.gov/#!docketDetail;D=APHIS-2015-0098.

    Postal Mail/Commercial Delivery: Send your comment to Docket No. APHIS-2015-0098, 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-2015-0098 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:

    Mr. David B. Lamb, Senior Regulatory Policy Specialist, IRM, PPQ, APHIS, 4700 River Road, Unit 133, Riverdale, MD 20737-1231; (301) 851-2103.

    SUPPLEMENTARY INFORMATION: Background

    The regulations in “Subpart—Fruits and Vegetables” (7 CFR 319.56-1 through 319.56-75, referred to below as the regulations) prohibit or restrict the importation of fruits and vegetables into the United States from certain parts of the world to prevent the introduction and dissemination of plant pests that are new to or not widely distributed within the United States.

    The national plant protection organization (NPPO) of Japan has requested that the Animal and Plant Health Inspection Service (APHIS) amend the regulations to allow fresh persimmons (Diospyros kaki Thunb.) with calyxes from Japan to be imported into the United States. As part of our evaluation of Japan's request, we prepared a pest risk assessment (PRA) and a risk management document (RMD). Copies of the PRA and the RMD may be obtained from the person listed under FOR FURTHER INFORMATION CONTACT or viewed on the Regulations.gov Web site (see ADDRESSES above for instructions for accessing Regulations.gov).

    The PRA, titled “Importation of Persimmon, Diospyros kaki Thunb., as Fresh Fruit with Calyxes from Japan into the United States,” (January 3, 2013) evaluates the risks associated with the importation of fresh persimmons from Japan into the United States. The RMD relies upon the findings of the PRA to determine the phytosanitary measures necessary to ensure the safe importation into the United States of fresh persimmons from Japan.

    The PRA identified 19 pests of quarantine significance present in Japan that could be introduced into the United States through the importation of fresh persimmons. They are:

    Arthropods:

    • A mite, Tenuipalpus zhizhilashviliae (Reck);

    • The moths Conogethes puntiferalis (Guenée), Homonopsis illotana (Kennel), Lobesia aeolopa (Meyrick), and Stathmopoda masinissa (Meyrick);

    • The mealybugs Crisicoccus matsumotoi (Siraiwa) and Pseudococcus cryptus (Hempel); and

    • The thrips Ponticulothrips diospyrosi (Haga & Okajima), Scirtothrips dorsalis (Hood), and Thrips coloratus (Schmutz).

    Fungi:

    Adisciso kaki Yamamoto;

    Colletotrichum horii B. Weir & P.R. Johnst;

    Cryptosporiopsis kaki (Hara) Weinlm;

    Mycosphaerella nawae Hiura & Ikata;

    Pestalotia diospyri Syd. and P. Syd.;

    Pestalotiopsis acacia (Thumen) Yokoyama & Kaneko;

    Pestalotiopsis crassiuscula Steyaert;

    Phoma kakivora Hara; and

    Phoma loti Cooke.

    A quarantine pest is defined in § 319.56-2 of the regulations as a pest of potential economic importance to the area endangered thereby and not yet present there, or present but not widely distributed and being officially controlled. Potential plant pest risks associated with the importation of fresh persimmons from Japan into the United States were determined by estimating the consequences and likelihood of introduction of quarantine pests into the United States and ranking the risk potential as high, medium, or low. The PRA determined that 6 of the 19 pests—C. punctiferalis, H. illotana, L. aeolopa, P. cryptus, S. dorsalis, and P. diospyri—pose a high risk of following the pathway of persimmons from Japan into the United States and having negative effects on U.S. agriculture. The remaining pests were rated as having a medium risk potential.

    Based on the conclusions of the PRA and the RMD, we have determined that measures beyond standard port of arrival inspection are required to mitigate the risks posed by these plant pests. Therefore, we are proposing to allow the importation of persimmons with calyxes from Japan into the United States subject to a systems approach. The conditions in the systems approach that we are proposing are described below. These conditions would be added to the regulations in a new § 319.56-76.

    General Requirements

    Proposed paragraph (a)(1) of § 319.56-76 would require the NPPO of Japan to provide an operational workplan to APHIS that details the activities that the NPPO would, subject to APHIS' approval of the workplan, carry out to meet the requirements of proposed § 319.56-76. The operational workplan would have to include and describe in detail the quarantine pest survey intervals and other specific requirements in proposed § 319.56-76.

    An operational workplan is an agreement between APHIS' Plant Protection and Quarantine program, officials of the NPPO of a foreign government, and, when necessary, foreign commercial entities, that specifies in detail the phytosanitary measures that will be carried out to comply with our regulations governing the importation of a specific commodity. Operational workplans apply only to the signatory parties and establish detailed procedures and guidance for the day-to-day operations of specific import/export programs. Operational workplans also establish how specific phytosanitary issues are dealt with in the exporting country and make clear who is responsible for dealing with those issues. The implementation of a systems approach typically requires an operational workplan to be developed.

    Proposed paragraph (a)(2) would require persimmons from Japan to be imported only in commercial consignments. Produce grown commercially is less likely to be infested with plant pests than noncommercial consignments. Noncommercial consignments are more prone to infestations because the commodity is often ripe to overripe, could be of a variety with unknown susceptibility to pests, and is often grown with little or no pest control. Commercial consignments, as defined in § 319.56-2, are consignments that an inspector identifies as having been imported for sale and distribution. Such identification is based on a variety of indicators, including, but not limited to: Quantity of produce, type of packing, identification of grower or packinghouse on the packaging, and documents consigning the fruits or vegetables to a wholesaler or retailer.

    Place of Production Requirements

    Proposed paragraph (b)(1) would require that all places of production participating in the persimmon export program be approved by and registered with the NPPO of Japan.

    Paragraph (b)(2) would require the NPPO of Japan or its approved designee 1 to visit and inspect the places of production monthly beginning at blossom drop and continuing until the end of the shipping for quarantine pests. Appropriate pest controls must be applied in accordance with the operational workplan. APHIS may also monitor the places of production if necessary. If APHIS or the NPPO of Japan finds that a place of production is not complying with the requirements of the regulations, no fruit from the place of production will be eligible for export to the United States until APHIS and the NPPO of Japan conduct an investigation and appropriate remedial actions have been implemented.

    1 An approved designee is an entity with which the NPPO creates a formal agreement that allows that entity to certify that the appropriate procedures have been followed. The approved designee can be a contracted entity, a coalition of growers, or the growers themselves.

    Paragraph (b)(3) would require that harvested fruit must be transported to the packinghouse in containers marked to identify the place of production from which the consignment of fruit originated.

    Packinghouse Requirements

    We are proposing several requirements for packinghouse activities, which would be contained in paragraph (c) of proposed § 319.56-76. Paragraph (c)(1) would require that all packinghouses participating in the persimmon export program be approved by and registered with the NPPO of Japan.

    Paragraph (c)(2) would require that, during the time that the packinghouse is in use for exporting persimmons to the United States, the packinghouse would only be allowed to accept persimmons from approved and registered production sites and that the persimmons be segregated from other fruit. This requirement would prevent persimmons intended for export to the United States from being exposed to or mixed with persimmons or other fruit that are not produced according to the requirements of this section.

    Paragraph (c)(3) would require that all damaged, deformed, or diseased fruit be culled before or during packing and removed from the packinghouse. Fruit with broken or bruised skin or that is deformed is more susceptible to infestation by pests than undamaged fruit.

    Under paragraph (c)(4), the boxes or other containers in which the fruit is shipped would have to be marked to identify the orchard from which the consignment of fruit originated and the packinghouse where it was packed. Such box marking would facilitate traceback of a consignment of persimmon fruit to the packinghouse in which it was packed and place of production in the event that quarantine pests were discovered in the consignment after it has left the packinghouse.

    Paragraph (c)(5) would require the NPPO of Japan to monitor packinghouse operations to verify that the packinghouses are complying with the requirements of the regulations. If the NPPO of Japan finds that a packinghouse is not complying with the requirements of the regulations, no persimmon fruit from the packinghouse will be eligible for export to the United States until APHIS and the NPPO of Japan conduct an investigation and both agree that the pest risk has been mitigated.

    Sampling

    Paragraph (d) of proposed § 319.56-76 would require that a biometric sample of persimmon fruit, at a rate determined by APHIS, be inspected by the NPPO of Japan following post-harvest processing. The biometric sample would be visually inspected for signs of pests or disease, and a portion of the fruit, as determined by APHIS, would be cut open to detect internally feeding pests. If quarantine pests are found during sampling, the consignment of fruit would be prohibited from export to the United States.

    Phytosanitary Certificate

    To certify that the fresh persimmon fruit from Japan has been grown and packed in accordance with the requirements of proposed § 319.56-76, paragraph (e) would require each consignment of fruit to be accompanied by a phytosanitary certificate issued by the NPPO of Japan, with an additional declaration stating that they were produced under and meet all the components of the regulations and were inspected and found to be free of quarantine pests in accordance with the requirements.

    Executive Order 12866 and Regulatory Flexibility Act

    This proposed rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget. In accordance with the Regulatory Flexibility Act, we have analyzed the potential economic effects of this action on small entities. The analysis is summarized below. Copies of the full analysis are available by contacting the person listed under FOR FURTHER INFORMATION CONTACT or on the Regulations.gov Web site (see ADDRESSES above for instructions for accessing Regulations.gov).

    APHIS is proposing to amend the regulations to allow the importation of fresh persimmon (Diospyros kaki) into the United States from Japan subject to a systems approach. Most U.S. persimmon production takes place in California, where 2013 production totaled about 35,700 metric tons (MT) valued at about $40 million, triple the 2011 level of production. U.S. persimmon imports totaled 1,757 MT valued at about $3 million in 2014, $2 million of which were persimmons imported from Israel and $0.4 million from Spain. The United States is a net exporter of fresh persimmons, with the value of exports totaling about $6 million in 2014.

    Japan's persimmon acreage and production have been gradually declining over the last decade. A very small percentage of Japan's persimmons (about 0.2 percent of production) was exported in 2014, totaling about 578 MT and valued at $2.4 million. The average export price of fresh persimmons from Japan was $4.13/kilogram (kg) in 2014. This price is considerably higher than the average price paid by the United States for fresh persimmon imports, about $1.70/kg in 2014, and the average farm-gate price for persimmons produced in California, about $1.11/kg in 2013. The wide price differential between persimmons exported from Japan and persimmons imported or produced by the United States suggests that the competitiveness of persimmons from Japan in the U.S. market would be limited.

    The Small Business Administration's (SBA) small-entity standard for entities involved in fruit farming is $750,000 or less in annual receipts (NAICS 111339). It is probable that most or all U.S. persimmon producers are small businesses by the SBA standard. We expect any impact of the proposed rule for these entities would be minimal, given Japan's expected small share of the U.S. persimmon market.

    Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action would not have a significant economic impact on a substantial number of small entities.

    Executive Order 12988

    This proposed rule would allow persimmons to be imported into the United States from Japan. If this proposed rule is adopted, State and local laws and regulations regarding persimmon fruit imported under this rule would be preempted while the fruit is in foreign commerce. Fresh fruits are generally imported for immediate distribution and sale to the consuming public and would remain in foreign commerce until sold to the ultimate consumer. The question of when foreign commerce ceases in other cases must be addressed on a case-by-case basis. If this proposed rule is adopted, no retroactive effect will be given to this rule, and this rule will not require administrative proceedings before parties may file suit in court challenging this rule.

    Paperwork Reduction Act

    In accordance with section 3507(d) of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), reporting and recordkeeping requirements included in this proposed rule have been submitted for approval to the Office of Management and Budget (OMB). Please send comments on the Information Collection Request (ICR) to OMB's Office of Information and Regulatory Affairs via email to [email protected], Attention: Desk Officer for APHIS, Washington, DC 20503. Please state that your comments refer to Docket No. APHIS-2015-0098. Please send a copy of your comments to APHIS using one of the methods described under ADDRESSES at the beginning of this document.

    APHIS is proposing to amend the regulations concerning the importation of fruits and vegetables to allow the importation of fresh persimmon with calyxes from Japan into the United States. As a condition of entry, the persimmons would have to be produced in accordance with a systems approach that would include requirements for orchard certification, orchard pest control, post-harvest safeguards, fruit culling, traceback, and sampling. The persimmons would also have to be accompanied by a phytosanitary certificate with an additional declaration stating that they were produced under, and meet all the components of, the agreed upon systems approach and were inspected and found to be free of quarantine pests in accordance with the proposed requirements. Implementing this rule will require information collection activities, such as operational workplans, production site registration, box markings, inspection, remedial investigations, packinghouse registration, monitoring, and phytosanitary certificates.

    We are soliciting comments from the public (as well as affected agencies) concerning our proposed information collection and recordkeeping requirements. These comments will help us:

    (1) Evaluate whether the proposed information collection is necessary for the proper performance of our agency's functions, including whether the information will have practical utility;

    (2) Evaluate the accuracy of our estimate of the burden of the proposed information collection, 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 information collection on those who are to respond (such as 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).

    Estimate of burden: Public reporting burden for this collection of information is estimated to average 0.0035 hours per response.

    Respondents: Foreign businesses and Japan's NPPO.

    Estimated annual number of respondents: 11.

    Estimated annual number of responses per respondent: 4,553.

    Estimated annual number of responses: 50,087.

    Estimated total annual burden on respondents: 177 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.)

    A copy of the information collection may be viewed on the Regulations.gov Web site or in our reading room. (A link to Regulations.gov and information on the location and hours of the reading room are provided under the heading ADDRESSES at the beginning of this proposed rule.) Copies can also be obtained from Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at (301) 851-2727. APHIS will respond to any ICR-related comments in the final rule. All comments will also become a matter of public record.

    E-Government Act Compliance

    The Animal and Plant Health Inspection Service is committed to compliance with the E-Government Act to promote the use of the Internet and other information technologies, to provide increased opportunities for citizen access to Government information and services, and for other purposes. For information pertinent to E-Government Act compliance related to this proposed rule, please contact Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at (301) 851-2727.

    List of Subjects in 7 CFR Part 319

    Coffee, Cotton, Fruits, Imports, Logs, Nursery stock, Plant diseases and pests, Quarantine, Reporting and recordkeeping requirements, Rice, Vegetables.

    Accordingly, we propose to amend 7 CFR part 319 as follows:

    PART 319—FOREIGN QUARANTINE NOTICES 1. The authority citation for part 319 continues to read as follows: Authority:

    7 U.S.C. 450, 7701-7772, and 7781-7786; 21 U.S.C. 136 and 136a; 7 CFR 2.22, 2.80, and 371.3.

    2. Section 319.56-76 is added to subpart—Fruits and Vegetables read as follows:
    § 319.56-76 Persimmons with Calyxes from Japan.

    Fresh persimmons (Diospyros kaki Thunb.) may be imported into the United States only under the conditions described in this section. These conditions are designed to prevent the introduction of the following quarantine pests: Adisciso kaki Yamamoto, a fungus; Colletotrichum horii B. Weir & P.R. Johnst, a fungus; Conogethes puntiferalis (Guenée), a yellow peach moth; Crisicoccus matsumotoi (Siraiwa), a mealybug; Cryptosporiopsis kaki (Hara) Weinlm, a fungus; Homonopsis illotana (Kennel), a moth; Lobesia aeolopa (Meyrick), a moth; fungi Mycosphaerella nawae Hiura & Ikata, Pestalotia diospyri Syd. and P. Syd., Pestalotiopsis acacia (Thumen) Yokoyama & Kaneko, Pestalotiopsis crassiuscula Steyaert, Phoma kakivora Hara, and Phoma loti Cooke; Ponticulothrips diospyrosi (Haga & Okajima), a thrip; Pseudococcus cryptus (Hempel), a mealybug; Scirtothripsdorsalis (Hood), a thrip; Stathmopoda masinissa (Meyrick), a moth; Tenuipalpus zhizhilashviliae (Reck), a mite; and Thrips coloratus (Schmutz), a thrip.

    (a) General requirements. (1) The national plant protection organization (NPPO) of Japan must provide an operational workplan to APHIS that details the activities that the NPPO of Japan will, subject to APHIS' approval of the workplan, carry out to meet the requirements of this section. The operational workplan must include and describe the quarantine pest survey intervals and other specific requirements as set forth in this section.

    (2) Commercial consignments. Persimmons from Japan may be imported in commercial consignments only.

    (b) Places of production requirements. (1) All places of production that participate in the export program must be approved by and registered with the Japan NPPO.

    (2) The NPPO of Japan or its approved designee must visit and inspect the place of production monthly beginning at blossom drop and continuing until the end of the shipping season for quarantine pests. Appropriate pest controls must be applied in accordance with the operational workplan. If APHIS or the NPPO of Japan finds that a place of production is not complying with the requirements of this section, no fruit from the place of production will be eligible for export to the United States until APHIS and the NPPO of Japan conduct an investigation and both agree that appropriate remedial actions have been implemented.

    (3) Harvested fruit must be transported to the packinghouse in containers marked to identify the place of production from which the consignment of fruit originated.

    (c) Packinghouse requirements. (1) All packinghouses that participate in the export program must be approved by and registered with the Japanese NPPO.

    (2) During the time the packinghouse is in use for exporting persimmons to the United States, the packinghouse may only accept persimmons from registered approved production sites and the fruit must be segregated from fruit intended for other markets.

    (3) All damaged, deformed, or diseased fruit must be culled at the packinghouse.

    (4) Boxes or other containers in which the fruit is shipped must be marked to identify the place of production where the fruit originated and the packinghouse where it was packed.

    (5) The NPPO of Japan must monitor packinghouse operations to verify that the packinghouses are complying with the requirements of the regulations. If the NPPO of Japan finds that a packinghouse is not complying with the requirements of this section, no fruit from the packinghouse will be eligible for export to the United States until APHIS and the NPPO of Japan conduct an investigation and both agree that appropriate remedial actions have been implemented.

    (d) Sampling. Inspectors from the NPPO of Japan must inspect a biometric sample of the fruit, at a rate determined by APHIS, from each consignment. The inspectors must visually inspect the biometric sample for quarantine pests listed in the operational workplan required by paragraph (a) of this section and must cut fruit, at a rate determined by APHIS, to inspect for quarantine pests that are internal feeders. If quarantine pests are detected in this inspection, the consignment will be prohibited from export to the United States.

    (e) Phytosanitary certificate. Each consignment of persimmons must be accompanied by a phytosanitary certificate of inspection issued by the Japan NPPO with an additional declaration stating that the fruit in the consignment were grown, packed, and inspected and found to be free of pests in accordance with the requirements of 7 CFR 319.56-76.

    Done in Washington, DC, this 24th day of August 2016. Kevin Shea, Administrator, Animal and Plant Health Inspection Service.
    [FR Doc. 2016-20724 Filed 8-29-16; 8:45 am] BILLING CODE 3410-34-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2015-7095; Directorate Identifier 2015-SW-085-AD] RIN 2120-AA64 Airworthiness Directives; Sikorsky Aircraft Corporation Helicopters AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for Sikorsky Aircraft Corporation (Sikorsky) Model S-92A helicopters. This proposed AD would require removing from service the tail gearbox center housing (housing) when it has 12,200 or more hours time-in-service (TIS). This proposed AD is prompted by fatigue analysis conducted by Sikorsky that determined the housing required a retirement life. The proposed actions are intended to prevent a crack in the housing, which could lead to loss of tail rotor drive and loss of helicopter control.

    DATES:

    We must receive comments on this proposed AD by October 31, 2016.

    ADDRESSES:

    You may send comments by any of the following methods:

    Federal eRulemaking Docket: Go to http://www.regulations.gov. Follow the online instructions for sending your comments electronically.

    Fax: 202-493-2251.

    Mail: Send comments to the U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590-0001.

    Hand Delivery: Deliver to the “Mail” address between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    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-2015-7095; or in person at the Docket Operations Office between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the economic 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 service information identified in this proposed rule, contact Sikorsky Aircraft Corporation, Customer Service Engineering, 124 Quarry Road, Trumbull, CT 06611; telephone 1-800-Winged-S or 203-416-4299; email [email protected]

    You may review the referenced service information at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy, Room 6N-321, Fort Worth, TX 76177.

    FOR FURTHER INFORMATION CONTACT:

    Kristopher Greer, Aerospace Engineer, Boston Aircraft Certification Office, Engine & Propeller Directorate, FAA, 1200 District Avenue, Burlington, Massachusetts 01803; telephone 781-238-7799; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to participate in this rulemaking by submitting written comments, data, or views. We also invite comments relating to the economic, environmental, energy, or federalism impacts that might result from adopting the proposals in this document. The most helpful comments reference a specific portion of the proposal, explain the reason for any recommended change, and include supporting data. To ensure the docket does not contain duplicate comments, commenters should send only one copy of written comments, or if comments are filed electronically, commenters should submit only one time.

    We will file in the docket all comments that we receive, as well as a report summarizing each substantive public contact with FAA personnel concerning this proposed rulemaking. Before acting on this proposal, we will consider all comments we receive on or before the closing date for comments. We will consider comments filed after the comment period has closed if it is possible to do so without incurring expense or delay. We may change this proposal in light of the comments we receive.

    Discussion

    We propose to adopt a new AD for Sikorsky Model S-92A helicopters with a housing, part number (P/N) 92358-06107-043, installed. This proposed AD would establish a life limit of 12,200 hours TIS for the housing by requiring that the housing be removed from service when it reaches 12,200 hours TIS. This proposed AD is prompted by an analysis conducted by Sikorsky on the Model S-92A helicopter for a gross weight increase that revealed higher than expected loads. The housing currently has no life limit. Sikorsky's analysis, which used updated load conditions and updated fatigue analysis software, determined housings that remain in service beyond 12,200 hours TIS present an unacceptable risk of cracking. This condition could result in loss of tail rotor drive and loss of helicopter control.

    FAA's Determination

    We are proposing this AD because we evaluated all known relevant information and determined that an unsafe condition exists and is likely to exist or develop on other products of these same type designs.

    Related Service Information

    We reviewed Sikorsky S-92 Maintenance Manual 4-00-00, Temporary Revision No. 4-49, dated April 10, 2015, which establishes a replacement interval of 12,200 hours for housing, P/N 92358-06107-043.

    Proposed AD Requirements

    This proposed AD would require, before further flight, removing from service any tail gearbox housing, P/N 92358-06107-043, that has 12,200 or more hours TIS.

    Costs of Compliance

    We estimate that this proposed AD would affect 80 helicopters of U.S. Registry and that labor costs average $85 per work hour. Based on these estimates, we expect the following costs. Replacing the housing would require 24 work-hours, and parts would cost $58,000 for a total cost of $60,040 per helicopter.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction; and

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

    We prepared an economic evaluation of the estimated costs to comply with this proposed AD and placed it in the AD docket.

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Sikorsky Aircraft Corporation: Docket No. FAA-2015-7095; Directorate Identifier 2015-SW-085-AD. (a) Applicability

    This AD applies to Sikorsky Aircraft Corporation (Sikorsky) Model S-92A helicopters, certificated in any category, with a tail gearbox center housing, part number(P/N) 92358-06107-043, installed.

    (b) Unsafe Condition

    This AD defines the unsafe condition as a crack in a tail gearbox center housing. This condition could result in failure of the tail rotor drive and consequently loss of helicopter control.

    (c) Comments Due Date

    We must receive comments by October 31, 2016.

    (d) Compliance

    You are responsible for performing each action required by this AD within the specified compliance time unless it has already been accomplished prior to that time.

    (e) Required Actions

    Before further flight, remove from service any tail gearbox housing, P/N 92358-06107-043, that has 12,200 or more hours time-in-service.

    (f) Alternative Methods of Compliance (AMOC)

    (1) The Manager, Boston Aircraft Certification Office, FAA, may approve AMOCs for this AD. Send your proposal to: Kristopher Greer, aerospace engineer, Boston Aircraft Certification Office, Engine & Propeller Directorate, FAA, 1200 District Avenue, Burlington, Massachusetts 01803; telephone 781-238-7799; email [email protected]

    (2) For operations conducted under a 14 CFR part 119 operating certificate or under 14 CFR part 91, subpart K, we suggest that you notify your principal inspector, or lacking a principal inspector, the manager of the local flight standards district office or certificate holding district office before operating any aircraft complying with this AD through an AMOC.

    (g) Additional Information

    For service information identified in this AD, contact Sikorsky Aircraft Corporation, Customer Service Engineering, 124 Quarry Road, Trumbull, CT 06611; telephone 1-800-Winged-S or 203-416-4299; email [email protected] You may review a copy of the information at the FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy, Room 6N-321, Fort Worth, TX 76177.

    (h) Subject

    Joint Aircraft Service Component (JASC) Code: 6520, Tail Rotor Gearbox.

    Issued in Fort Worth, Texas, on August 19, 2016. Scott A. Horn, Acting Manager, Rotorcraft Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20672 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-9049; Directorate Identifier 2016-NM-039-AD] RIN 2120-AA64 Airworthiness Directives; Empresa Brasileira de Aeronautica S.A. (Embraer) Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain Empresa Brasileira de Aeronautica S.A. (Embraer) Empresa Brasileira de Aeronautica S.A. (Embraer) Model EMB-135BJ, -135ER, -135KE, -135KL, and -135LR airplanes; and Model EMB-145, -145ER, -145MR, -145LR, -145XR, -145MP, and -145EP airplanes. This proposed AD was prompted by reports of main airspeed indication discrepancies during flight; these discrepancies resulted from ice blockages in certain pitot total pressure lines. This proposed AD would require an inspection for tube misalignment of the pitot number 1 and pitot number 2 tube assembly lines, and corrective actions if necessary; installation or replacement (as applicable) of a tube ribbon heater on the pitot number 1 and pitot number 2 tube assembly lines; and revision of the airplane flight manual (AFM) to provide certain procedures and airspeed tables for the flightcrew. We are proposing this AD to detect and correct water accumulating and freezing in the pitot number 1 and pitot number 2 total pressure lines, which could result in erroneous main airspeed indications and consequent reduced ability of the flightcrew to maintain safe flight and landing of the airplane.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Empresa Brasileira de Aeronautica S.A. (Embraer), Technical Publications Section (PC 060), Av. Brigadeiro Faria Lima, 2170—Putim—12227-901 São Jose dos Campos—SP—Brasil; telephone +55 12 3927-5852 or +55 12 3309-0732; fax +55 12 3927-7546; email [email protected]; Internet http://www.flyembraer.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.

    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-2016-9049; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket 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:

    Todd Thompson, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone 425-227-1175; fax 425-227-1149.

    SUPPLEMENTARY INFORMATION: Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-9049; Directorate Identifier 2016-NM-039-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

    Discussion

    Agência Nacional de Aviação Civil (ANAC), which is the aviation authority for Brazil, has issued Brazilian Airworthiness Directive 2016-03-01, effective March 11, 2016 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Empresa Brasileira de Aeronautica S.A. (Embraer) Model EMB-135 airplanes, and Model EMB-145, -145ER, -145MR, -145LR, -145XR, -145MP, and -145EP airplanes. The MCAI states:

    This [Brazilian] AD results from reports of main airspeed indication discrepancies during flight. The investigation has revealed that Pitot #1 and #2 total pressure line blockage may occur due to water accumulation and freezing during heavy rain conditions. We are issuing this [Brazilian] AD to prevent water accumulation and freezing in the Pitot #1 and Pitot #2 total pressure lines, which could result in erroneous main airspeed indications and reduce the ability of the flight crew to maintain the safe flight and landing of the airplane.

    Since this condition may occur in other airplanes of the same type and affects flight safety, a corrective action is required. Thus, sufficient reason exists to request compliance with this [Brazilian] AD . . . .

    The required actions include a general visual inspection for tube misalignment of pitot number 1 and pitot number 2 tube assembly lines. Corrective actions include replacement of affected pitot tubes with new pitot tubes. The required actions also include installation, or, for certain airplanes, replacement, of a tube ribbon heater on the pitot number 1 and pitot number 2 tube assembly lines, and revision of the AFM to provide certain procedures and airspeed tables for the flightcrew. You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9049.

    Related Service Information Under 1 CFR Part 51

    Embraer has issued the following service information.

    • Embraer Service Bulletin 145-30-0056, Revision 01, dated March 31, 2014; and Embraer Service Bulletin 145LEG-30-0021, dated March 31, 2014. This service information describes procedures to inspect the pitot pressure tubes for misalignment, install new heaters, and perform repairs.

    • Embraer Temporary Revision (TR) 19.1, dated April 22, 2014, to Volume 1 of the Embraer EMB-145 Aircraft Operations Manual (AOM) AOM-2014135/1542. This service information contains, among other things, the “Unreliable Airspeed Procedure” in the Emergency/Abnormal Procedures section and the “Unreliable Airspeed Tables” (corresponding to the airplane configuration) in the Performance section.

    • Embraer TR 40.2, dated April 4, 2014, to Volume 1, of the Embraer EMB-145 AOM AOM-145/1114. This service information contains, among other things, the “Unreliable Airspeed Procedure” in the Emergency/Abnormal Procedures section and the “Unreliable Airspeed Tables” (corresponding to the airplane configuration) in the Performance section.

    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 Proposed 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 proposing this AD because we evaluated all pertinent information and determined an unsafe condition exists and is likely to exist or develop on other products of these same type designs.

    Costs of Compliance

    We estimate that this proposed AD affects 668 airplanes of U.S. registry.

    We also estimate that it would take up to 5 work-hours per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour. Required parts would cost about $3,254 per product. Based on these figures, we estimate the cost of this proposed AD on U.S. operators to be up to $2,457,572, or up to $3,679 per product.

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

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

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska; and

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Empresa Brasileira de Aeronautica S.A. (Embraer): Docket No. FAA-2016-9049; Directorate Identifier 2016-NM-039-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to the Empresa Brasileira de Aeronautica S.A. (Embraer) airplanes, certificated in any category, identified in paragraphs (c)(1) through (c)(4) of this AD.

    (1) Model EMB-135ER, EMB-135KE, EMB-135KL, EMB-135LR, EMB-145, EMB-145EP, EMB-145ER, EMB-145LR, EMB-145MP, EMB-145MR, and EMB-145XR airplanes, as identified in Embraer Service Bulletin 145-30-0056, Revision 01, dated March 31, 2014.

    (2) Model EMB-135BJ airplanes, as identified in Embraer Service Bulletin 145LEG-30-0021, dated March 31, 2014.

    (3) Model EMB-135ER, EMB-135KE, EMB-135KL, EMB-135LR, EMB-145, EMB-145EP, EMB-145ER, EMB-145LR, EMB-145MR, EMB-145MP, and EMB-145XR airplanes, manufacturer serial numbers (MSNs) 14501153 and subsequent.

    (4) Model EMB-135BJ airplanes, MSNs 14501190 through 14501197 inclusive, 14501199 through 14501210 inclusive, 14501212 through 14501227 inclusive, and 14501229 through 14501249 inclusive and subsequent.

    (d) Subject

    Air Transport Association (ATA) of America Code 30, Ice and rain protection.

    (e) Reason

    This AD was prompted by reports of main airspeed indication discrepancies during flight; these discrepancies resulted from ice blockages in certain pitot total pressure lines. We are issuing this AD to detect and correct water accumulating and freezing in the pitot number 1 and pitot number 2 total pressure lines, which could result in erroneous main airspeed indications and consequent reduced ability of the flightcrew to maintain safe flight and landing of the airplane.

    (f) Compliance

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

    (g) Inspection, Corrective Action, and Installation

    (1) For airplanes identified as Group 1 in Embraer Service Bulletin 145-30-0056, Revision 01, dated March 31, 2014: Within 6,600 flight hours after the effective date of this AD, do a general visual inspection for tube misalignment on the pitot number 1 and pitot number 2 tube assemblies; do all applicable corrective actions; and install a new tube ribbon heater on the pitot number 1 and pitot number 2 tube assemblies; in accordance with the Accomplishment Instructions of Embraer Service Bulletin 145-30-0056, Revision 01, dated March 31, 2014. Do all applicable corrective actions before further flight.

    (2) For airplanes identified as Group 1 in Embraer Service Bulletin 145LEG-30-0021, dated March 31, 2014: Within 5,000 flight hours or 48 months after the effective date of this AD, whichever occurs first, do a general visual inspection for tube misalignment on the pitot number 1 and pitot number 2 tube assemblies; do all applicable corrective actions; and install a new tube ribbon heater on the pitot number 1 and pitot number 2 tube assemblies; in accordance with the Accomplishment Instructions of Embraer Service Bulletin 145LEG-30-0021, dated March 31, 2014. Do all applicable corrective actions before further flight.

    (h) Inspection, Corrective Action, and Replacement

    (1) For airplanes identified as Group 2 in Embraer Service Bulletin 145-30-0056, Revision 01, dated March 31, 2014: Within 6,600 flight hours after the effective date of this AD, do a general visual inspection for tube misalignment on the pitot number 1 and pitot number 2 tube assemblies; do all applicable corrective actions; and replace the tube ribbon heater with a new tube ribbon heater on the pitot number 1 and pitot number 2 tube assemblies; in accordance with the Accomplishment Instructions of Embraer Service Bulletin 145-30-0056, Revision 01, dated March 31, 2014. Do all applicable corrective actions before further flight.

    (2) For airplanes identified as Group 2 in Embraer Service Bulletin 145LEG-30-0021, dated March 31, 2014: Within 5,000 flight hours or 48 months after the effective date of this AD, whichever occurs first, do a general visual inspection for tube misalignment on the pitot number 1 and pitot number 2 tube assemblies; do all applicable corrective actions; and replace the tube ribbon heater with a new tube ribbon heater on the pitot number 1 and pitot number 2 tube assemblies; in accordance with the Accomplishment Instructions of Embraer Service Bulletin 145LEG-30-0021, dated March 31, 2014. Do all applicable corrective actions before further flight.

    (i) Airplane Flight Manual (AFM) Revision

    (1) For airplanes identified in paragraphs (c)(1) and (c)(3) of this AD: Within 60 days after the effective date of this AD, revise the AFM to include the information in the “Unreliable Airspeed Procedure” in the Emergency/Abnormal Procedures section and the “Unreliable Airspeed Tables” (corresponding to the airplane configuration) in the Performance section, as specified in Embraer Temporary Revision (TR) 40.2, dated April 4, 2014, to Volume 1, of the Embraer EMB-145 Aircraft Operations Manual (AOM) AOM-145/1114 (“Embraer TR 40.2”).

    (2) For airplanes identified in paragraphs (c)(2) and (c)(4) of this AD: Within 60 days after the effective date of this AD, revise the AFM to include the information in the “Unreliable Airspeed Procedure” in the Emergency/Abnormal Procedures section and the “Unreliable Airspeed Tables” (corresponding to the airplane configuration) in the Performance section, as specified in Embraer TR 19.1, dated April 22, 2014, to Volume 1 of the Embraer EMB-145 AOM AOM-2014135/1542 (“Embraer TR 19.1”).

    (j) AFM Revision Method of Compliance

    The AFM revisions required by paragraphs (i)(1) and (i)(2) of this AD may be done by inserting Embraer AOM TR 40.2 or Embraer AOM TR 19.1, as applicable, into the AFM. When the applicable Embraer AOM TR has been included in general revisions of the AFM, the general revisions may be inserted in the AFM, provided the relevant information in the general revision is identical to that in Embraer AOM TR 40.2 or Embraer AOM TR 19.1, as applicable, and the applicable Embraer AOM TR may be removed from the AFM.

    (k) Credit for Previous Actions

    This paragraph provides credit for the actions required by paragraphs (g)(1) and (h)(1) of this AD, if those actions were performed before the effective date of this AD using Embraer Service Bulletin 145-30-0056, dated December 19, 2013.

    (l) 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: Todd Thompson, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone 425-227-1175; 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 Agência Nacional de Aviação Civil (ANAC); or ANAC's authorized Designee. If approved by the ANAC Designee, the approval must include the Designee's authorized signature.

    (m) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information (MCAI) Brazilian Airworthiness Directive 2016-03-01, effective March 11, 2016, 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-2016-9049.

    (2) For service information identified in this AD, contact Empresa Brasileira de Aeronautica S.A. (Embraer), Technical Publications Section (PC 060), Av. Brigadeiro Faria Lima, 2170—Putim—12227-901 São Jose dos Campos—SP—Brasil; telephone +55 12 3927-5852 or +55 12 3309-0732; fax +55 12 3927-7546; email [email protected]; Internet http://www.flyembraer.com. 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.

    Issued in Renton, Washington, on August 18, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20684 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-9051; Directorate Identifier 2016-NM-035-AD] RIN 2120-AA64 Airworthiness Directives; Airbus Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for all Airbus Model A300 B4-603, B4-620, and B4-622 airplanes; Model A300 B4-605R and A300 B4-622R airplanes; and Model A300 C4-605R Variant F airplanes. This proposed AD was prompted by an in-service detection of cracks in the fuselage skin lap joints. This proposed AD would require an ultrasonic inspection of certain skin lap joints, and repair if necessary. We are proposing this AD to detect and correct cracks in certain skin lap joints. Such cracking could result in reduced structural integrity of the airplane.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Airbus SAS, Airworthiness Office—EAW, 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.

    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-2016-9051; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket 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:

    Dan Rodina, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone 425-227-2125; fax 425-227-1149; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-9051; Directorate Identifier 2016-NM-035-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

    Discussion

    The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA Airworthiness Directive 2016-0557, dated March 18, 2016 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus Model A300 B4-603, B4-620, and B4-622 airplanes; Model A300 B4-605R and A300 B4-622R airplanes; and Model A300 C4-605R Variant F airplanes. The MCAI states:

    Prompted by in-service detection on Airbus A300-600 aeroplanes of cracks in certain fuselage skin lap joints, several studies were launched to understand the phenomenon and provide the corrective actions. More recently, new analyses were performed and the results identified that a new area has to be inspected at the skin lap joint below Stringer (STR) 28 at Frame (FR) 72 to FR 76.

    This condition, if not detected and corrected, could result in reduced structure integrity of the aeroplane.

    To address this unsafe condition, Airbus published Service Bulletin (SB) A300-53-6184 [dated November 12, 2015] to introduce inspections and applicable corrective actions for the affected areas.

    For the reason described above, this [EASA] AD requires repetitive Special Detail Inspections (SDI) of the affected skin lap joint and, depending on findings, accomplishment of applicable corrective action(s) [repairs].

    You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9051.

    Related Service Information Under 1 CFR Part 51

    We reviewed Airbus Service Bulletin A300-53-6184, November 12, 2015. The service information describes procedures for an ultrasonic inspection of the skin lap joint below stringer 28 at FR 72 to FR 76, and repair if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination and Requirements of This Proposed 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 proposing this AD because we evaluated all pertinent information and determined an unsafe condition exists and is likely to exist or develop on other products of these same type designs.

    Costs of Compliance

    We estimate that this proposed AD affects 29 airplanes of U.S. registry.

    We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Cost per product Cost on U.S. operators Ultrasonic inspection 6 work-hours × $85 per hour = $510 per inspection cycle $510 per inspection cycle $14,790 per inspection cycle.

    We have no way to determine the costs to do any necessary repairs that would be required based on the results of the proposed inspection. We have no way of determining the number of airplanes that might need these repairs.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska; and

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Airbus: Docket No. FAA-2016-9051; Directorate Identifier 2016-NM-035-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to all Airbus Model A300 B4-603, B4-620, and B4-622 airplanes; Model A300 B4-605R and A300 B4-622R airplanes; and Model A300 C4-605R Variant F airplanes, certificated in any category.

    (d) Subject

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

    (e) Reason

    This AD was prompted by an in-service detection of cracks in the fuselage skin lap joints. We are issuing this AD to detect and correct cracks in the skin lap joint below stringer 28 at frame (FR) 72 to FR 76. Such cracking could result in reduced structural integrity of the airplane.

    (f) Compliance

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

    (g) Repetitive Inspections

    Before 29,500 flight cycles since the first flight of the airplane or within 2,000 flight cycles after the effective date of this AD, whichever occurs later, do an ultrasonic inspection for cracks of the skin lap joint below stringer 28 at FR 72 to FR 76 and do all applicable repairs before further flight, in accordance with the Accomplishment Instruction of Airbus Service Bulletin A300-53-6184, November 12, 2015, except as required by paragraph (h) of this AD. Repeat the ultrasonic inspection thereafter at intervals not to exceed 5,400 flight cycles.

    (h) Exceptions to Service Information Specified Paragraph (g) of This AD

    Where Airbus Service Bulletin A300-53-6184, November 12, 2015, specifies to contact Airbus for repair instructions, and specifies that action as “RC” (Required for Compliance), this AD requires repair before further flight using a method approved in accordance with the procedures specified in paragraph (i) of this AD.

    (i) Other FAA AD Provisions

    The following provisions also apply to this AD:

    (1) Alternative Methods of Compliance (AMOCs): The Manager, International Brach, 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: Dan Rodina, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone 425-227-2125; fax 425-227-1149; email [email protected] 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 Design Organization Approval (DOA). If approved by the DOA, the approval must include the DOA-authorized signature.

    (3) Required for Compliance (RC): Except as required by paragraph (h) of this AD: 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.

    (j) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information (MCAI) EASA AD 2016-0557, dated March 18, 2016, 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-2016-9051.

    (2) For service information identified in this AD, contact Airbus SAS, Airworthiness Office—EAW, 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 service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on August 19, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20685 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-9050; Directorate Identifier 2016-NM-086-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain The Boeing Company Model 747-400, -400D, and -400F series airplanes. This proposed AD was prompted by widespread corrosion damage that was found on the skin inner surface along the upper bulkhead at certain stations between certain stringers. This proposed AD would require repetitive inspections of the fuselage crown skin inner surface, and related investigative and corrective actions if necessary. This AD would also allow for terminating actions for some of the repetitive inspections. We are proposing this AD to detect and correct cracks and corrosion on the crown skin inner surface. If the cracks or corrosion are not repaired, the cracks can rapidly join together and can cause a sudden decompression and loss of structural integrity of the airplane.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9050.

    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-2016-9050; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Nathan Weigand, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6428; fax: 425-917-6590; email: [email protected]

    SUPPLEMENTARY INFORMATION: Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-9050; Directorate Identifier 2016-NM-086-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

    Discussion

    We received a report indicating that operators have experienced widespread corrosion damage that was found on the skin inner surface along the upper bulkhead at station (STA) 1480 between stringers S-15L and S-16R, on the fuselage skin inner surface aft of the STA 1350 frame between stringers S-15 and S-16R and between stringers S-17 and S-18R, and on the skin inner surface aft of the STA 1283 frame between stringers S-5L and S-8L. This condition, if not corrected, could result in cracks that could rapidly join together and can cause a sudden decompression and loss of structural integrity of the airplane.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016. The service information describes procedures for inspecting the fuselage crown skin inner surface body at affected stations, and related investigative and corrective actions if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

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

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously, except as discussed under “Differences Between the Proposed AD and the Service Information.” For information on the procedures and compliance times, see this service information at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9050.

    The phrase “related investigative actions” is used in this proposed AD. Related investigative actions are follow-on actions that (1) are related to the primary action, and (2) further investigate the nature of any condition found. Related investigative actions in an AD could include, for example, inspections.

    The phrase “corrective actions” is used in this proposed AD. Corrective actions correct or address any condition found. Corrective actions in an AD could include, for example, repairs.

    Differences Between the Proposed AD and the Service Information

    Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016, specifies to contact the manufacturer for certain instructions, but this proposed AD would require accomplishment of repair methods, modification deviations, and alteration deviations in one of the following ways:

    • In accordance with a method that we approve; or

    • Using data that meet the certification basis of the airplane, and that have been approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) whom we have authorized to make those findings.

    Costs of Compliance

    We estimate that this proposed AD affects 53 airplanes of U.S. registry.

    We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Cost per product Cost on U.S. operators Inspections and access Up to 815 work-hours × $85 per hour = $69,275 Up to $69,275 Up to $3,671,575.

    We estimate the following costs to do any necessary repairs that would be required based on the results of the proposed inspection. We have no way of determining the number of aircraft that might need these repairs and on-condition inspections:

    On-Condition Costs Action Labor cost Parts cost Cost per product Repairs and on-condition inspections Up to 1,820 work-hours × $85 per hour = $154,700 N/A Up to $154,700.

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

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): The Boeing Company: Docket No. FAA-2016-9050; Directorate Identifier 2016-NM-086-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to The Boeing Company Model 747-400, -400D, and -400F series airplanes, certificated in any category, as identified in Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016.

    (d) Subject

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

    (e) Unsafe Condition

    This AD was prompted by widespread corrosion damage that was found on the skin inner surface along the upper bulkhead at certain stations between certain stringers. We are issuing this AD to detect and correct cracks and corrosion on the crown skin inner surface. If the cracks or corrosion are not repaired, the cracks can rapidly join together and can cause a sudden decompression and loss of structural integrity of the airplane.

    (f) Compliance

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

    (g) Inspection of the Skin Inner Surface

    At the applicable time specified in paragraph 1.E., “Compliance,” of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016, except as required by paragraph (k)(1) of this AD: Do a detailed inspection of the skin inner surface for any missing or degraded finish, sign of corrosion, or crack, in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016. Repeat the inspection thereafter at intervals not to exceed the applicable time specified in paragraph 1.E., “Compliance,” of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016, until the actions specified in paragraph (i) of this AD have been done.

    (h) Repair of the Skin Inner Surface

    If any damage is found during any inspection required by paragraph (g) of this AD, before further flight, do all applicable related investigative and correction actions, in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016, except as required by paragraph (k)(2) of this AD.

    (i) Terminating Action

    Modification or repair of the inner skin surfaces in accordance with Part 3 of the Accomplishment Instructions of Boeing Alert Service Bulletin 747-53A2878, May 19, 2016, terminates the repetitive inspections required by paragraph (g) of this AD.

    (j) Post Repair Inspection and Repairs

    For airplanes on which a repair or modification has been done in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016: Except as required by paragraph (k)(1) of this AD, at the applicable time specified in table 3 of paragraph 1.E., “Compliance,” of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016, do detailed inspections to detect damage of the repaired or modified areas, and do all applicable corrective actions, in accordance with Part 5 of the Accomplishment Instructions of Boeing Alert Service Bulletin 747-53A2878, May 19, 2016, except as required by paragraph (k)(2) of this AD. Do all applicable corrective actions before further flight. Repeat the inspections thereafter at intervals not to exceed the applicable time specified in paragraph 1.E., “Compliance,” of Boeing Alert Service Bulletin 747-53A2878, dated May 19, 2016.

    (k) Exceptions

    (1) Where Boeing Alert Service Bulletin 747-53A2878, May 19, 2016, specifies a compliance time “after the original issue date of this service bulletin,” this AD requires compliance within the specified compliance time after the effective date of this AD.

    (2) If any cracking or corrosion is found during any inspection required by this AD, and Boeing Alert Service Bulletin 747-53A2878, May 19, 2016, specifies to contact Boeing for appropriate action: Before further flight, repair the cracking or corrosion using a method approved in accordance with the procedures specified in paragraph (l) of this AD.

    (l) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (m)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Seattle ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (4) Except as required by paragraph (k)(1) and (k)(2) of this AD: For service information that contains steps that are labeled as Required for Compliance (RC), the provisions of paragraphs (l)(4)(i) and (l)(4)(ii) of this AD apply.

    (i) The steps labeled as RC, including substeps under an RC step and any figures identified in an RC step, must be done to comply with the AD. An AMOC is required for any deviations to RC steps, including substeps and identified figures.

    (ii) Steps not labeled 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 RC steps, including substeps and identified figures, can still be done as specified, and the airplane can be put back in an airworthy condition.

    (m) Related Information

    (1) For more information about this AD, contact Nathan Weigand, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle ACO, 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6428; fax: 425-917-6590; email: [email protected]

    (2) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on August 18, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20683 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-8849; Directorate Identifier 2015-NM-174-AD] RIN 2120-AA64 Airworthiness Directives; Airbus Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for all Airbus Model A330-223F, -223, -321, -322, and -323 airplanes. The proposed AD was prompted by fatigue load analysis that determined the need for certain reduced inspection intervals and updated torque values of the forward mount pylon bolts. This proposed AD would require repetitive torque checks to determine if there are any loose or broken forward engine mount bolts, and, if necessary, replacement of all four forward engine mount bolts and associated nuts, inspection of the forward mount assembly, and repair. We are proposing this AD to detect and correct loose or broken bolts, which could lead to engine detachment in flight, and damage to the airplane.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact 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.

    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-2016-8849; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket 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: Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-8849; Directorate Identifier 2015-NM-174-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

    Discussion

    On June 21, 2013, we issued AD 2013-14-04, Amendment 39-17509 (78 FR 68352, November 14, 2013) (“AD 2013-14-04”). AD 2013-14-04 requires actions intended to address the unsafe condition identified in this NPRM on all Airbus Model A330-223F, -223, -321, -322, and -323 airplanes.

    Since we issued AD 2013-14-04, we have determined that it is necessary to update the torque values of the forward mount pylon bolts.

    The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2015-0214, dated October 19, 2015 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus Model A330-223F, -223, -321, -322, and -323 airplanes. The MCAI states:

    The forward mount engine pylon bolts, Part Number (P/N) 51U615, fitted on Airbus A330 aeroplanes with Pratt & Whitney (PW) PW4000 engines, are made from MP159 material. Analysis made by PW identified that MP159 material pylon bolts do not meet the full life cycle torque check interval requirement, in a bolt-out condition. Consequently, PW issued Alert Service Bulletin (ASB) PW4G-100-A71-32, and the U.S. Federal Aviation Administration (FAA), as Engine Certification Authority, issued FAA AD 2006-16-05 [Amendment 39-14705 (71 FR 44185, August 4, 2006) (“AD 2006-16-05”)] to require repetitive torque checks of MP159 material forward mount pylon bolts fitted on certain PW4000 series engines.

    However, the engine mount system is considered to be part of aeroplane certification rather than the engine certification. Following further fatigue load analysis by Airbus of the A330 engine mount system, it was determined that the torque check interval for MP159 material forward mount pylon bolts, as required by FAA AD 2006-16-05 (2,700 flight cycles (FC)), provided an insufficient level of safety for Airbus A330 aeroplanes.

    This condition, if not detected and corrected, could ultimately lead to detachment of the engine from the aeroplane, possibly resulting in damage to the aeroplane and/or injury to persons on the ground.

    Consequently, EASA issued AD 2012-0094 [which corresponds to FAA AD 2013-14-04] to require accomplishment of repetitive torque checks of the forward mount pylon bolts installed on affected A330 aeroplanes and, depending on findings, replacement of all four bolts and associated nuts, in accordance with PW ASB PW4G-100-A71-32 Revision 01 and Airbus Service Bulletin (SB) A330-71-3028.

    Since that AD was issued, it has been concluded that a new torque value must be applied.

    Consequently, Airbus issued SB A330-71-3028 Revision 02 and PW issued ASB PW4G-100-A71-32 Revision 02 to update the torque value. Additional forward mount inspections are also provided in case of one or more forward engine mount bolts is found loose, broken or missing.

    For the reasons described above, this AD retains the requirements of EASA AD 2012-0094, which is superseded, introduces a new torque value, and requires additional inspections and, depending on findings, corrective action(s).

    Corrective actions include repetitive torque checks to determine if there are any loose or broken forward engine mount bolts on both engines, and, if necessary, replacement of all four forward engine mount bolts and associated nuts, inspection of the forward mount assembly, and repair. You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-8849.

    Related Service Information Under 1 CFR Part 51

    Airbus has issued Service Bulletin A330-71-3028, Revision 02, dated August 31, 2015. The service information describes procedures for repetitive torque checks to determine if there are any loose or broken forward engine mount bolts on both engines, replacement of all four forward engine mount bolts and associated nuts, and inspection of the forward mount assembly. 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 Proposed 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 proposing this AD because we evaluated all pertinent information and determined an unsafe condition exists and is likely to exist or develop on other products of the same type design.

    Costs of Compliance

    We estimate that this proposed AD affects 41 airplanes of U.S. registry.

    We also estimate that it would take about 3 work-hours per product to comply with the basic requirements of this proposed AD. The average labor rate is $85 per work-hour. Required parts would cost about $6,747 per product. Based on these figures, we estimate the cost of this proposed AD on U.S. operators to be $287,082, or $7,002 per product.

    In addition, we estimate that any necessary follow-on actions would take about 1 work-hour and require parts costing $6,747, for a cost of $6,832 per product. We have no way of determining the number of aircraft that might need these actions.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska; and

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Airbus: Docket No. FAA-2016-8849; Directorate Identifier 2015-NM-174-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    This AD affects AD 2006-16-05, Amendment 39-14705 (71 FR 44185, August 4, 2006) (“AD 2006-16-05”); and AD 2013-14-04, Amendment 39-17509 (78 FR 68352, November 14, 2013) (“AD 2013-14-04”).

    (c) Applicability

    This AD applies to Airbus Model A330-223F, -223, -321, -322, and -323 airplanes, certificated in any category, all manufacturer serial numbers.

    (d) Subject

    Air Transport Association (ATA) of America Code 71, Powerplant.

    (e) Reason

    This AD was prompted by fatigue load analysis that determined the need for certain reduced inspection intervals and updated torque values of the forward mount pylon bolts. We are issuing this AD to detect and correct loose or broken bolts, which could lead to engine detachment in flight, and damage to the airplane.

    (f) Compliance

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

    (g) Torque Check and Replacement

    (1) At the applicable compliance time specified in table 1 to paragraph (g) of this AD, do a torque check to determine if there are any loose or broken forward engine mount bolts (4 positions/engine) on both engines, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A330-71-3028, Revision 02, dated August 31, 2015. Repeat the torque check at the applicable time intervals not to exceed the values specified in table 1 to paragraph (g) of this AD. For the purposes of this AD, the average flight time (AFT) is defined as a computation of the number of flight hours divided by the number of flight cycles accumulated since the most recent torque check or since the airplane's first flight, as applicable. Accomplishment of the initial torque check required by this AD terminates the requirements of AD 2013-14-05.

    Table 1 to Paragraph (g) of This AD Airplane models Flight cycles accumulated as of December 19, 2013 (the effective date of AD 2013-14-04), either since last torque check specified in Pratt & Whitney Alert Service Bulletin PW4G-100-A71-32, or since airplane's first flight, as applicable Compliance time Torque check interval
  • (not to exceed)
  • Model A330-321, -322, and -323 airplanes with AFT more than 132 minutes; and Model A330-223 airplanes 0-1,850 Within 2,350 flight cycles since the last torque check as specified in Pratt & Whitney Alert Service Bulletin PW4G-100-A71-32, or since airplane's first flight, as applicable 2,350 flight cycles or 24,320 flight hours, whichever occurs first. Model A330-321, -322, and -323 airplanes with AFT more than 132 minutes; and Model A330-223 airplanes 1,851-2,700 Within 500 flight cycles after December 19, 2013 (the effective date of AD 2013-14-04), without exceeding 2,700 flight cycles since last torque check as specified in Pratt & Whitney Alert Service Bulletin PW4G-100-A71-32, or since airplane's first flight, as applicable; or within 3 months after December 19, 2013; whichever occurs later 2,350 flight cycles or 24,320 flight hours, whichever occurs first. Model A330-321, -322, and -323 airplanes with AFT 132 minutes or less; and Model A330-321, -322, and -323 airplanes on which the AFT is not calculated on a regular basis 0-1,450 Within 1,950 flight cycles since the last torque check performed as specified in Pratt & Whitney Alert Service Bulletin PW4G-100-A71-32, or since airplane's first flight, as applicable 1,950 flight cycles or 20,210 flight hours, whichever occurs first. Model A330-321, -322, and -323 airplanes with AFT 132 minutes or less; and Model A330-321,-322, and -323 airplanes on which the AFT is not calculated on a regular basis 1,451-2,700 Within 500 flight cycles after December 19, 2013 (the effective date of AD 2013-14-04), without exceeding 2,700 flight cycles since last torque check performed as specified in Pratt & Whitney Alert Service Bulletin PW4-100-A71-32, or since airplane's first flight, as applicable; or within 3 months after December 19, 2013; whichever occurs later 1,950 flight cycles or 20,210 flight hours, whichever occurs first. Model A330-223F airplanes Any Within 2,140 flight cycles or 6,600 flight hours, whichever occurs first since the last torque check performed as specified in Pratt & Whitney Alert Service Bulletin PW4G-100-A71-32, or since airplane's first flight, as applicable 2,140 flight cycles or 6,600 flight hours, whichever occurs first.

    (2) If any loose or broken bolt is detected during the check required by paragraph (g)(1) of this AD, before further flight, do the actions specified by paragraphs (g)(2)(i) and (g)(2)(ii) of this AD, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A330-71-3028, Revision 02, dated August 31, 2015; except, where the service information specifies to contact the manufacturer for further actions, this AD requires repair before further flight 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).

    (i) Replace all four forward engine mount bolts and associated nuts, on the engine where the loose or broken bolt was detected, with new bolts and nuts.

    (ii) Do nondestructive inspections of the forward mount assembly for damage including cracks, dents, nicks, and scratches, and do all applicable corrective actions.

    (3) Replacement of bolts and nuts as required by paragraph (g)(2)(i) of this AD is not terminating action for the repetitive torque checks required by paragraph (g)(1) of this AD.

    (h) Provisions for Compliance With AD 2006-16-05

    Accomplishment of the actions required by paragraph (g) of this AD constitutes compliance with the requirements specified in paragraph (g) of AD 2006-16-05.

    (i) Parts Installation Prohibition

    As of December 19, 2013 (the effective date of AD 2013-14-04), no person may install any INCO718 material, forward mount pylon bolt having Pratt & Whitney part number 54T670 on any airplane.

    (j) Credit for Previous Actions

    This paragraph provides credit for the actions required by paragraphs (g)(1) and (g)(2)(i) of this AD, if those actions were performed before the effective date of this AD using Airbus Service Bulletin A330-71-3028, dated December 16, 2011, or Airbus Service Bulletin A330-71-3028, Revision 01, dated February 20, 2012. This service information is not incorporated by reference in this AD.

    (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: 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: As of the effective date of this AD, 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 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): Except as required by paragraph (g)(2) of this AD: 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) 2015-0214, dated October 19, 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-2016-8849.

    (2) 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. 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.

    Issued in Renton, Washington, on August 18, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20681 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-9054; Directorate Identifier 2016-NM-081-AD] RIN 2120-AA64 Airworthiness Directives; Bombardier, Inc. Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain Bombardier, Inc. Model DHC-8-400 series airplanes. This AD was prompted by reports of interior emergency lights remaining “ON” following routine operational checks of the emergency light system. We are proposing this AD to require changing the wiring gauge for the affected emergency lights power supplies wiring to prevent overheating in the wires. Overheating can damage the wire insulation, causing a fire.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Bombardier, Inc., Q-Series Technical Help Desk, 123 Garratt Boulevard, Toronto, Ontario M3K 1Y5, Canada; telephone 416-375-4000; fax 416-375-4539; email [email protected]; Internet http://www.bombardier.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.

    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-2016-9054; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket 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:

    Assata Dessaline, Aerospace Engineer, Avionics and Services Branch, ANE-172, FAA, New York Aircraft Certification Office (ACO), 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; telephone 516-228-7301; fax 516-794-5531.

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-9054; Directorate Identifier 2016-NM-081-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

    Discussion

    Transport Canada Civil Aviation (TCCA), which is the aviation authority for Canada, has issued Canadian Airworthiness Directive CF-2016-12, dated May 11, 2016 (referred to after this as the Mandatory Continuing Airworthiness Information, or ”the MCAI”), to correct an unsafe condition for certain Bombardier, Inc. Model DHC-8-400 series airplanes. The MCAI states:

    There have been several reports of Interior Emergency Lights remaining “ON” following routine operational checks of the Emergency Light System. During these events, the system could not be deactivated and the associated circuit breaker was also found tripped. The events were caused by the overheating of the negative interlock and ground wires at the Emergency Light System Power Supplies.

    Investigation has determined that the wire gauge of the negative interlock and ground wiring is incompatible with the current load experienced during the Emergency Light System operational check and this has led to the degradation of the wiring insulation.

    This [Canadian] AD is being issued to mandate the change of the wiring gauge from 22 to 20 American wire gauge (AWG) for the affected Emergency Lights Power Supplies wiring.

    You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9054.

    Related Service Information Under 1 CFR Part 51

    We reviewed Bombardier Service Bulletin 84-33-12, Revision A, dated January 19, 2016. This service information describes procedures for changing the wiring gauge for the affected emergency lights power supplies wiring to prevent overheating in the wires. 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 Proposed 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 proposing this AD because we evaluated all pertinent information and determined an unsafe condition exists and is likely to exist or develop on other products of the same type design.

    Costs of Compliance

    We estimate that this proposed AD affects 52 airplanes of U.S. registry.

    We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S. operators
    Replacement 8 work-hours × $85 per hour = $680 Supplied from operator stock $680 $35,360
    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska; and

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Bombardier, Inc.: Docket No. FAA-2016-9054; Directorate Identifier 2016-NM-081-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to Bombardier, Inc. Model DHC-8-400, -401, and -402 airplanes, certificated in any category, serial numbers 4001, and 4003 through 4507 inclusive.

    (d) Subject

    Air Transport Association (ATA) of America Code 33, Lights.

    (e) Reason

    This AD was prompted by reports of interior emergency lights remaining “ON” following routine operational checks of the emergency light system. We are issuing this AD to prevent overheating in the wires. Overheating can damage the wire insulation, causing a fire.

    (f) Compliance

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

    (g) Replacement of Affected Wires

    Within 6,000 flight hours or 36 months, whichever occurs first, after the effective date of this AD, incorporate Bombardier Modsum 4-126620 to change the wire gauge, in accordance with Bombardier Service Bulletin 84-33-12, Revision A, dated January 19, 2016.

    (h) Credit for Previous Actions

    This paragraph provides credit for actions required by paragraph (g) of this AD, if those actions were performed before the effective date of this AD using Bombardier Service Bulletin 84-33-12, dated September 29, 2015.

    (i) Other FAA AD Provisions

    The following provisions also apply to this AD:

    (1) Alternative Methods of Compliance (AMOCs): The Manager, New York Aircraft Certification Office (ACO), ANE-170, 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 ACO send it to ATTN: Program Manager, Continuing Operational Safety, FAA, New York ACO, 1600 Stewart Avenue, Suite 410, Westbury, NY 11590; telephone 516-228-7300; fax 516-794-5531. 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.

    (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, New York ACO, ANE-170, FAA; or Transport Canada Civil Aviation (TCCA); or Bombardier, Inc.'s TCCA Design Approval Organization (DAO). If approved by the DAO, the approval must include the DAO-authorized signature.

    (j) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information (MCAI) Canadian Airworthiness Directive CF-2016-12, dated May 11, 2016, 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-2016-9054.

    (2) For service information identified in this AD, contact Bombardier, Inc., Q-Series Technical Help Desk, 123 Garratt Boulevard, Toronto, Ontario M3K 1Y5, Canada; telephone 416-375-4000; fax 416-375-4539; email [email protected]; Internet http://www.bombardier.com. 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.

    Issued in Renton, Washington, on August 19, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20691 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-8848; Directorate Identifier 2016-NM-054-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain The Boeing Company Model 737-300, -400, and -500 series airplanes. This proposed AD was prompted by an evaluation by the design approval holder (DAH) indicating that the fuselage skin is subject to widespread fatigue damage (WFD). This proposed AD would require modification of the lap joint, including related investigative actions and corrective actions if necessary. This proposed AD also would require repetitive post-modification inspections for cracking of the skin at critical fastener rows, and corrective actions if necessary. We are proposing this AD to detect and correct cracks at the lap joint skin that could link up and result in rapid decompression and loss of structural integrity of the airplane.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone: 206-544-5000, extension 1; fax: 206-766-5680; Internet: https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-8848.

    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-2016-8848; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Wade Sullivan, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6430, fax: 425-917-6590; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-8848; Directorate Identifier 2016-NM-054-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

    Discussion

    Fatigue damage can occur locally, in small areas or structural design details, or globally, in widespread areas. Multiple-site damage is widespread damage that occurs in a large structural element such as a single rivet line of a lap splice joining two large skin panels. Widespread damage can also occur in multiple elements such as adjacent frames or stringers. Multiple-site damage and multiple-element damage cracks are typically too small initially to be reliably detected with normal inspection methods. Without intervention, these cracks will grow, and eventually compromise the structural integrity of the airplane. This condition is known as widespread fatigue damage. It is associated with general degradation of large areas of structure with similar structural details and stress levels. As an airplane ages, WFD will likely occur, and will certainly occur if the airplane is operated long enough without any intervention.

    The FAA's WFD final rule (75 FR 69746, November 15, 2010) became effective on January 14, 2011. The WFD rule requires certain actions to prevent structural failure due to WFD throughout the operational life of certain existing transport category airplanes and all of these airplanes that will be certificated in the future. For existing and future airplanes subject to the WFD rule, the rule requires that DAHs establish a limit of validity (LOV) of the engineering data that support the structural maintenance program. Operators affected by the WFD rule may not fly an airplane beyond its LOV, unless an extended LOV is approved.

    The WFD rule (75 FR 69746, November 15, 2010) does not require identifying and developing maintenance actions if the DAHs can show that such actions are not necessary to prevent WFD before the airplane reaches the LOV. Many LOVs, however, do depend on accomplishment of future maintenance actions. As stated in the WFD rule, any maintenance actions necessary to reach the LOV will be mandated by airworthiness directives through separate rulemaking actions.

    In the context of WFD, this action is necessary to enable DAHs to propose LOVs that allow operators the longest operational lives for their airplanes, and still ensure that WFD will not occur. This approach allows for an implementation strategy that provides flexibility to DAHs in determining the timing of service information development (with FAA approval), while providing operators with certainty regarding the LOV applicable to their airplanes.

    We have received a report indicating that a Model 737-300 series airplane with 20-inch spaced tear strap crown skin configuration experienced a rapid decompression when the lap joint at stringer S-4L between station (STA) 664 and STA 727 cracked and opened up. Investigation shows that the cracks were caused by fatigue cracks in the lower skin at the lower row of fasteners in the S-4L lap joint. The airplane had accumulated 39,781 total flight cycles and 48,740 total flight hours. This condition, if not corrected, could result in rapid decompression and loss of structural integrity.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016. The service information describes procedures for modification of the lap joint, including related investigative actions and corrective actions if necessary. The service information also describes procedures for post-modification inspections for cracking of the skin at critical fastener rows, and corrective actions if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

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

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously, except as discussed under “Differences Between this Proposed AD and the Service Information.” For information on the procedures and compliance times, see this service information at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-8848.

    The phrase “related investigative actions” is used in this proposed AD. Related investigative actions are follow-on actions that (1) are related to the primary action, and (2) further investigate the nature of any condition found. Related investigative actions in an AD could include, for example, inspections.

    The phrase “corrective actions” is used in this proposed AD. Corrective actions correct or address any condition found. Corrective actions in an AD could include, for example, repairs.

    Differences Between This Proposed AD and the Service Information

    Boeing Alert Service Bulletin 737-53A1343, date March 25, 2016, specifies to contact the manufacturer for certain instructions, but this proposed AD would require accomplishment of repair methods, modification deviations, and alteration deviations in one of the following ways:

    • In accordance with a method that we approve; or

    • Using data that meet the certification basis of the airplane, and that have been approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) whom we have authorized to make those findings.

    Explanation of Compliance Time

    The compliance time for the modification specified in this proposed AD for addressing WFD was established to ensure that discrepant structure is modified before WFD develops in airplanes. Standard inspection techniques cannot be relied on to detect WFD before it becomes a hazard to flight. We will not grant any extensions of the compliance time to complete any AD-mandated service bulletin related to WFD without new data that would substantiate and clearly warrant such an extension.

    Costs of Compliance

    We estimate that this proposed AD affects 115 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per product Cost on U.S. operators Lap joint skin modification 2,142 work-hours × $85 per hour = $182,070 per modification $12,500 $194,570 $22,375,550. Post-Modification inspection 102 work-hours × $85 per hour = $8,670 per inspection cycle $0 $8,670 per inspection cycle $997,050 per inspection cycle.

    We have received no definitive data that would enable us to provide cost estimates for the on-condition actions specified in this proposed 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 proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the national Government and the States, or on the distribution of power and responsibilities among the various levels of government.

    For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): The Boeing Company: Docket No. FAA-2016-8848; Directorate Identifier 2016-NM-054-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    This AD affects AD 2015-16-08, Amendment 39-18233 (80 FR 51450, August 25, 2015) (“AD 2015-16-08”).

    (c) Applicability

    This AD applies to The Boeing Company Model 737-300, -400, and -500 series airplanes, certificated in any category, as identified in Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016; except for Group 5 airplanes identified in Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016.

    (d) Subject

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

    (e) Unsafe Condition

    This AD was prompted by an evaluation by the design approval holder (DAH) indicating that the fuselage skin is subject to widespread fatigue damage (WFD). We are issuing this AD to detect and correct cracks at the lap joint skin that could link up and result in rapid decompression and loss of structural integrity of the airplane.

    (f) Compliance

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

    (g) Lap Joint Skin Modification

    Before the accumulation of 50,000 total flight cycles, or within 3,000 flight cycles after the effective date of this AD, whichever occurs later: Modify the lap joint skin, including doing all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016, except as required by paragraph (i) of this AD. Do all applicable related investigative and corrective actions before further flight.

    (h) Inspection of the Critical Fastener Rows

    Within 38,000 flight cycles after modifying the lap joint skin as required by paragraph (g) of this AD: Inspect the skin at critical fastener rows by doing the actions specified in paragraph (h)(1) or (h)(2) of this AD, in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016. If any crack is found during any inspection, repair before further flight using a method approved in accordance with the procedures specified in paragraph (l) of this AD. Repeat the inspection thereafter at intervals not to exceed 2,000 flight cycles in unrepaired areas.

    (1) From the inside of the airplane: Do a low frequency eddy current (LFEC) inspection for any crack in the skin at the critical fastener row, and a medium frequency eddy current (MFEC) inspection for any crack in the skin at the critical fastener row.

    (2) From the outside of the airplane: Do a LFEC inspection for any crack in the fuselage skin.

    (i) Exception to Service Information Specifications

    Although Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016, specifies to contact Boeing for repair instructions, and specifies that action as “RC” (Required for Compliance), this AD requires repair before further flight using a method approved in accordance with the procedures specified in paragraph (l) of this AD.

    (j) AD Provisions for Part 26 Supplemental Inspections

    Table 5 of paragraph 1.E., “Compliance,” of Boeing Alert Service Bulletin 737-53A1343, dated March 25, 2016, specifies post-modification airworthiness limitation inspections in compliance with 14 CFR 25.571(a)(3) at the modified locations, which support compliance with 14 CFR 121.1109(c)(2) or 129.109(b)(2). As airworthiness limitations, these inspections are required by maintenance and operational rules. It is therefore unnecessary to mandate them in this AD. Deviations from these inspections require FAA approval, but do not require an alternative method of compliance.

    (k) Terminating Action for AD 2015-16-08

    Accomplishing the modification required by paragraph (g) of this AD terminates the inspections required by paragraphs (g), (h), (i), (j), and (k) of AD 2015-16-08 for the modified area only.

    (l) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (m)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Seattle ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (4) Except as required by paragraph (i) of this AD: For service information that contains steps that are labeled as Required for Compliance (RC), the provisions of paragraphs (l)(4)(i) and (l)(4)(ii) of this AD apply.

    (i) The steps labeled as RC, including substeps under an RC step and any figures identified in an RC step, must be done to comply with the AD. An AMOC is required for any deviations to RC steps, including substeps and identified figures.

    (ii) Steps not labeled 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 RC steps, including substeps and identified figures, can still be done as specified, and the airplane can be put back in an airworthy condition.

    (m) Related Information

    (1) For more information about this AD, contact Wade Sullivan, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle ACO, 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6430, fax: 425-917-6590; email: [email protected]

    (2) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone: 206-544-5000, extension 1; fax: 206-766-5680; Internet: https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on August 16, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20673 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-9053; Directorate Identifier 2016-NM-075-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for all The Boeing Company Model 747-8 and 747-8F series airplanes. This proposed AD was prompted by reports of damaged vapor seals, block seals, and heat shield seals on the outboard pylons between the engine strut and aft fairing. This proposed AD would require repetitive inspections for heat damage of the vapor seals between the engine strut and aft fairing, and replacement of the seals with new seals if necessary. We are proposing this AD to detect and correct heat damage to the vapor seals between the engine strut and aft fairing. Such damage could allow flammable fluid leakage into the aft fairing, which could result in an uncontrolled fire in the engine strut.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9053.

    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-2016-9053; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Sue Lucier, Aerospace Engineer, Propulsion Branch, ANM-140S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6438; fax: 425-917-6590; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-9053; Directorate Identifier 2016-NM-075-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

    Discussion

    We have received reports of damaged vapor seals, block seals, and heat shield seals on the outboard pylons between the aft fairing and engine strut on the number 1 and number 4 engines. The reports indicate that vapor seal damage occurring on the outboard pylons at 1,468 flight cycles, fully compromised the vapor seals at 2,768 flight cycles and 3,626 flight cycles. It was determined that this condition affects only the outboard pylons because the vapor seal is located directly above the heat shield seal in these pylons. Heat from the exhaust nozzle to the vapor seal damages the seal and degrades the sealing quality. The vapor seal is a safety feature that is designed to isolate flammable hydraulic fluid from an ignition source. If the vapor seal has heat damage and there is a hydraulic leak that sprays onto the strut bulkhead, fluid could drain across the worn seal and contact heat shield surfaces below the seals. Flammable fluid leakage into the aft fairing could result in an uncontrolled fire in the engine strut.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Alert Service Bulletin 747-54A2246, dated February 5, 2016. The service information describes procedures for repetitive inspections for heat damage of the vapor seals between the engine strut and aft fairing, and replacement of the seals with new seals. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

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

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously, except as discussed under “Difference Between this Proposed AD and the Service Information.” For information on the procedures and compliance times, see this service information at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9053.

    Difference Between This Proposed AD and the Service Information

    Boeing Alert Service Bulletin 747-54A2246, dated February 5, 2016, recommends accomplishment of Part 4, “Structural Inspection and Repair for Heat Damage” (economic related), during accomplishment of Part 3, “Seal Replacement” (safety related), before installation of new seals. Part 4 is included as an economic consideration to prevent possible operational disruptions. However, this NPRM would not require those structural inspections.

    Interim Action

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

    Costs of Compliance

    We estimate that this proposed AD affects 10 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per product Cost on U.S.
  • operators
  • Vapor seal inspections 4 work-hours X $85 per hour = $340 per inspection cycle $0 $340 per inspection cycle $3,400 per inspection cycle

    We estimate the following costs to do any necessary seal replacement that would be required based on the results of the proposed vapor seal inspection. We have no way of determining the number of aircraft that might need these seal replacements.

    On-Condition Costs Action Labor cost Parts cost Cost per
  • product
  • Seal replacement 132 work-hours × $85 per hour = $11,220 $0 $11,220

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

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): The Boeing Company: Docket No. FAA-2016-9053; Directorate Identifier 2016-NM-075-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to all The Boeing Company Model 747-8 and 747-8F series airplanes, certificated in any category.

    (d) Subject

    Air Transport Association (ATA) of America Code 54 Nacelles/pylons.

    (e) Unsafe Condition

    This AD was prompted by reports of damaged vapor seals, block seals, and heat shield seals on the outboard pylons between the engine strut and aft fairing. We are issuing this AD to detect and correct heat damage to the vapor seals between the engine strut and aft fairing. Such damage could allow flammable fluid leakage into the aft fairing, which could result in an uncontrolled fire in the engine strut.

    (f) Compliance

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

    (g) Repetitive Inspections

    At the later of the times specified in paragraphs (g)(1) and (g)(2) of this AD: Do a detailed inspection for heat damage of the vapor seals on the outboard pylons between the strut and aft fairing of the numbers 1 and 4 engines, in accordance with Part 2 of the Accomplishment Instructions of Boeing Alert Service Bulletin 747-54A2246, dated February 5, 2016. Repeat the inspection thereafter at intervals not to exceed 1,200 flight cycles.

    (i) Before the accumulation of 1,800 total flight cycles, or within 1,800 flight cycles after the most recent vapor seal, block seal, and heat shield seal replacement, whichever is later.

    (ii) Within 6 months after the effective date of this AD.

    (h) Replacement

    If during any inspection required by paragraph (g) of this AD any heat damage of any vapor seal is found: Before further flight, replace the vapor seal, heat shield seal, and block seal with new seals, in accordance with Part 3 of the Accomplishment Instructions of Boeing Alert Service Bulletin 747-54A2246, dated February 5, 2016. Repeat the inspection required by paragraph (g) of this AD within 1,800 flight cycles after doing the replacement, and thereafter at intervals not to exceed 1,200 flight cycles.

    (i) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (j)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Seattle ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (4) For service information that contains steps that are labeled as Required for Compliance (RC), the provisions of paragraphs (i)(4)(i) and (i)(4)(ii) apply.

    (i) The steps labeled as RC, including substeps under an RC step and any figures identified in an RC step, must be done to comply with the AD. An AMOC is required for any deviations to RC steps, including substeps and identified figures.

    (ii) Steps not labeled 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 RC steps, including substeps and identified figures, can still be done as specified, and the airplane can be put back in an airworthy condition.

    (j) Related Information

    (1) For more information about this AD, contact Sue Lucier, Aerospace Engineer, Propulsion Branch, ANM-140S, FAA, Seattle ACO, 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6438; fax: 425-917-6590; email: [email protected]

    (2) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on August 19, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20667 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-9052; Directorate Identifier 2016-NM-080-AD] RIN 2120-AA64 Airworthiness Directives; Airbus Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for all Airbus Model A300 series airplanes; Model A300 B4-600, B4-600R, and F4-600R series airplanes, and Model A300 C4-605R Variant F airplanes (collectively called Model A300-600 series airplanes); and Model A310 series airplanes. This proposed AD was prompted by reports of failure of an aft hinge bolt assembly in the nose landing gear (NLG) aft doors. This proposed AD would require replacement of the aft hinge bolt assembly in the left and right NLG aft doors, with new aft hinge bolt assemblies. We are proposing this AD to prevent failure of an aft hinge bolt assembly in an NLG aft door while the airplane is in flight, which could lead to an in-flight loss of an NLG aft door, and damage to the airplane.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Airbus SAS, Airworthiness Office—EAW, 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.

    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-2016-9052; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket 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:

    Dan Rodina, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone 425-227-2125; fax 425-227-1149.

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-9052; Directorate Identifier 2016-NM-080-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

    Discussion

    The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2016-0100, dated May 24, 2016 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus Model A300 series airplanes; Model A300 B4-600, B4-600R, and F4-600R series airplanes, and Model A300 C4-605R Variant F airplanes (collectively called Model A300-600 series airplanes); and Model A310 series airplanes. The MCAI states:

    An occurrence has been reported of failure of a nose landing gear (NLG) door aft hinge bolt assembly, Part Number (P/N) A53612600000. The result of laboratory investigations revealed that the aft hinge bolt rupture was initiated by fatigue crack development in the under head radius of the bolt, due to the lack of radius roll over and in combination with a non-optimised design.

    This condition, if not detected and corrected, could lead to in-flight loss of an aft NLG door, possibly resulting in damage to the aeroplane and injury to persons on the ground.

    Prompted by these findings, Airbus developed a new design aft hinge bolt assembly P/N A53612713000, introduced as Airbus modification (mod) 13741, to replace the existing bolt P/N A53612600000. Since the introduction of that mod, additional stress calculations demonstrated that the new bolt assembly, P/N A53612713000, cannot sustain fatigue loads up to the design Limit of Validity (LOV) of the affected aeroplanes.

    To address this potential unsafe condition, Airbus issued Service Bulletin (SB) A300-53-0397, SB A310-53-2144 and SB A300-53-6186, to provide instructions for the repetitive replacement of the affected post-mod 13741 P/N A53612713000 aft hinge bolts.

    For the reasons described above, this [EASA] AD requires the replacement of all P/N A53612600000 aft hinge bolt assemblies, installed on the left hand (LH) and right hand (RH) NLG aft doors, with post-mod 13741 P/N A53612713000 aft hinge bolt assemblies, and, subsequently, the implementation of a life limit for those new bolt assemblies.

    You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-9052.

    Related Service Information Under 1 CFR Part 51

    Airbus has issued the following service information.

    • Airbus Service Bulletin A300-53-0396, dated November 25, 2015.

    • Airbus Service Bulletin A300-53-0397, dated January 18, 2016.

    • Airbus Service Bulletin A300-53-6182, dated November 17, 2015.

    • Airbus Service Bulletin A300-53-6186, dated January 18, 2016.

    • Airbus Service Bulletin A310-53-2142, dated November 17, 2015.

    • Airbus Service Bulletin A310-53-2144, dated January 18, 2016.

    The service information describes procedures for replacement of the aft hinge bolt assembly in the left and right NLG aft doors, with new aft hinge bolt assemblies.

    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 Proposed 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 proposing this AD because we evaluated all pertinent information and determined an unsafe condition exists and is likely to exist or develop on other products of these same type designs.

    Costs of Compliance

    We estimate that this proposed AD affects 157 airplanes of U.S. registry.

    We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on
  • U.S. operators
  • Replacement 9 work-hours × $85 per hour = $765 $2,000 $2,765 $434,105
    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska; and

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Airbus: Docket No. FAA-2016-9052; Directorate Identifier 2016-NM-080-AD. (a) Comments Due Date

    We must receive comments by October 14, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to Airbus airplanes identified in paragraphs (c)(1) through (c)(6) of this AD, certificated in any category, all manufacturer serial numbers.

    (1) Model A300 B2-1A, B2-1C, B2K-3C, B2-203, B4-2C, B4-103, and B4-203 airplanes.

    (2) Model A300 B4-601, B4-603, B4-620, and B4-622 airplanes.

    (3) Model A300 B4-605R and B4-622R airplanes.

    (4) Model A300 F4-605R and F4-622R airplanes.

    (5) Model A300 C4-605R Variant F airplanes.

    (6) Model A310-203, -204, -221, -222, -304, -322, -324, and -325 airplanes.

    (d) Subject

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

    (e) Reason

    This AD was prompted by reports of failure of an aft hinge bolt assembly in the nose landing gear (NLG) aft doors. We are issuing this AD to prevent failure of an aft hinge bolt assembly in an NLG aft door while the airplane is in flight, which could lead to an in-flight loss of an NLG aft door, and damage to the airplane.

    (f) Compliance

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

    (g) Replace the Aft Hinge Bolt Assemblies Having Part Number (P/N) A53612600000

    Before the accumulation of 10,000 total flight cycles since first flight of the airplane, or within 2,000 flight cycles after the effective date of this AD, whichever occurs later, replace each aft hinge bolt assembly having P/N A53612600000 on the left and right NLG aft doors, with a new hinge bolt assembly having P/N A53612713000, in accordance with the Accomplishment Instructions of the applicable service information identified in paragraph (g)(1), (g)(2), or (g)(3) of this AD.

    (1) Airbus Service Bulletin A300-53-0396, dated November 25, 2015.

    (2) Airbus Service Bulletin A310-53-2142, dated November 17, 2015.

    (3) Airbus Service Bulletin A300-53-6182, dated November 17, 2015.

    (h) Replace the Aft Hinge Bolt Assemblies Having P/N A53612713000

    Within 10,000 flight cycles after modification of an airplane as required by paragraph (g) of this AD, replace each aft hinge bolt assembly having P/N A53612713000 on the left and right aft NLG doors, with a new aft hinge bolt assembly having P/N A53612713000 on the left and right NLG aft doors, in accordance with the Accomplishment Instructions of the applicable service information specified in paragraph (h)(1), (h)(2), or (h)(3) of this AD. Repeat the replacement thereafter at intervals not to exceed 10,000 flight cycles.

    (1) Airbus Service Bulletin A300-53-0397, dated January 18, 2016.

    (2) Airbus Service Bulletin A310-53-2144, dated January 18, 2016.

    (3) Airbus Service Bulletin A300-53-6186, dated January 18, 2016.

    (i) Parts Installation Prohibition (P/N A53612600000)

    After modification of an airplane NLG aft door as required by paragraph (g) of this AD, do not install an aft hinge bolt assembly having P/N A53612600000 on any NLG aft door of that airplane.

    (j) Parts Installation Limitation (P/N A53612713000)

    After removal of an aft hinge bolt assembly having P/N A53612713000 from an airplane aft NLG door, as required by paragraph (h) of this AD, do not install an aft hinge bolt assembly having that part number on any airplane unless it is a new aft hinge bolt assembly.

    (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: Dan Rodina, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone 425-227-2125; 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.

    (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 2016-0100 dated May 24, 2016, 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-2016-9052.

    (2) For service information identified in this AD, contact Airbus SAS, Airworthiness Office—EAW, 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 service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on August 19, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20699 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2014-0923; Directorate Identifier 2014-NM-176-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

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

    ACTION:

    Proposed rule; withdrawal.

    SUMMARY:

    The FAA withdraws a notice of proposed rulemaking (NPRM) that proposed a new airworthiness directive (AD), which would have applied to certain The Boeing Company Model 737-700, -800, and -900ER series airplanes. The NPRM would have required repetitive inspections to detect cracking in the crown skin panel assembly. The NPRM would also have provided optional terminating action for the repetitive inspections. Since the NPRM was issued, all affected airplanes worldwide have had applicable terminating actions accomplished, and one airplane was mistakenly included in the applicability. Accordingly, the NPRM is withdrawn.

    DATES:

    As of August 30, 2016, the proposed rule, which was published in the Federal Register on December 15, 2014 (79 FR 74032), is withdrawn.

    ADDRESSES:

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2014-0923; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD action, the NPRM (79 FR 74032, December 15, 2014), the regulatory evaluation, any comments received, and other information. The address for the Docket Office (telephone: 800-647-5527) is the Docket Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    FOR FURTHER INFORMATION CONTACT:

    Gaetano Settineri, Aerospace Engineer, Airframe Branch, ANM-120S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6577; fax: 425-917-6590; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Discussion

    We proposed to amend part 39 of the Federal Aviation Regulations (14 CFR part 39) with a NPRM for a new AD for certain The Boeing Company Model 737-700, -800, and -900ER series airplanes. The NPRM published in the Federal Register on December 15, 2014 (79 FR 74032) (“the NPRM”). The NPRM would have required repetitive inspections to detect cracking in the crown skin panel assembly. The NPRM would also have provided optional terminating action for the repetitive inspections. The NPRM was prompted by reports of troughs in the skin along the chem-mill pocket edges of certain fuselage crown skin panel assemblies. The proposed actions were intended to detect and correct cracking from troughs in the chem-mill pocket edges, which could lead to rapid decompression of the airplane.

    Actions Since NPRM Was Issued

    Since we issued the NPRM, we have determined that all affected airplanes worldwide have had applicable terminating actions accomplished, and one airplane had been included mistakenly in the applicability. The unsafe condition identified in the NPRM was created due to a production escapement and was limited to 11 airplanes. However, the affected airplanes have all been inspected for the unsafe condition and in instances where the unsafe condition was present, the discrepant parts were replaced with conforming parts. With the discrepant parts replaced, the unsafe condition no longer exists.

    Comments

    We gave the public the opportunity to participate in considering the NPRM. Two commenters, Boeing and Aviation Partners Boeing, requested certain changes to the NPRM that are considered moot by this withdrawal.

    FAA's Conclusions

    Upon further consideration, we have determined that the unsafe condition described in the NPRM no longer exists. Accordingly, the NPRM is withdrawn.

    Withdrawal of the NPRM does not preclude the FAA from issuing another related action or commit the FAA to any course of action in the future.

    Regulatory Impact

    Since this action only withdraws an NPRM, it is neither a proposed nor a final rule and therefore is not covered under Executive Order 12866, the Regulatory Flexibility Act, or DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979).

    List of Subjects in 14 CFR Part 39

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

    The Withdrawal

    Accordingly, we withdraw the NPRM, Docket No. FAA-2014-0923, Directorate Identifier 2014-NM-176-AD, which was published in the Federal Register on December 15, 2014 (79 FR 74032).

    Issued in Renton, Washington, on August 18, 2016. Dorr M. Anderson, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-20704 Filed 8-29-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-8850; Directorate Identifier 2016-NM-031-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain The Boeing Company Model 767-200 and -300 series airplanes. This proposed AD was prompted by a report of a fire in the bilge area of the cargo compartment that burned through the insulation blankets that were intended to prevent smoke from migrating behind the cargo compartment sidewall liners and upward into the main cabin. This proposed AD would require replacing the cargo compartment insulation blankets on the left and right sides with new insulation blankets that incorporate fire stops. We are proposing this AD to prevent a fire in the bilge area of the cargo compartment burning through the insulation blankets and consequently allowing smoke to migrate behind the cargo compartment sidewall liners and upward into the main cabin.

    DATES:

    We must receive comments on this proposed AD by October 14, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-8850.

    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-2016-8850; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Francis Smith, Aerospace Engineer, Cabin Safety & Environmental Control Systems, ANM-150S, FAA, Seattle Aircraft Certification Office, 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6596; fax: 425-917-6590; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-8850; Directorate Identifier 2016-NM-031-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

    Discussion

    We have received a report of a fire in the bilge area of the cargo compartment that burned through the insulation blankets that were intended to prevent smoke from migrating behind the cargo compartment sidewall liners and upward into the main cabin. The airplane was delivered with a partial floor configuration in the cargo compartment, and later modified into a full floor configuration. This event showed that the insulation blankets installed are not adequate to prevent fire in the bilge area from migrating past the cargo compartment sidewall liners and allowing smoke into the main cabin. We have determined that some airplanes with the full floor configuration in the cargo compartment did not receive the insulation blankets with fire stops. This condition, if not corrected, could result in a fire in the bilge area of the cargo compartment burning through the insulation blankets, which could result in smoke migrating behind the cargo compartment sidewall liners and upward into the main cabin.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Special Attention Service Bulletin 767-25-0550, dated January 30, 2015. The service information describes procedures for replacing the cargo compartment insulation blankets on the left and right sides between stringers 29 and 33 with new insulation blankets that incorporate fire stops. Th