Federal Register Vol. 81, No.250,

The Director of OGE (Director) is authorized by 18 U.S.C. 207(h) to designate distinct and separate departmental or agency components in the executive branch for purposes of 18 U.S.C. 207(c), the one-year post-employment conflict of interest restriction for senior employees. The representational bar of 18 U.S.C. 207(c) usually extends to the whole of any department or agency in which a former senior employee served in any capacity during the year prior to termination from a senior employee position. However, 18 U.S.C. 207(h) provides that whenever the Director determines that an agency or bureau within a department or agency in the executive branch exercises functions which are distinct and separate from the remaining functions of the department or agency and there exists no potential for use of undue influence or unfair advantage based on past Government service, the Director shall by rule designate such agency or bureau as a separate component of that department or agency. Under 18 U.S.C. 207(h)(2), component designations do not apply to persons employed at a rate of pay specified in or fixed according to subchapter II of 5 U.S.C. chapter 53 (the Executive Schedule). Component designations are listed in appendix B to 5 CFR part 2641.

Pursuant to the procedures prescribed in 5 CFR 2641.302(e), two agencies forwarded written requests to OGE to amend their listings in appendix B to part 2641, and on October 18, 2016, OGE published a proposed rule in the Federal Register, 81 FR 71644, Oct. 18, 2016, that proposed to revise the component designations of those two agencies. The proposed rule provided a 30-day comment period, which ended on November 17, 2016. OGE did not receive any comments. The rationale for the proposed rule, which OGE is now adopting as final, is explained in the preamble at: https://www.thefederalregister.org/fdsys/pkg/FR-2016-10-18/pdf/2016-25054.pdf.

For the reasons stated in the preamble to the proposed rule, OGE is granting the request of the Department of Labor and is amending the agency's listing in appendix B to part 2641 to remove the designation of the Employment Standards Administration (ESA), and in the place of ESA, designate the Office of Federal Contract Compliance Programs, Office of Labor Management Standards, Office of Workers' Compensation Programs, and the Wage and Hour Division as distinct and separate components of the Department of Labor for purposes of 18 U.S.C. 207(c). OGE also is granting the request of the Department of Transportation and amending the agency's listing in appendix B to part 2641 to remove the designation of the Surface Transportation Board and designate the Pipeline and Hazardous Materials Safety Administration as a distinct and separate component of the Department of Transportation for purposes of 18 U.S.C. 207(c).

As indicated in 5 CFR 2641.302(f), a designation “shall be effective on the date the rule creating the designation is published in the Federal Register and shall be effective as to individuals who terminated senior service either before, on or after that date.” Initial designations in appendix B to part 2641 were effective as of January 1, 1991. The effective date of subsequent designations is indicated by means of parenthetical entries in appendix B. The new component designations made in this rule are effective December 29, 2016.

As also indicated in 5 CFR 2641.302(f), revocation of a component designation is effective 90 days after the publication in the Federal Register of the rule that revokes the designation. Accordingly, the component designation revocations made in this rule will take effect March 29, 2017. Revocations are not effective as to any individual terminating senior service prior to the expiration of the 90-day period.

As Director of the Office of Government Ethics, I certify under the Regulatory Flexibility Act (5 U.S.C. chapter 6) that this final rule will not have a significant economic impact on a substantial number of small entities because it affects only Federal departments and agencies and current and former Federal employees.

The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply to this final rule because it does not contain information collection requirements that require the approval of the Office of Management and Budget.

For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. chapter 25, subchapter II), this final rule will not significantly or uniquely affect small governments and will not result in increased expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (as adjusted for inflation) in any one year.

The final rule is not a major rule as defined in 5 U.S.C. chapter 8, Congressional Review of Agency Rulemaking.

In promulgating this final rule, the Office of Government Ethics has adhered to the regulatory philosophy and the applicable principles of regulation set forth in Executive Orders 12866 and 13563. This rule has not been reviewed by the Office of Management and Budget under Executive Order 12866 because it is not a “significant” regulatory action for the purposes of that order.

As Director of the Office of Government Ethics, I have reviewed this final rule in light of section 3 of Executive Order 12988, Civil Justice Reform, and certify that it meets the applicable standards provided therein.

Accordingly, for the reasons set forth in the preamble, the Office of Government Ethics is amending 5 CFR part 2641 as set forth below:

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to remove AD 2010-21-07, Amendment 39-16467 (75 FR 63052, October 14, 2010) and add a new AD. AD 2010-21-07 required repetitively inspecting the pilot's and co-pilot's throttle twist for proper operation of the contactors, which provide for changes between the “IDLE” and “FLIGHT” positions of the throttle twist grip control. The NPRM published in the Federal Register on July 30, 2014 (79 FR 44142), and proposed to retain the inspection requirements of AD 2010-21-07 and included additional requirements to inspect for proper operation of contactors 53Ka and 53Kb and the pilot and copilot throttle twist grip controls for proper functioning. The NPRM also proposed to reduce the intervals of the inspections from 600 hours time-in-service (TIS) to 300 hours TIS.

The NPRM was prompted by AD No. 2013-0191-E, dated August 22, 2013, issued by EASA, which is the Technical Agent for the Member States of the European Union. EASA advises that the switches in the engine “IDLE” or “FLIGHT” control system could be affected by the corrosive effects of a salt-laden atmosphere, which could lead to engine power loss. EASA states that these corrosive effects are not prevented by MOD 074263, which Eurocopter designed to address the unsafe condition identified in AD 2010-21-07. According to EASA, a subsequent accident occurred which involved power loss in flight of a Model AS350B3 helicopter with MOD 074263 installed. As a result, EASA AD No. 2013-0191-E does not accept MOD 074263 as terminating action for the required repetitive maintenance actions. Accordingly, the two letters we issued approving MOD 074263 as an Alternate Method of Compliance for AD 2010-21-07 are no longer valid.

After our NPRM (79 FR 44142, July 30, 2014) was published, we received comments from three commenters.

Two commenters requested that we change the compliance times for the recurring inspection to allow for a longer compliance time for helicopters that do not operate in corrosive or salt laden environments. One commenter noted that the failures have been attributed to operations in a corrosive environment. The other commenter stated the proposed AD would penalize operators in non-salt laden environments by requiring the shorter compliance time. The commenters also requested that we adopt the same compliance intervals, 330 hours TIS or 660 hours TIS for helicopters that do not operate in salt laden environments, allowed by the manufacturer's service information. The commenters stated that this would facilitate maintenance scheduling.

We agree. We are adding a longer recurring inspection compliance interval for helicopters that do not operate in salt laden conditions to match the manufacturer's service information. We have also increased the compliance intervals for the recurring inspection to 330 hours TIS for helicopters operating in salt-laden environments and to 660 hours TIS for all other helicopters.

One commenter requested that the proposed AD condition compliance with paragraph 3.B.2 of the manufacturer's service information on the results of the inspection in paragraph 3.B.1. The commenter noted that the proposed AD requires compliance with paragraph 3.B.1 through 3.B.6 of the service information, but does not clarify that compliance with paragraph 3.B.2 is only required if the aircraft fails the prior inspection.

We agree that compliance with paragraph 3.B.2 of the service information is conditional, but we do not agree that a change to the AD language is necessary. There is no ambiguity in the service information incorporated by reference in the AD as to when compliance with paragraph 3.B.2 is necessary.

We have reviewed the relevant information and determined that an unsafe condition exists and is likely to exist or develop on other helicopters of these same type designs and that air safety and the public interest require adopting the AD requirements as proposed, except for the changes described previously. We have also changed the service information that is incorporated by reference to the most current revision. These changes are consistent with the intent of the proposals in the NPRM (79 FR 44142, July 30, 2014) and will not increase the economic burden on any operator nor increase the scope of the AD.

We consider this AD interim action. The design approval holder 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.

Since we published the NPRM (79 FR 44142, July 30, 2014), Airbus Helicopters (previously Eurocopter) revised its service information. We reviewed one document that co-publishes 3 Emergency Alert Service Bulletin (EASB) identification numbers: No. 05.00.61, Revision 3, dated June 15, 2015, for Model AS350B3 helicopters; No. 05.00.41, Revision 2, dated June 15, 2015, for the non-FAA type-certificated Model AS550C3 helicopter; and No. 05A009, Revision 3, dated June 15, 2015, for Model EC130B4 helicopters. EASB Nos. 05.00.61 and 05A009 are incorporated by reference in this AD. EASB No. 05.00.41 is not incorporated by reference in this AD.

This service information describes procedures for a functional check and installation of a protection for micro-contacts (microswitches) 53Ka, 53Kb, and 65K (IDLE/FLIGHT mode). EASA classified the prior revision of this service information as mandatory and issued EASA Emergency AD No. 2013-0191-E, dated August 22, 2013, to ensure the continued airworthiness of these helicopters.

Because this revision of EASB No. 05.00.61 and No. 05A009 specifies the same actions but clarifies the procedures used in applying varnish to the microswitches, we are incorporating this revision by reference in this AD.

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.

We estimate that this AD will affect 517 helicopters of U.S. Registry.

We estimate that operators will incur the following costs in order to comply with this AD. The average labor rate is $85 per work hour. It will take about 4 work hours for the inspections and any necessary maintenance, for a total cost of $340 per helicopter and $175,780 for the U.S. fleet per inspection cycle.

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

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

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

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

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

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

(3) Will not affect intrastate aviation in Alaska to the extent that a regulatory distinction is required, and

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

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

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all The Boeing Company Model MD-90-30 airplanes. The NPRM published in the Federal Register on June 13, 2016 (81 FR 38113) (“the NPRM”). The NPRM was prompted by reports of stick shaker activation at airspeeds that were above the stall protection system's stick shaker schedule. The NPRM proposed to require installing AOA sensor external case heaters on the existing AOA sensors, installing additional wires, and doing a functional test and applicable corrective actions. We are issuing this AD to prevent ice formation between the AOA sensor vane and face plate, which could cause both vanes to become immobilized. If both vanes become immobilized, the stall protection system could become unreliable or non-functional, which could result in loss of control of the airplane.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM and the FAA's response to each comment.

The Air Line Pilots Association, International provided comments that supported the intent of the NPRM.

Boeing asked that we change its mailing address for obtaining copies of service information as specified in the NPRM to the following: Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1092; Internet https://www.myboeingfleet.com. Boeing stated that this address is valid for this and all future ADs affecting Boeing airplanes.

We agree with the commenter's request. We have updated the contact information accordingly. However, we have corrected the telephone number; it should be 562-797-1717. We have changed this AD to include this new mailing address for Boeing service information.

Boeing asked that we clarify the language specifying what prompted the AD action, and the description of the unsafe condition, as specified in the SUMMARY section. Boeing stated that the reported incident occurred “on Model 717-200 airplanes” and included further description of what prompted the AD action. Boeing also stated that including this description clarifies the airplane model on which the safety issue was identified. Boeing also asked that we revise the description of the unsafe condition, which stated that “the vane” could become immobilized. Boeing noted that the safety issue is a common cause failure (both vanes could become immobilized) due to an external threat (i.e., weather).

We agree to add “both vanes” to the Discussion section and paragraph (e) of this AD for clarification. Information concerning the origin of the safety issue on Model 717-200 airplanes was included in the Discussion section of the NPRM. Since the information in the Discussion section of the NPRM does not reappear in the final rule, we have not changed this AD in this regard. In addition, we do not agree that the requested changes are necessary in the SUMMARY section, which merely provides a high-level description of the relevant information. Details concerning the unsafe condition that appeared in the SUMMARY section of the NPRM have been removed from this final rule in response to new guidance from the Office of the Federal Register.

Boeing also asked that we clarify the AD requirements by specifying “installing additional wires” in lieu of “changing wires” and installing AOA sensor external case heaters “on the AOA sensors” in lieu of “and AOA sensors.” Delta Air Lines (Delta) asked that we change “and AOA sensors” to “and existing AOA sensors” since they are not new sensors.

We agree to make the requested changes in the SUMMARY section, the Discussion and the Related Service Information under 1 CFR part 51 sections of this final rule, and in paragraph (g) of this AD for clarification.

Delta asked that we remove the references to “water intrusion” from the NPRM related to the description of the unsafe condition. Delta stated that the referenced service information does not address water intrusion. Delta added that the installation of the external case heater only prevents the existing water from freezing and rendering the vane immobilized. UTC Aerospace Systems (UTC) also asked that we remove the reference to moisture (water) intrusion since the referenced service information does nothing to reduce or eliminate the problem; it simply keeps the water from freezing. UTC also asked that we add to the description of the unsafe condition that the AD is intended to reduce or eliminate ice formation between the AOA sensor vane and face plate.

We partially agree with the commenters' requests. Water intrusion is addressed in the referenced service information since it contributes to ice formation between the AOA sensor vane and face plate. However, water intrusion is not corrected by this AD. Therefore, we have revised the Discussion section and paragraph (e) of this AD to state “We are issuing this AD to prevent ice formation between the angle-of-attack (AOA) sensor vane and face plate.”

UTC asked that we re-identify the corrective actions in the SUMMARY and Discussion sections of the NPRM as removing and replacing the existing AOA unit having part number (P/N) 0861EW1 with a certified AOA, or installing a new AOA in accordance with the instructions specified in Boeing Alert Service Bulletin MD90-30A029, dated November 25, 2015. UTC stated that this would clarify the potential cause of the problem as related to the subject AOA and provide another choice for operators to comply with the proposed AD. UTC added that this would also define the AOA replacement as not including the existing AOA unit having P/N 0861EW1.

We agree that clarification is necessary; however, we do not agree that this clarification should be included in the SUMMARY section and the Discussion section of this final rule. The purpose of the language in the SUMMARY section is to provide a high-level description of the relevant information, and the information in the Discussion section of the NPRM does not reappear in the final rule. Therefore, we have revised the description of the required actions in the Related Service Information under 1 CFR part 51 section of this final rule, as specified by the commenter, to provide clarification to operators. We have also included the correct part number for the existing AOA unit in paragraph (g) of this AD.

UTC asked that Boeing Alert Service Bulletin MD90-30A029, dated November 25, 2015, be updated to correct the part number for the AOA sensor identified therein. UTC stated that the service information identifies replacing any AOA sensor having P/N “081EW1,” but the correct part number is “0861EW1.”

We acknowledge the commenter's concern; however, Boeing Alert Service Bulletin MD90-30A029, dated November 25, 2015, has not yet been revised by the airplane manufacturer. We have confirmed that this part number does not exist, and have clarified the correct part number for the existing AOA sensor in paragraph (g) of this AD.

Boeing asked that we change the Costs of Compliance section of the NPRM to include the parts cost for the external case heaters, as provided by the supplier. Boeing stated that the supplier of these heaters has received FAA parts manufacturer approval (PMA), which allows operators to go directly to the supplier to procure the parts. Boeing noted that the parts cost for two heaters is $2,389 each, for a total of $4,778 (operators are required to purchase two external case heaters for installation).

We agree with the commenter's request for the reason provided. We have changed the Costs of Compliance section in this final rule accordingly.

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

• Are consistent with the intent that was proposed in the NPRM for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM.

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

We reviewed Boeing Alert Service Bulletin MD90-30A029, dated November 25, 2015. The service information describes procedures for installing AOA sensor external case heaters on the existing AOA sensors, installing additional wires, and doing a functional test and applicable corrective actions. The applicable corrective actions include removing and replacing the existing AOA unit (P/N 0861EW1) with a certified AOA, or installing a new AOA. 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.

We estimate that this AD affects 95 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

Background

On December 16, 2016, the FAA published a final rule entitled, “Qualification, Service, and Use of Crewmembers and Aircraft Dispatchers; Related Aircraft Amendment.” 81 FR 90979. In that final rule, effective January 17, 2017, the FAA inadvertently listed the incorrect Amendment Number for part 121 in the header information of the final rule as 121-397. The correct amendment number is 121-377.

In the final rule, FR Doc. 2016-30211, published on December 16, 2016, at 81 FR 90979 make the following correction:

1. On page 90979 in the heading of the final rule, revise “Amdt. No. 121-397” to read as “121-377”.

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

By Resolution No. 2016-8 on December 14, 2016 the Commission approved a comprehensive revision of its project review fee structure, including an automatic annual indexed inflation adjustment for most fees. An inflation adjustment was also approved for DRBC's water supply charges rates applicable to consumptive and non-consumptive surface water withdrawals. The changes to DRBC's regulatory program fees are designed to provide a more predictable and sustainable source of revenues and to close the annual gap in funding needed to support DRBC's project review program. They also adjust the fees program to better align with the One Process/One Permit Program instituted earlier in 2016. The changes to DRBC's water supply charges regulations are designed to help revenues assigned to DRBC's Water Supply Storage Facilities Fund keep pace with inflation.

Public Process. A Notice of Proposed Rulemaking and Public Hearing was posted to the Commission's Web site on May 9, 2016. A detailed set of questions and answers about the proposal (“FAQs”) and a press release accompanied the May 9, 2016 web posting. On May 10, 2016, an email alert, including a link to the notice and supporting documents, was transmitted to all parties subscribed to DRBC's list serve. Notice of the proposed rules was published in the Federal Register at 81 FR 35662, June 3, 2016 and appeared in the Delaware Register of Regulations, 19 DE Reg., 1052, June 1, 2016; New Jersey Register, 48 N.J.R. 949, June 6, 2016; New York State Register, May 25, 2016 (page 1); and Pennsylvania Bulletin, 46 Pa.B. 2967, June 11, 2016. DRBC staff hosted a public informational meeting on the proposal on Wednesday, June 15, 2016 in Washington Crossing, Pa., including presentations by staff and informal questions and answers. The FAQs posted on the Commission's Web site were thereafter supplemented with questions and responses offered during the informational meeting. A public hearing on the proposed amendments took place at the Commission's office building in West Trenton, N.J. on July 27, 2016 and written comments were accepted through August 12, 2016.

In response to the written and oral comments submitted on the draft rules, staff developed a detailed comment and response document, including modest changes to the rule text. After careful consideration and consultation with staff on the comments and proposed changes to the draft rules, the Commissioners determined that the changes were appropriate, responsive to the public's concerns and a logical outgrowth of the rules as proposed. The changes and the staff response to comments were adopted by unanimous vote of the Commissioners to approve Resolution No. 2016-8 at the Commission's public business meeting on December 14, 2016.

Additional materials. The following additional materials can be found on the Commission's Web site, www.drbc.net:

• Resolution No. 2016-8, at http://www.nj.gov/drbc/library/documents/Res2016-09_Fee-Rule.pdf. Attachments to the resolution include a redline version of the regulatory program fees rule text, showing changes between the draft and final versions of the new rule; and a redline version of the schedule of water charges, comparing the text that has been in place since 2011 with the text of this final rule.

• The detailed comment and response document prepared by staff and adopted by the Commission when it approved the final rule on December 14, 2016, at http://www.nj.gov/drbc/library/documents/regs/CR_fees-rulemaking121416.pdf.

• A questions and answers document (“FAQs”) prepared by staff to explain the purpose and effect of the rule changes, at http://www.nj.gov/drbc/library/documents/FAQ_fees-charges121416.pdf.

• The Commission's press release dated December 14, 2016, announcing adoption of the project review fees restructuring and amendment of the schedule of water charges, at http://www.nj.gov/drbc/home/newsroom/news/approved/20161214_newsrel_fees.html.

• Updated versions of the Rules of Practice and Procedure and the Basin Regulations—Water Supply Charges, at http://www.nj.gov/drbc/about/regulations/.

For the reasons set forth in the preamble, the Delaware River Basin Commission amends parts 401 and 420 of title 18 of the Code of Federal Regulations as set forth below:

I. Executive Summary A. Purpose of the Rule

FDA is issuing this refuse to accept rule to identify deficiencies that will result in FDA's refusal to accept certain tobacco product submissions under sections 905, 910, and 911 of the Federal Food, Drug, and Cosmetic Act (the FD&C Act), as amended by the Family Smoking Prevention and Tobacco Control Act (Tobacco Control Act) (21 U.S.C. 387e, 387j, and 387k).1 Because these submissions will be refused before they enter FDA's review queue, more resources will be available for submissions that are ready for further review. This rule establishes a refuse to accept process for premarket tobacco product submissions, including premarket tobacco product applications (PMTAs), modified risk tobacco product applications (MRTPAs), substantial equivalence (SE) applications (also called SE reports), and exemption requests (including subsequent abbreviated reports).

The rule explains when FDA will refuse to accept a premarket submission, including PMTAs, MRTPAs, SE applications, and exemption requests (including subsequent abbreviated reports). The rule is based on FDA's experience in reviewing these submissions. Under the rule, FDA will refuse to accept a premarket submission that: (1) Does not pertain to a tobacco product; (2) is not in English (or does not include a complete translation); (3) is submitted in an electronic format that FDA cannot process, read, review, or archive; (4) does not include the applicant's contact information; (5) is from a foreign applicant and does not include the name and contact information of an authorized U.S. agent (authorized to act on behalf of the applicant for the submission); (6) does not include a required form(s); (7) does not identify the tobacco product; (8) does not identify the type of submission; (9) does not include the signature of a responsible official authorized to represent the applicant; or (10) does not include an environmental assessment or claim of a categorical exclusion, if applicable. Under the rule, if FDA refuses to accept the submission, FDA will send the contact (if available) a notification. If the submission is accepted for further review, FDA will send an acknowledgement letter.

FDA published two rulemaking documents concerning refuse to accept procedures in the Federal Register of August 8, 2016: A direct final rule (81 FR 52329) and a companion proposed rule (81 FR 52371). We published the direct final rule because we believed that the rule was noncontroversial, and we did not anticipate that it would receive any significant adverse comments. As a companion to the direct final rule, we published a proposed rule with the same codified language published in the proposed rules section of the Federal Register. The companion proposed rule provides a procedural framework to finalize the rule in the event that the direct final rule receives any adverse comment and is withdrawn. We received adverse comment on the direct final rule and withdrew the direct final rule by issuing a notice in the Federal Register of November 16, 2016 (81 FR 80567). We are now finalizing the proposed rule and responding to the comments we received.

FDA is issuing this refuse to accept rule to efficiently handle submissions that do not meet a threshold of acceptability for FDA review (e.g., the submission lacks certain information FDA needs for substantive review of the submission). Currently, FDA often expends extensive time and resources in attempts to obtain information and resolve the deficiencies identified in the rule simply to begin substantively processing the submission. FDA expects that this rule will enhance the quality of the submissions and that submissions will move expeditiously through the review process. In addition, this rule will help submitters better understand the common hurdles FDA encounters in conducting a substantive review of submissions.

The rule identifies deficiencies that FDA has seen across types of premarket submissions and will result in FDA refusing to accept the submission. This rule applies to all tobacco product applications; we note that there are additional deficiencies that are not covered in this rule that may arise for specific types of premarket submissions that would also result in FDA's refusal to accept that specific type of premarket submission (e.g., omission of labeling for a PMTA that is required under section 910(b)(1)(F) of the FD&C Act).

FDA's refusal to accept a tobacco product submission does not preclude an applicant from resubmitting a new submission that addresses the deficiencies. In addition, acceptance of a submission does not mean that FDA has determined that the submission is complete, rather only that the submission meets the basic, minimum threshold for acceptance. Substantive review of the submission will begin once FDA accepts the submission, and for submissions with filing requirements (i.e., PMTAs and MRPTAs), once filed. This rule establishes a general process for refusing to accept submissions for premarket tobacco review, including PMTAs, MRTPAs, SE applications, and exemption requests (including subsequent abbreviated reports). Because administratively incomplete submissions will be refused before FDA begins substantive review, we will be able to use our resources on submissions that are more complete and better prepared for further review. In addition, FDA intends to determine, as soon as practicable, whether the submission will be accepted. We intend to determine whether we will refuse to accept most premarket submissions under this rule by 21 to 60 days of receipt, with less lengthy submissions, such as some exemption requests, taking closer to 21 days or fewer and other more lengthy submissions taking closer to 60 days or fewer; however, this range is an initial estimate and the actual time required may vary depending on the volume of submissions received at any one time. FDA remains committed to an efficient product review process and intends to establish and implement performance goals for this action once it has experience with the volume of submissions it will receive for newly deemed tobacco products. FDA expects the performance goals to be generally similar to other Agency performance goals, i.e. a certain percentage of refuse to accept determinations made within a defined period of time, and with the percentage rising over time.

Section 701(a) of the FD&C Act (21 U.S.C. 371(a)) provides FDA with the authority to issue regulations for the efficient enforcement of the FD&C Act. This rule will allow FDA to more efficiently use our resources to review premarket submissions under sections 905, 910, and 911 of the FD&C Act. FDA has processed and reviewed many submissions since the enactment of the Tobacco Control Act, and submissions with the deficiencies identified in the rule have been repeatedly identified by FDA as reflecting submissions that are incomplete and not prepared for further review.

We are finalizing the proposed rule with only editorial changes. The rule adds part 1105 (21 CFR part 1105) to title 21, specifically § 1105.10. Section 1105.10 provides that FDA will refuse to accept, as soon as practicable, PMTAs, MRTPAs, SE applications, and exemption requests (including subsequent abbreviated reports) for the reasons listed in paragraphs (a)(1) through (a)(10), if applicable.

We consider any comments that were submitted on the direct final rule to have been submitted on the proposed rule. We received two sets of comments on the proposed rule, one from a tobacco product manufacturer and another from a public health group. In general, one of the commenters expressed strong support for this rule, asking that it be applied to a broader set of applications, while the other commenter identified concerns with the rulemaking, including that “promulgating a direct final rule was procedurally improper.” This commenter suggested that FDA withdraw the rule in its entirety and issue any future rule only after engaging in notice and comment rulemaking. This rulemaking, however, did provide both notice and an opportunity for comments. As previously noted, FDA withdrew the direct final rule and is proceeding with the rulemaking under the procedural framework of the proposed rule. FDA has considered the comments submitted to the docket for the rulemaking and responds to the comments in the following paragraphs.

To make it easier to identify comments and our responses, the word “Comment,” in parentheses, will appear before each comment, and the word “Response,” in parentheses, will appear before each response. We have numbered the comments to make it easier to distinguish between comments; the numbers are for organizational purposes only and do not reflect the order in which we received the comments or any value associated with the comment. We have combined similar comments under one numbered comment.

(Comment 1) One commenter suggested that FDA apply the rule to provisional substantial equivalence applications submitted by manufacturers under section 910(a)(2)(B) of the FD&C Act for new tobacco products that were first introduced or delivered for introduction into interstate commerce between February 15, 2007, and March 22, 2011.

(Response) FDA disagrees with this comment. We do not believe that this rule should be applied retroactively to refuse to accept submissions submitted before the rule is effective. While the refuse to accept criteria represent a minimum threshold that applications should be able to meet, we believe that applying this rule retroactively would be unfair to applicants because they had no notice that they would be subject to the rule's requirements.

(Comment 2) One commenter suggested that FDA apply this “commonsense regulation” to premarket submissions for newly deemed tobacco products submitted during the compliance period announced in the Deeming rule.

(Response) FDA notes that, as explained in the proposed rule, the rule once effective, will apply to premarket submissions for all tobacco products, including those that are for products covered by the Deeming rule.

(Comment 3) One commenter requested that FDA revise and expand the requirements of the rule to allow FDA to refuse to accept substantial equivalence applications that fail to comply with certain criteria that relate to the substantial equivalence pathway, such as creating product-identifying information requirements for predicate products.

(Response) FDA disagrees with this comment. The rule creates a minimum threshold of acceptability for all premarket submissions, regardless of the type of submission, and is not intended to address content specific to only one type of premarket submission. FDA plans to consider including refuse to accept criteria that are specific to a particular premarket pathway as part of future rulemakings. For example, FDA has already issued one such rule, “Tobacco Products, Exemptions From Substantial Equivalence Requirements,” which contains refuse to accept criteria relating specifically to exemption requests (July 5, 2011, 76 FR 38961).

(Comment 4) One commenter argued that FDA lacks the legal authority to implement the rule. The commenter stated that because the Tobacco Control Act does not set forth content requirements for substantial equivalence applications or exemption requests, FDA has no statutory justification for pre-review of those submissions. The commenter further stated that while the Tobacco Control Act does set forth content requirements for premarket tobacco product applications and modified risk tobacco product applications that grant FDA authority to conduct filing reviews of those submissions, FDA lacks the statutory authority to conduct a separate acceptance review as part of the pre-review of an application. In sum, the commenter argued that FDA does not have the statutory authority, either explicit or implicit, to refuse to accept tobacco product submissions.

(Response) FDA disagrees with this comment. As described in section III.B of the rule, section 701(a) grants FDA the authority to issue regulations for the efficient enforcement of the FD&C Act. As also discussed in the proposed rule, this rule will allow FDA to efficiently enforce the premarket review requirements of sections 905, 910, and 911 of the FD&C Act by allowing FDA to refuse to accept submissions that do not meet basic criteria and focus its resources on those submissions that are ready for review.

(Comment 5) One commenter argued that unless FDA establishes a time by which FDA will refuse to accept a premarket submission, the rule is legally problematic for a number of reasons. While two of the specific reasons are discussed in this document in separate comments and responses, overall, the commenter suggested that FDA should, similar to its approach for new drug applications and premarket approval applications for medical devices, create a limit of 15 days in which to determine whether it will refuse to accept a premarket submission.

(Response) FDA declines the suggestion that FDA adopt a 15-day time limit similar to the refuse to accept review periods for refuse to accept notifications for 510(k) and premarket approval applications established by the Center for Devices and Radiological Health (CDRH). CDRH has had a significantly longer time reviewing such applications and has gained extensive experience doing so. CTP currently lacks sufficient experience reviewing tobacco product submissions to develop specific timeframes. Moreover, there is some uncertainty regarding the types and number of applications that manufacturers will choose to submit for products covered by the Deeming rule and regarding the precise timing of such submissions. Given the size of the industry and the number of newly deemed products on the market, FDA anticipates a large influx of applications, many of which could be at the end of the initial compliance periods for each premarket pathway. It is likely that many applicants will have no experience with the FDA premarket review process, so the quality of the submissions is likewise very difficult to predict. Due to this uncertainty and the difficulty predicting the level of resources FDA will have to expend as a result, FDA is not prepared at this time to commit to a single time limit for all submissions. Instead, FDA is providing an estimated timeframe in which it intends to determine whether to accept submissions: FDA intends to make the determination of whether it will accept an application for review based upon the requirements in the rule by 21 to 60 days of receipt. Further, we intend to establish performance goals or other timeframes once we gain sufficient experience.

(Comment 6) One commenter argues that the absence of a time limit in the rule poses a problem under the First Amendment. Specifically, the commenter alleges that FDA's premarket review of tobacco product submissions, particularly with regard to MRTPAs, are prior restraints on speech; thus, the lack of a time limit for FDA to make acceptance determinations allows the Agency to delay the applicant's truthful and non-misleading speech indefinitely.

(Response) FDA disagrees with the commenter's assertion that the rule's provisions are problematic under the First Amendment. First, as the commenter acknowledges in a footnote, members of the tobacco industry challenged the MRTP provisions, including the absence of a time limit, on First Amendment grounds, and the Sixth Circuit rejected that challenge and upheld the MRTP provisions (Discount Tobacco v. United States, 674 F.3d 509, 537 (6th Cir. 2012)). Second, the premarket review process is not unique to FDA's regulation of tobacco and in fact is employed widely across most of FDA's product areas. The commenter singles out the MRTP review process as particularly problematic, but they misapprehend the structure of the provision, which imposes no direct restriction on speech. Rather, it requires premarket review before a product may be introduced into interstate commerce and defines such product in part by reference to its promotional claims. Courts have upheld FDA premarket reviews in other product areas based on a similar scheme. See, e.g., United States v. LeBeau, 2016 U.S. App. LEXIS 12375 (7th Cir. 2016); Whitaker v. Thompson, 353 F.3d 947 (D.C. Cir. 2004); United States v. Cole, 84 F. Supp. 3d 1159, 1166 (D. Or. 2015). Third, there is a split in authority regarding whether the prior restraint doctrine applies to commercial speech; the Sixth Circuit in Discount Tobacco found that the doctrine did not apply to evaluation of the MRTP provisions (674 F.3d at 532-33). Fourth, even assuming that the marketing of a tobacco product is speech to which the prior restraint doctrine could possibly apply, the process established here would satify the requirements of that doctrine. First, prior restraints are not acceptable where they place “unbridled discretion in the hands of a government official or agency.” (FW/PBS, Inc. v. Dallas, 493 U.S. 215, 225-226 (1990) (plurality opinion).) Here, however, the rule lays out 10 basic requirements for tobacco product applications which, if not met, will cause FDA to refuse to accept the submission. Further, when assessing whether a submission meets that minimum threshold of acceptability, FDA will look only to whether the submission is facially complete and it will not conduct a substantive review. Second, the prior restraint doctrine requires that decisions “must be issued within a reasonable period of time.” (City of Littleton v. Z.J. Gifts D-4, L.L.C, 541 U.S. 774, 780 (2004).) For instance, in a case involving FDA premarket review of health claims for dietary supplements, the Second Circuit held that a 540-day period was permissible “given the need to protect consumers before any harm occurs,” to “evaluate the evidence in support of labeling claims,” and to develop “a record on the matter so that a court can determine whether the regulated speech is, in fact, truthful and non-misleading.” (Nutritional Health Alliance v. Shalala, 144 F.3d 220 (2d Cir. 1998).) Furthermore, as the district court in the Discount Tobacco case noted, the Administrative Procedure Act (APA) “imposes a general but nondiscretionary duty upon an administrative agency to pass upon a matter presented to it `within a reasonable time,' 5 U.S.C. 555(b), and authorizes a reviewing court to `compel agency action unlawfully withheld or unreasonably delayed,' 5 U.S.C. 706(1).” (Commonwealth Brands, Inc. v. United States, 678 F. Supp. 2d 512, 533 (W.D. Ky. 2010).) The APA requirement that the Agency act on matters before it “within a reasonable time,” in conjunction with FDA's estimated timeframes and the performance goals for refuse to accept review that FDA intends to establish, indicate that FDA will not leave applications “in limbo,” as claimed by the commenter, but will act on them in a reasonable amount of time. For all of these reasons, the rule's provisions do not constitute an unconstitutional prior restraint.

(Comment 7) One commenter argued that implementing the rule would allow FDA to deprive manufacturers of the valuable substantive right to market their products during the compliance period for deemed products with no hearing and no substantive review, which is contrary to Congress' intent in the Tobacco Control Act. The commenter further argued that the Tobacco Control Act allows FDA to require certain tobacco products to be taken off of the market only upon making a substantive determination that the action is warranted under statutory standards, and thus FDA cannot require that products be removed from the market without any such substantive review.

(Response) FDA disagrees with this comment. Under the FD&C Act, generally, a new tobacco product may not be introduced or delivered for introduction into interstate commerce unless it is subject to a marketing order under section 910(c)(1)(A)(i), FDA has issued an order finding the new tobacco product substantially equivalent to a predicate product, or FDA has issued an exemption from the requirements of substantial equivalence. The final Deeming rule, issued with notice and an opportunity for comment, extends this requirement to newly regulated products that are not grandfathered (i.e., marketed as of February 15, 2007). Thus, as of August 8, 2016, marketing these products without FDA authorization is prohibited by statute. However, FDA is affording staggered compliance periods during which FDA does not intend to enforce the premarket review requirements. These compliance periods are general statements of policy that do not establish any rights for any person, and are not binding on FDA or the public. (See e.g., Professionals and Patients for Customized Care v. Shalala, 56 F.3d 592 (5th Cir. 1995).) The commenter gives a vague reference to the rule depriving manufacturers of a “substantive right” to market with no hearing or substantive review, but without citing any authority for such a right. Irrespective of the rule, a manufacturer does not have a right to market a product that is in violation of the FD&C Act because it does not have a required premarket authorization.

(Comment 8) One commenter stated that FDA should allow manufacturers to amend applications that FDA finds to be deficient and consider the amended applications to be received as of their original submission dates. The commenter explained that this approach would not tie up Agency resources because FDA could simply notify an applicant of any deficiencies and suspend substantive review until the applicant resolves those issues and, as such, there is no valid reason for requiring that applications be resubmitted rather than amended.

(Response) FDA disagrees with this suggestion. Creating a queue of deficient premarket submissions that FDA must track and manage is the type of inefficient process that FDA seeks to eliminate from the premarket submission review process with the rule. A queue for plainly deficient submissions will require a redirection of FDA resources away from more complete, quality submissions. Additionally, we disagree with the suggestion that we should consider amended submissions to have been received by the original submission date. This would allow manufacturers to submit woefully deficient premarket submissions and rely on FDA to identify deficiencies to be resolved.

(Comment 9) One commenter argued that FDA should withdraw the rule and instead issue rules specifying the content that must be contained in each type of application because without such application-specific rules, the rule is unconstitutionally vague. The commenter further explained that without the promulgation of such content regulations, it considers the rule to violate the Due Process Clause of the 5th Amendment as well as the APA because it would allow FDA to deny applications without fully explaining application content requirements to applicants. Additionally, the comment asserts that the rule is unduly vague under the Due Process Clause and the APA on the basis that some of the criteria are either “ill-defined or entirely undefined.”

(Response) FDA disagrees with this comment. The rule is not impermissibly vague as it provides applicants with fair notice of 10 criteria by which FDA will refuse to accept a premarket submission. These criteria are not specific to the requirements of any one premarket pathway but instead include basic parameters that apply to all premarket submissions. Detailed criteria that are specific to each premarket pathway are not necessary to implementing a rule that applies to all types of premarket submissions generally without any consideration of content specific to each premarket pathway. Any additional grounds for which FDA may refuse a premarket submission exist independently from this rulemaking; therefore, the vagueness of such grounds, if any, is not attributable to the rule and does not cause it to violate the Due Process clause of the 5th Amendment or the APA. Further, the comment incorrectly asserts that some of the criteria required by the rule are unduly vague under the Due Process Clause and the APA. A law is impermissibly vague if it does not give “a person of ordinary intelligence a reasonable opportunity to know what is prohibited.” Grayned v. City of Rockford, 408 U.S. 104, 108 (1972). To the extent that the commenter identifies concerns with specific requirements of the rule, we address them in the responses to comments 10-14; however, FDA believes that the requirements of this rule are sufficiently clear to give submitters a reasonable opportunity to be aware of what information must be included with a tobacco product application.

(Comment 10) One commenter argued that FDA must edit the rule so that it comprehensively states all potential refuse to accept criteria for each premarket pathway and commit to accepting all submissions that meet those specific criteria because granting FDA discretion to refuse to accept submissions on the basis of criteria not specified in this rule violates the principles of fair notice embodied in the Constitution and the APA.

(Response) FDA disagrees. Under § 1105.10(b), FDA “may accept the submission” if it “finds that none of the reasons in paragraph (a) of this section exists for refusing to accept a premarket submission.” The use of the word “may” in this section reflects the fact that this rule addresses the basic threshold of acceptability that all premarket submissions must meet; however it does not address other grounds on which FDA could refuse to accept a specific type of premarket submission, such as the omission of labeling from a PMTA that is required by section 910(b)(1)(F) of the FD&C Act. Any additional grounds on which FDA may refuse to accept a premarket submission exist independently from this rulemaking and are outside of its scope.

(Comment 11) One commenter argues that FDA's discussion in the preamble of the proposed rule regarding “other information” that FDA recommends be included as part of the product-identifying information submitted under § 1105.10(a)(7) should either be deleted or modified to provide a full and complete description of what “other information” applicants should provide. The commenter also suggests that FDA must state whether failure to provide such information would be grounds for FDA to refuse to accept a submission.

(Response) FDA disagrees with this comment. Section 1105.10(a)(7) specifically lists the product-identifying information that is required under the rule: The manufacturer of the tobacco product; the product name, including the brand and subbrand; the product category and subcategory; package type and package quantity; and characterizing flavor. The preamble of the proposed rule notes that other information may be needed to identify the product, such as product descriptors that are not a part of the product name (e.g., premium), but it merely requests such information be submitted to facilitate FDA's review. Failure to include additional product-identifying information beyond those specifically listed in § 1105.10(a)(7) is not grounds for FDA to refuse to accept a submission under the rule.

(Comment 12) One commenter argued that FDA must either remove the requirement in § 1105.10(a)(7) that applicants specify the category and subcategory of the tobacco product or provide a list of all potential categories and subcategories. The commenter further noted that FDA could require a uniform system of product identification under 21 U.S.C. 387e(e) (section 905(e) of the FD&C Act), but it has not yet issued a regulation doing so.

(Response) FDA disagrees with this comment. The rule requires applicants to describe the category and subcategory of the tobacco product that is the subject of the premarket submission. This is a requirement to provide basic product-identifying information, such as describing the product category as “Smokeless Tobacco Product” and the subcategory as “Dissolvable,” which in no way creates a rigid system of product identification with which an applicant must comply.2 Creating an exhaustive product categorization system is not necessary for applicants to describe the product's category and subcategory and in some cases may not allow applicants to accurately describe new tobacco products that fall into novel categories or subcategories. Table 1 in the preamble of the proposed rule provides some recommendations on how an applicant may satisfy this requirement, but it is not intended to be an exhaustive list (for example, although recommendations for waterpipes were not included in table 1, submissions on waterpipes should include similar information). While the table is not an exhaustive list of every tobacco product category and subcategory that exists, manufacturers have enough information to reasonably understand how to comply with the requirement and can provide information based on internal classifications. Applicants unable to identify the category or subcategory of the tobacco product that will be the subject of a premarket submission are encouraged to contact FDA prior to submission.

(Comment 13) One commenter argued that FDA should not require an applicant to identify the submission type as part of a premarket submission because the list of submission types provided to implement § 1105.10(a)(8) is incomplete. To support this statement, the commenter notes that the list in the preamble of the proposed rule does not mention Product Quantity Change SE Reports as a potential premarket submission type.

(Response) FDA disagrees with the suggestion that manufacturers should not be required to identify the type of application they are submitting and that the list of submission types described in the preamble of the proposed rule is incomplete. Identifying the type of submission is necessary for FDA to review a premarket submission because it enables FDA to determine the appropriate decisional standard to apply to a submission (e.g., whether it is a PMTA subject to the requirements of section 910 of the FD&C Act or an MRTPA subject to the requirements of section 911 of the FD&C Act). The commenter is also incorrect in its assertion that the proposed rule's discussion of the types of premarket submissions is incomplete. The only example the commenter provides to support this assertion is the Product Quantity Change SE Reports, which are SE applications. The preamble of the proposed rule described the types of premarket submissions, which are PMTAs, MRTPAs, SE applications, and exemption requests (and subsequent abbreviated reports). Applicants are welcome to provide additional information regarding their submission type, such as specifying that their SE application is being submitted for a product quantity change, provided that the basic submission type remains clear. Applicants unsure of how to identify the type of application that they are submitting are encouraged to contact FDA prior to submission.

(Comment 14) One commenter argued that FDA should remove the requirement that a premarket submission be accompanied by required forms because FDA has yet to require any forms and it is unclear what those forms may eventually require. The commenter stated that if and when FDA creates required forms, it can issue regulations providing how and when the forms must be submitted.

(Response) We disagree with the suggestion that this requirement should be removed from the rule. As described in section IV of the proposed rule, if and when FDA issues any forms it would need to do so in accordance with applicable requirements, e.g., notice and opportunity to comment on such forms in accordance with rulemaking procedures and the Paperwork Reduction Act of 1995 and rulemaking under the APA. We have chosen to include the form submission requirement in this rule to provide notice that the failure to submit any required forms, if and whenever they are issued, will be grounds for refusing to accept a premarket submission.

(Comment 15) One commenter argued that FDA should not require applicants to identify whether a product has a characterizing flavor until FDA has issued a full explanation of what it considers to be a characterizing flavor and how it expects manufacturers to determine what the characterizing flavor of a tobacco product is. The commenter also argued that the requirement to identify a characterizing flavor has no statutory basis and is not necessary to identify a product in light of all other information FDA is requiring, such as the product name, brand, subbrand, category, and subcategory.

(Response) FDA disagrees with this comment. This requirement, along with the other product-identifying information in § 1105.10(a)(7), will identify to FDA the specific tobacco product that is the intended subject of the application. As explained in the preamble to the proposed rule, FDA is requiring this product-identifying information under section 701 of the FD&C Act to efficiently enforce premarket review requirements for tobacco requirements. For example, FDA needs to be able to distinguish between products that have the same brand and subbrand, but different flavors (e.g., brand X menthol or brand X cinnamon). This also helps ensure that FDA ultimately issues an order that addresses the intended tobacco product. For the purposes of the refuse to accept process and to appropriately identify the specific product that is the subject of the submission, FDA is solely looking to see how the applicant identifies the tobacco product as having no characterizing flavor or having a particular characterizing flavor. Thus, for example, a firm would give “menthol” as the characterizing flavor a tobacco product it identifies as “Brand A menthol”. At the acceptance stage, FDA would not review beyond how the product is identified, such as to determine whether the product contains a different or additional characterizing flavor. Applicants that have questions regarding how to describe their product's characterizing flavor are encouraged to contact FDA prior to submission.

(Comment 16) One commenter argued that FDA should either modify the rule so that it contains procedures to resolve disputes regarding whether FDA should have refused to accept an application, or it should specify whether the procedures for internal Agency review of decisions specified in § 10.75 (21 CFR 10.75) applies.

(Response) The procedures for internal Agency review of decisions in § 10.75 apply to a decision of an FDA employee, other than commissioner, on a matter. Applicants seeking review of a refuse to accept decision may use this mechanism or consider other mechanisms set out in part 10. FDA expects, however, that most applicants will find that addressing any deficiencies in the application will quickly resolve issues.

FDA concludes that this rule contains no collection of information. Therefore, clearance by the Office of Management and Budget under the Paperwork Reduction Act of 1995 is not required.

We have analyzed this rule in accordance with the principles set forth in Executive Order 13132. We have determined that the rule does not contain policies that 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. Accordingly, we conclude that the rule does not contain policies that have federalism implications as defined in the Executive Order and, consequently, a federalism summary impact statement is not required.

We have analyzed this rule in accordance with the principles set forth in Executive Order 13175. We have determined that the rule does not contain policies that would 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. Accordingly, we conclude that the rule does not contain policies that have tribal implications as defined in the Executive Order; consequently, a tribal summary impact statement is not required.

We have determined under 21 CFR 25.30(h) that this action is of a type that does not individually or cumulatively have a significant effect on the human environment. Therefore, neither an environmental assessment nor an environmental impact statement is required.

We have examined the impacts of the rule under Executive Order 12866, Executive Order 13563, the Regulatory Flexibility Act (5 U.S.C. 601-612), and the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4). Executive Orders 12866 and 13563 direct us to assess all costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety, and other advantages; distributive impacts; and equity). We believe that this rule is not a significant regulatory action as defined by Executive Order 12866.

The Regulatory Flexibility Act requires us to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because this rule establishes a procedure that FDA is responsible for implementing and has the effect of providing all entities useful feedback on the readiness of a submission, we certify that the rule will not have a significant economic impact on a substantial number of small entities.

The Unfunded Mandates Reform Act of 1995 (section 202(a)) requires us to prepare a written statement, which includes an assessment of anticipated costs and benefits, before proposing “any rule that includes any Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100,000,000 or more (adjusted annually for inflation) in any one year.” The current threshold after adjustment for inflation is $146 million, using the most current (2015) Implicit Price Deflator for the Gross Domestic Product. This rule does not result in expenditure in any year that meets or exceeds this amount.

This rule identifies 10 significant and common deficiencies in premarket tobacco submissions that will cause FDA to refuse to accept them. Encouraging submissions that are free of the deficiencies listed in this rule does not represent a change in Agency expectations. One of the 10 deficiencies is required by statute (i.e., must be a tobacco product). One of the deficiencies is required by another regulation (i.e., must comply with requirements related to environmental assessments or exclusions from such assessments). The remaining eight deficiencies are basic expectations for an application to enter the review process. Therefore, this rule clarifies these expectations. This clarification will result in cost savings for both the applicant and FDA as less time is spent by FDA working with applicants to address these significant deficiencies. Applicants have clarity about basic expectations regarding requirements for acceptance of premarket applications. In addition, refusing to accept submissions with these deficiencies will allow Agency staff to more efficiently process submissions and quickly move those submissions without these deficiencies into review of substantial scientific issues.

The interim final rule, as directed by the FOIA Improvement Act of 2016, Public Law 114-185, updates the Commission's FOIA regulations to reflect substantive and procedural changes to the FOIA and updates the addresses of two district offices and the Office of Legal Counsel's fax number.

On June 30, 2016, President Obama signed the FOIA Improvement Act of 2016 (“Act”). The Act requires agencies to update FOIA regulations to conform to the Act by:

• Requiring federal agencies to make available their disclosable records and documents for public inspection in an electronic format;

• making available for inspection in an electronic format records that have been requested three or more times (frequently requested records);

• requiring that the Annual FOIA data be downloadable;

• prohibiting agencies from charging a fee for providing records if the agency misses a deadline for complying with a FOIA request unless unusual circumstances apply and more than 5,000 pages are necessary to respond to the request;

• prohibiting agencies from withholding information requested under FOIA Exemption (b)(5) unless the agency reasonably foresees that disclosure would harm an interest protected by a FOIA exemption or disclosure is prohibited by law;

• codifying the Administration's presumption of openness;

• requiring that agencies consider partial disclosures;

• requiring that agencies take steps to segregate and release nonexempt information;

• limiting the FOIA exemption for agency communications, (b)(5), to allow the disclosure of agency “deliberative process” records created 25 years or more before the date of a FOIA request;

• requiring the Office of Government Information Services (OGIS) to offer mediation services to resolve disputes between agencies and FOIA requesters;

• expanding the authority and duties of the Chief FOIA Officer of each agency to require officers to serve as the primary agency liaison with OGIS and the Office of Information Policy;

• establishing a Chief FOIA Officer Council to develop recommendations for increasing compliance and efficiency in responding to FOIA requests; disseminating information about agency experiences; identifying, developing, and coordinating initiatives to increase transparency and compliance; and promoting performance measures to ensure agency compliance with FOIA requirements; and

• requiring the Director of the Office of Management and Budget to ensure the operation of a consolidated online request portal that allows a member of the public to submit a request for records to any agency from a single Web site;

In order to assist agencies and encourage consistency in FOIA practices across the government, the Department of Justice, Office of Information Policy (OIP), created a FOIA template for agencies to use as agencies publish and update their regulations. The template, which is located at https://www.justice.gov/oip/template-agency-foia-regulations, provides sample regulation language. The proposed language contained in these revised FOIA regulations utilizes the language provided in the Act or contained in OIP's template. In order to conform the Commission's FOIA regulations to the requirements of the Act, the proposed rule revises the following sections of 29 CFR part 1610:

• § 1610.1 (Definitions section is revised to utilize OIP's FOIA template);

• § 1610.2 (Statutory requirements section is revised to utilize OIP's template language);

• § 1610.3 (Purpose and scope section is revised to utilize OIP's template language);

• § 1610.4 (Public reference facilities and current index section is revised to utilize OIP's template language, reflect requirements of the Act, and update District Office addresses);

• § 1610.5 (Request for records section is revised to utilize OIP's template language);

• § 1610.6 (Records of other agencies section is deleted; the information is moved to another section and utilizes OIP's template language);

• § 1610.7 (Where to make request: form section is revised to utilize OIP's template language);

• § 1610.8 (Authority to determine section is revised to utilize OIP's template language);

• § 1610.9 (Responses: timing section is revised to utilize OIP's template language);

• § 1610.10 (Responses: form and content section is revised to utilize OIP's template language and as required by the Act);

• § 1610.11 (Appeals to the Legal Counsel from initial denials section is revised to utilize OIP's template language and as required by the Act);

• § 1610.13 (Maintenance of files section is revised to utilize OIP's template language);

• § 1610.15 (Schedule of fees and method of payment for services section is revised to utilize OIP's template and as required by the Act);

• § 1610.17 (Exemptions section is revised to utilize OIP's template language and as required by the Act);

• § 1610.19 (Predisclosure notification procedures for confidential commercial information section is revised to utilize OIP's template language); and

• § 1610.21 (Annual report section is revised to utilize OIP's template language and as required by the Act).

The Commission invites comments. At the conclusion of the comment period, the Commission will review the comments received, and, if appropriate, will revise the regulation to ensure it aligns with the Act.

In promulgating this interim final rule, the Commission has adhered to the regulatory philosophy and applicable principles set forth in Executive Order 13563, 3 CFR 215 (2011). The proposed interim final rule has been drafted and reviewed in accordance with Executive Order 12866, 3 CFR 638 (1993). The rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866.

The proposed rule contains no new information collection requirements subject to review by the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

The Commission certifies under 5 U.S.C. 605(b) that the proposed rule will not have a significant economic impact on a substantial number of small entities because the proposed revisions do not impose any burdens upon FOIA requesters, including those that might be small entities. Therefore, a regulatory flexibility analysis is not required by the Regulatory Flexibility Act.

The proposed rule will not result in the expenditure by State, local, or tribal governments in the aggregate, or by the private sector, of $100 million or more in any one year, and it will not significantly or uniquely affect small governments. Therefore, no actions are deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1501).

The proposed rule is not subject to the reporting requirement of 5 U.S.C. 801 because it does not substantially affect the rights or obligations of non-agency parties and therefore is not a “rule” as that term is used by the Congressional Review Act (Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1998).

Title I of the Employee Retirement Income Security Act of 1974 (ERISA) establishes minimum standards for the operation of private-sector employee benefit plans and includes fiduciary responsibility rules governing the conduct of plan fiduciaries. The Department's longstanding position is that the fiduciary act of managing plan assets which are shares of corporate stock includes decisions on the voting of proxies and other exercises of shareholder rights. To assist plan fiduciaries in understanding their obligations under ERISA, the Department issued Interpretive Bulletin 94-2 (IB 94-2) in 1994 and updated that guidance in 2008 in Interpretive Bulletin 2008-2 (IB 2008-2).1

IB 94-2 noted that the duty to vote proxies lies exclusively with the plan trustee unless “the power to manage, acquire or dispose of the relevant assets has been delegated by a named fiduciary to one or more investment managers” pursuant to section 403(a)(2) of ERISA. IB 94-2 also explained that when the authority to manage plan assets has been delegated to an investment manager, “no person other than the investment manager has authority to vote proxies appurtenant to such plan assets except to the extent that the named fiduciary has reserved to itself (or to another named fiduciary so authorized by the plan document) the right to direct a plan trustee regarding the voting of proxies.” In addition, if the plan document or the investment management agreement does not expressly preclude the investment manager from voting proxies, the investment manager has the exclusive responsibility for proxy voting. An investment manager is not relieved of its own fiduciary responsibilities by following directions of some other person regarding the voting of proxies, or by delegating such responsibility to another person. IB 94-2 pointed out that the maintenance of written statements of investment policy, including guidelines on voting proxies on securities held in plan investment portfolios, is consistent with Title I of ERISA and that compliance with such a policy would be required under ERISA to the extent that such compliance with respect to any given investment decision is consistent with the provisions of Title I and Title IV of ERISA.

IB 94-2 also recognized that fiduciaries may engage in other shareholder activities intended to monitor or influence corporate management where the responsible fiduciary concludes that there is a reasonable expectation that such monitoring or communication with management, by the plan alone or together with other shareholders, is likely to enhance the value of the plan's investment in the corporation, after taking into account the costs involved. The bulletin observed that active monitoring and communication may be carried out through a variety of methods including by means of correspondence and meetings with corporate management as well as by exercising the legal rights of a shareholder.

IB 94-2 reiterated the Department's view that ERISA does not permit fiduciaries to subordinate the economic interests of participants and beneficiaries to unrelated objectives in voting proxies or in exercising other shareholder rights, but pointed out that a reasonable expectation of enhancing the value of the plan's investment through shareholder activities may exist in various circumstances, for example, where plan investments in corporate stock are held as long-term investments or where a plan may not be able to easily dispose of such an investment. IB 94-2 explained that active monitoring and communication activities could concern such issues as the independence and expertise of candidates for the corporation's board of directors and assuring that the board has sufficient information to carry out its responsibility to monitor management. Other issues identified in the bulletin included such matters as consideration of the appropriateness of executive compensation, the corporation's policy regarding mergers and acquisitions, the extent of debt financing and capitalization, the nature of long-term business plans, the corporation's investment in training to develop its work force, other workplace practices and financial and non-financial measures of corporate performance.2

On October 17, 2008, the Department replaced IB 94-2 with Interpretive Bulletin 2008-2 codified at 29 CFR 2509.08-2.3 The Department's intent was to clarify and update the guidance in IB 94-2 and to reflect interpretive positions issued by the Department after 1994 on shareholder activism and socially-directed proxy voting initiatives. On the same date, the Department published Interpretive Bulletin 2008-1 (IB 2008-1) to update Interpretive Bulletin 94-1 (IB 94-1), which addressed issues regarding fiduciary consideration of investments and investment strategies that take into account environmental, social and governance (ESG) factors.

The Department believes that in the eight years since its publication, the changes made to IB 94-2 by IB 2008-2 have been misunderstood and may have worked to discourage ERISA plan fiduciaries who are responsible for the management of shares of corporate stock from voting proxies and engaging in other prudent exercises of shareholder rights.4 In particular, the Department is concerned that IB 2008-2 has been read by some stakeholders to articulate a general rule that broadly prohibits ERISA plans from exercising shareholder rights, including voting of proxies, unless the plan has performed a cost-benefit analysis and concluded in the case of each particular proxy vote or exercise of shareholder rights that the action is more likely than not to result in a quantifiable increase in the economic value of the plan's investment.

The essential point of IB 94-2, however, was to articulate a general principle that a fiduciary's obligation to manage plan assets prudently extends to proxy voting. As such, IB 94-2 properly read was meant to express the view that proxies should be voted as part of the process of managing the plan's investment in company stock unless a responsible plan fiduciary determined that the time and costs associated with voting proxies with respect to certain types of proposals or issuers may not be in the plan's best interest. IB 94-2 was also intended to make it clear that fiduciary duties associated with voting proxies encompass the monitoring of decisions made and actions taken with regard to proxy voting, and that it was appropriate for a plan fiduciary to incur reasonable expenses in fulfilling those fiduciary obligations. While there may be special circumstances that might warrant a discrete analysis of the cost of the shareholder activity versus the economic benefit associated with the outcome of the activity, the Department did not intend to imply that such an analysis should be conducted in most cases. In most cases, proxy voting and other shareholder engagement does not involve a significant expenditure of funds by individual plan investors because the activities are engaged in by institutional investment managers appointed as the responsible plan fiduciary pursuant to sections 402(c)(3), 403(a)(2) and 3(38) of ERISA. Those investment managers often engage consultants, including proxy advisory firms, in an attempt to further reduce the costs of researching proxy matters and exercising shareholder rights.5 Thus, such a conclusion ignores the fact that many proxy votes involve very little, if any, additional expense to the individual plan shareholders to arrive at a prudent result and that, depending on the particular resolution and the extent of the plan's holdings, not voting, in fact, may in effect count one way or another.

The pervasiveness of US publicly-traded stock in ERISA plan investment portfolios, both direct holdings and through pooled investment funds, including index funds, is another factor that contributes to the importance of proxy voting and shareholder engagement practices. If there is a problem identified with a portfolio company's management, selling the stock and finding a replacement investment may not be a prudent solution for a plan fiduciary. As Vanguard founder John Bogle put it in the context of index funds, “the only weapon [index funds] have, if we don't like the management, is to get a new management or to force the management to reform.” 6

The Department is also concerned that despite the guidance on ESG issues the Department recently provided in IB 2015-1, statements in IB 2008-2 may cause confusion as to whether or how a plan fiduciary may consider ESG issues in connection with proxy voting or undertaking other shareholder engagement activities. The Department has rejected a construction of ERISA that would render ERISA's tight limits on the use of plan assets illusory and that would permit plan fiduciaries to expend trust assets to promote myriad public policy preferences. Rather, plan fiduciaries may not increase expenses, sacrifice investment returns, or reduce the security of plan benefits in order to promote collateral goals. However, by focusing on a “cost-benefit analysis” demonstrating a “more likely than not” enhancement in the economic value of the investment, the Department believes that IB 2008-2 may be read as discouraging fiduciaries from recognizing the long-term financial benefits that, although difficult to quantify, can result from thoughtful shareholder engagement when voting proxies, establishing a proxy voting policy, or otherwise exercising rights as shareholders.

The existence of financial benefits associated with shareholder engagement is suggested by the fact that a growing number of institutional investors are now engaging companies on ESG issues. According to a 2014 survey by the US SIF Foundation, 202 institutional investors or money managers representing $1.72 trillion in US-domiciled assets filed or co-filed shareholder resolutions on ESG issues at publicly traded companies from 2012 through 2014.7 The members of the Investor Network on Climate Risk (INCR), a network of institutions representing more than $14 trillion in assets, engage with companies in their portfolios on climate and sustainability issues. Members include BlackRock, California Public Employees' Retirement System, Deutsche Asset & Wealth Management, Prudential Investment Management, State Street Global Advisors and TIAA Global Asset Management.8 Globally, over 1300 asset managers and asset owners have signed the Principles for Responsible Investment, the second principle of which states that the managers and owners will be active owners and incorporate ESG issues into ownership policies and practices.9 Companies are also being required to be more transparent in the way they address ESG issues. For example, in 2010, the Dodd-Frank Act required publicly traded companies to allow shareholders an advisory vote on executive pay plans at least once every three years.10 Similarly, in 2009 the SEC issued rules which required companies to disclose in proxy statements relating to the election of directors, among other things, their policy for consideration of diversity in the process by which candidates for director are considered for nomination by a company's nominating committee.11

Other market developments further substantiate the financial benefits from shareholder engagement. Companies themselves are seeking more engagement as a way of understanding and responding to their shareholders' views.12 There have also been market events that were catalysts for the growth of shareholder engagement. The financial crisis of 2008 exposed some of the pitfalls of shareholder inattention to corporate governance and highlighted the merits of shareholders taking a more engaged role with the companies.

This is not a trend unique to the United States. Other countries have recognized these developments and taken steps to provide guidance on proxy voting and shareholder engagement in the form of “stewardship codes.” The first stewardship code was published in 2010 by the UK's Financial Reporting Council, which traces its origins to principles published by the UK's Institutional Shareholders Committee in 2002 and later the International Corporate Governance Network Principles on Institutional Investor Responsibilities in 2007.13 Other such codes have followed, including in Canada, Italy, Japan, Singapore, South Africa, Switzerland, the Netherlands, and Malaysia.14

For all the above reasons, the Department is concerned that the changes to IB 94-2 in IB 2008-2 are out of step with important domestic and international trends in investment management and have the potential to dissuade ERISA fiduciaries from exercising shareholder rights, including the voting of proxies, in areas that are increasingly being recognized as important to long-term shareholder value. In fact, the Department believes the principles originally articulated in IB 94-2, with certain updates to reflect the trends on shareholder engagement discussed above, are a better expression of a fiduciary's obligations under sections 402(c)(3), 403(a) and 404(a)(1)(A) of ERISA on these issues. The Department therefore has decided to withdraw IB 2008-2 and replace it with Interpretive Bulletin 2016-1 which reinstates the language of IB 94-2 with minor updates.

The following Interpretive Bulletin deals solely with the applicability of the prudence and exclusive purpose requirements of ERISA as applied to fiduciary decisions with respect to voting of proxies on securities held in employee benefit plan investment portfolios, the maintenance of and compliance with statements of investment policy, including proxy voting policy, and the appropriateness under ERISA of shareholder engagement with corporate management by plan fiduciaries. The bulletin does not supersede the regulatory standard contained at 29 CFR 2550.404a-1, nor does it address any issues which may arise in connection with the prohibited transaction provisions under ERISA section 406 or the statutory exemptions under ERISA section 408 from those provisions. This Interpretative Bulletin is a restatement of IB 94-2 with certain updates to the examples of areas where monitoring or communication with management is likely to enhance the value of the plan's investment in the corporation.

For the reasons set forth in the preamble, the Department is amending part 2509 of title 29 of the Code of Federal Regulations as follows:

This is a procedural action to extend the deadline for the EPA to respond to a petition from the state of Delaware filed pursuant to CAA section 126(b). The EPA received the petition on November 10, 2016. The petition requests that the EPA make a finding under section 126(b) of the CAA that the Homer City Generating Station, located in Indiana County, Pennsylvania, is operating in a manner that emits air pollutants in violation of the provisions of section 110(a)(2)(D)(i)(I) of the CAA with respect to the 2008 and 2015 ozone NAAQS.

Section 126(b) of the CAA authorizes states to petition the EPA to find that a major source or group of stationary sources in upwind states emits or would emit any air pollutant in violation of the prohibition of CAA section 110(a)(2)(D)(i) 1 by contributing significantly to nonattainment or maintenance problems in downwind states. Section 110(a)(2)(D)(i)(I) of the CAA prohibits emissions of any air pollutant in amounts which will contribute significantly to nonattainment in, or interfere with maintenance by, any other state with respect to any NAAQS. The petition asserts that emissions from Homer City Generating Station's three electric generating units emit air pollutants in violation of CAA section 110(a)(2)(D)(i)(I) with respect to the 2008 8-hour ozone NAAQS, set at 0.075 parts per million (ppm), and the revised 2015 8-hour ozone NAAQS, set at 0.070 ppm.2

Pursuant to CAA section 126(b), the EPA must make the finding requested in the petition, or must deny the petition within 60 days of its receipt. Under CAA section 126(c), any existing sources for which the EPA makes the requested finding must cease operations within 3 months of the finding, except that the source may continue to operate if it complies with emission limitations and compliance schedules (containing increments of progress) that the EPA may provide to bring about compliance with the applicable requirements as expeditiously as practical but no later than 3 years from the date of the finding.

CAA section 126(b) further provides that the EPA must hold a public hearing on the petition. The EPA's action under section 126 is also subject to the procedural requirements of CAA section 307(d). See CAA section 307(d)(1)(N). One of these requirements is notice-and-comment rulemaking, under section 307(d)(3)-(6).

In addition, CAA section 307(d)(10) provides for a time extension, under certain circumstances, for a rulemaking subject to CAA section 307(d). Specifically, CAA section 307(d)(10) provides:

CAA section 307(d)(10) may be applied to section 126 rulemakings because the 60-day time limit under CAA section 126(b) necessarily limits the period for promulgation of a final rule after proposal to less than 6 months.

In accordance with CAA section 307(d)(10), the EPA is determining that the 60-day period afforded by CAA section 126(b) for responding to the petition from the state of Delaware is not adequate to allow the public and the agency the opportunity to carry out the purposes of CAA section 307(d). Specifically, the 60-day period is insufficient for the EPA to complete the necessary technical review, develop an adequate proposal, and allow time for notice and comment, including an opportunity for public hearing, on a proposed finding regarding whether the Homer City Generating Station identified in the CAA section 126 petition contributes significantly to nonattainment or interferes with maintenance of the 2008 ozone NAAQS or the 2015 ozone NAAQS in Delaware. Moreover, the 60-day period is insufficient for the EPA to review and develop response to any public comments on a proposed finding, or testimony supplied at a public hearing, and to develop and promulgate a final finding in response to the petition. The EPA is in the process of determining an appropriate schedule for action on the CAA section 126 petition. This schedule must afford the EPA adequate time to prepare a proposal that clearly elucidates the issues to facilitate public comment, and must provide adequate time for the public to comment and for the EPA to review and develop responses to those comments prior to issuing the final rule. As a result of this extension, the deadline for the EPA to act on the petition is July 9, 2017.

This document is a final agency action, but may not be subject to the notice-and-comment requirements of the APA, 5 U.S.C. 553(b). The EPA believes that, because of the limited time provided to make a determination, the deadline for action on the CAA section 126 petition should be extended. Congress may not have intended such a determination to be subject to notice-and-comment rulemaking. However, to the extent that this determination otherwise would require notice and opportunity for public comment, there is good cause within the meaning of 5 U.S.C. 553(b)(3)(B) not to apply those requirements here. Providing for notice and comment would be impracticable because of the limited time provided for making this determination, and would be contrary to the public interest because it would divert agency resources from the substantive review of the CAA section 126 petition.

This action is effective on December 29, 2016. Under the APA, 5 U.S.C. 553(d)(3), agency rulemaking may take effect before 30 days after the date of publication in the Federal Register if the agency has good cause to mandate an earlier effective date. This action—a deadline extension—must take effect immediately because its purpose is to extend by 6 months the deadline for action on the petition. As discussed earlier, the EPA intends to use the 6-month extension period to develop a proposal on the petition and provide time for public comment before issuing the final rule. It would not be possible for the EPA to complete the required notice and comment and public hearing process within the original 60-day period noted in the statute. These reasons support an immediate effective date.

This action is exempt from review by the Office of Management and Budget because it simply extends the date for the EPA to take action on a petition.

This action does not impose an information collection burden under the PRA. This good cause final action simply extends the date for the EPA to take action on a petition and does not impose any new obligations or enforceable duties on any state, local or tribal governments or the private sector. It does not contain any recordkeeping or reporting requirements.

This action is not subject to the RFA. The RFA applies only to rules subject to notice-and-comment rulemaking requirements under the APA, 5 U.S.C. 553, or any other statute. This rule is not subject to notice-and-comment requirements because the agency has invoked the APA “good cause” exemption under 5 U.S.C. 553(b).

This action does not contain any unfunded mandate of $100 million or more as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local or tribal governments or the private sector.

This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government.

This action does not have tribal implications, as specified in Executive Order 13175. This good cause final action simply extends the date for the EPA to take action on a petition. Thus, Executive Order 13175 does not apply to this rule.

The EPA interprets Executive Order 13045 as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of “covered regulatory action” in section 2-202 of the Executive Order. This action is not subject to Executive Order 13045 because it does not concern an environmental health risk or safety risk.

This action is not subject to Executive Order 13211, because it is not a significant regulatory action under Executive Order 12866.

This rulemaking does not involve technical standards.

The EPA believes that this action is not subject to Executive Order 12898 (59 FR 7629, February 16, 1994) because it does not establish an environmental health or safety standard. This good cause final action simply extends the date for the EPA to take action on a petition and does not have any impact on human health or the environment.

This action is subject to the CRA, and the EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. The CRA allows the issuing agency to make a rule effective sooner than otherwise provided by the CRA if the agency makes a good cause finding that notice-and-comment rulemaking procedures are impracticable, unnecessary or contrary to the public interest (5 U.S.C. 808(2)). The EPA has made a good cause finding for this rule as discussed in Section II.B of this document, including the basis for that finding.

The statutory authority for this action is provided by sections 110, 126 and 307 of the CAA as amended (42 U.S.C. 7410, 7426 and 7607).

Under section 307(b)(1) of the CAA, judicial review of this final rule is available only by the filing of a petition for review in the U.S. Court of Appeals for the appropriate circuit by February 27, 2017. Under section 307(b)(2) of the CAA, the requirements that are the subject of this final rule may not be challenged later in civil or criminal proceedings brought by us to enforce these requirements.

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

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

You may access a frequently updated electronic version of 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.

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-2016-0007 or EPA-HQ-OPP-2016-0008 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 February 27, 2017. 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-2016-0007 or EPA-HQ-OPP-2016-0008, 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.

In the Federal Register of April 25, 2016 (81 FR 24044) (FRL-9944-86), EPA issued a document pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the filing of a pesticide petition (IN-10846 for isobutyl acetate; IN-10852 for isobutyric acetate) by Technology Sciences Group Inc., (1150 18th Street NW., Suite 1000, Washington, DC 20036) on behalf of Jeneil Biosurfactant Company (400 N. Dekora Woods Blvd. Saukville, WI 53080). The petition requested that 40 CFR 180.910 be amended by establishing exemptions from the requirement of a tolerance for residues of isobutyl acetate (CAS Reg. No. 110-19-0) and isobutyric acid (CAS Reg. No. 79-31-2) when used as inert ingredients (solvent) in pesticide formulations applied to growing crops and to raw agricultural commodities after harvest. That document referenced the summaries of the petitions prepared by Technology Sciences Group Inc. on behalf of Jeneil Biosurfactant Company, the petitioner, which is available in the docket, http://www.regulations.gov. A comment was received on the notice of filing concerning petition #IN-10846. EPA's response to this comment is discussed in Unit V.B.

Inert ingredients are all ingredients that are not active ingredients as defined in 40 CFR 153.125 and include, but are not limited to, the following types of ingredients (except when they have a pesticidal efficacy of their own): Solvents such as alcohols and hydrocarbons; surfactants such as polyoxyethylene polymers and fatty acids; carriers such as clay and diatomaceous earth; thickeners such as carrageenan and modified cellulose; wetting, spreading, and dispersing agents; propellants in aerosol dispensers; microencapsulating agents; and emulsifiers. The term “inert” is not intended to imply nontoxicity; the ingredient may or may not be chemically active. Generally, EPA has exempted inert ingredients from the requirement of a tolerance based on the low toxicity of the individual inert ingredients.

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

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

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

EPA has evaluated the available toxicity data and considered their validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. Specific information on the studies received and the nature of the adverse effects caused by isobutyl acetate and isobutyric acid as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies are discussed in this unit.

Only acute toxicity data are available on isobutyric acid and no data are available on isobutyl acetate. However, upon ingestion, isobutyl acetate is rapidly and completely hydrolyzed to isobutanol and acetic acid. Isobutyric acid is a metabolic product of isobutanol.

Isobutanol is metabolized by alcohol dehydrogenase to form isobutyric acid via conversion to isobutyraldehyde. Therefore, toxicity data on isobutanol are considered suitable to assess repeated exposure to isobutyl acetate and isobutyric acid. Since acetic acid is currently exempted from tolerance under 40 CFR 180.910 without limitation, this risk assessment focuses on toxicity data available on isobutanol.

The acute oral and dermal toxicities are low for isobutyric acid. Isobutyric acid has an acute oral lethal dose (LD50) ≥ 2,230 milligram/kilogram (mg/kg) in rats and rabbits. The acute dermal LD50 = 475 mg/kg in rabbits. The acute inhalation LC50 > 9.59 milligram/liter (mg/L) in rats. It is corrosive to the eye and skin in rabbits. Isobutyric acid is not a dermal sensitizer in rabbits. Isobutanol has an acute oral LD50 ≥ 2,830 mg/kg in rats. The acute dermal acute LD50 ≥ 2,000 mg/kg in rabbits. The acute inhalation LC50 > 6,000 parts per million (ppm) (approximately equivalent to 6,000 mg/L) in rats. Isobutanol is severely irritating to the eye and minimally to moderately irritating to the skin in rabbits.

Based on the subchronic data available, isobutanol is not toxic up to the limit dose of 1,000 milligram/kilogram/day (mg/kg/day). In a 90-day oral toxicity study via gavage in rats, hypo-activity, ataxia and salivation were observed at 1,000 mg/kg/day of isobutanol. In another 90-day oral toxicity study with isobutanol via drinking water in rats, no adverse effects were observed at doses up to 16,000 ppm (approximately 1,450 mg/kg/day), the highest dose tested (HDT). The study conducted via drinking water in rats is considered more relevant to human exposure and therefore more reflective of potential human toxicity.

In developmental toxicity studies with isobutanol via inhalation in rats and rabbits, neither maternal nor developmental toxicity is seen at doses up to 10,000 mg/m3 (approximately 3,060 mg/kg/day), the HDT in both studies and above the limit dose of 1,000 mg/kg/day.

Similarly, no adverse effects are observed in a two-generation reproductive study with isobutanol via inhalation in rats at doses up to 2,500 ppm (approximately 2,326 mg/kg/day).

Carcinogenicity studies with isobutyl acetate, isobutyric acid or isobutanol are not available. However, a chronic toxicity study in rats treated with isobutantol in drinking water for 53-56 weeks did not show any evidence of toxicity or tumors at doses as high as 200 mg/kg/day. In addition, no toxicity is observed in other studies at doses below 1,450 mg/kg/day with isobutanol. Moreover, mutagenicity studies are negative with isobutanol and isobutyric acid. An Ames test, unscheduled DNA synthesis and mouse lymphoma assay are negative when tested with isobutyric acid. The Ames test, mouse lymphoma, Comet and micronucleus assays are negative when tested with isobutanol. Therefore, isobutyl acetate and isobutyric acid are not expected to be carcinogenic.

A neurotoxicity screening battery with isobutanol via the inhalation route of exposure in rats was available for review. Also, neurotoxicity endpoints were evaluated in an acute toxicity study in rats with isobutanol via the inhalation route of exposure. No adverse effects were observed in the functional observational battery, motor activity, schedule control operant behavior or neuropathology at doses up to 1,500 ppm (approximately 1,408 mg/kg/day) and 2,500 ppm (approximately 2,326 mg/kg/day) in rats in the neurotoxicity screening battery and acute toxicity studies, respectively. EPA concluded that isobutyl acetate and isobutyric acid are not expected to be neurotoxic.

Immunotoxicity studies with isobutyric acid and isobutanol are available for review. Mouse cell-mediated immune response is not modulated by isobutyric acid in a host-resistant assay using Listeria monocytogenes. Humoral immunity is unaffected in mice as measured by the antibody plaque-forming cell response to sheep erythrocytes. Also, a lymphocyte mitogenesis test with isobutanol showed mitogenic activity is not inhibited in stimulated B and T cells from mouse spleen. Therefore, isobutyl acetate and isobutyric acid are not expected to be immunotoxic.

Metabolism studies are not available for isobutyl acetate. Limited data are available on isobutyric acid and isobutanol. A metabolism study with a single dose of isobutyric acid via gavage in rats showed that it is rapidly metabolized and the majority eliminated as expired CO2. Less than 1.0% of the dose is found in feces and 3.21-4.61% in urine. A metabolism study with isobutanol via gavage in rabbits showed that it is rapidly metabolized. 0.5% is excreted in the urine or exhaled air. Identified metabolites are isobutyraldehyde, isobutyric acid, and isovaleric acid. There is no concern for the metabolites isobutyraldehyde and isovaleric acid as they will be conjungated and excreted.

The available toxicity studies indicate that isobutanol has very low toxicity. The lowest NOAEL (316 mg/kg/day) in the database occurred in a 90-day oral toxicity study with isobutanol via gavage in rats. Hypo-activity, ataxia and salivation were seen at 1,000 mg/kg/day. In a second study conducted for 90 days with isobutanol via drinking water in rats, the aforementioned effects weren't seen at doses as high 1,450 mg/kg/day. The drinking water study in rats represents a more realistic route for human exposure to isobutyric acid and isobutyl acetate, and is considered more reflective of potential toxicity. Therefore, since no signs of toxicity were observed at doses up to the limit dose in oral and inhalation toxicity studies, an endpoint of concern for risk assessment purposes was not identified. Since no endpoint of concern was identified for the acute and chronic dietary exposure assessment and short and intermediate dermal and inhalation exposure, a quantitative risk assessment for isobutyric acid and isobutyl acetate is not necessary.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to isobutyl acetate and isobutyric acid, EPA considered exposure under the proposed exemption from the requirement of a tolerance. EPA assessed dietary exposures from isobutyl acetate and isobutyric acid in food as follows:

Under this exemption from the requirement of a tolerance, residues of isobutyl acetate and isobutyric acid may be found on foods from crops that were treated with pesticide formulations containing isobutyl acetate and isobutyric acid. However, a quantitative dietary exposure assessment was not conducted since a toxicological endpoint for risk assessment was not identified.

2. Dietary exposure from drinking water. Since a hazard endpoint of concern was not identified for the acute and chronic dietary assessment, a quantitative dietary exposure risk assessment for drinking water was not conducted, although exposures may be expected from use on food crops.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., textiles (clothing and diapers), carpets, swimming pools, and hard surface disinfection on walls, floors, and tables).

Isobutyl acetate and isobutyric acid may be used in pesticide products and non-pesticide products that may be used in and around the home. Based on the discussion in Unit IV.B., a quantitative residential exposure assessment for isobutyl acetate and isobutyric acid was not conducted.

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

Based on the available data, isobutyl acetate and isobutyric acid do not have a toxic mechanism; therefore, section 408(b)(2)(D)(v) does not apply.

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

As part of its qualitative assessment, the Agency did not use safety factors for assessing risk, and no additional safety factor is needed for assessing risk to infants and children. Based on an assessment of isobutyl acetate and isobutyric acid, EPA has concluded that there are no toxicological endpoints of concern for the U.S. population, including infants and children.

Because no toxicological endpoints of concern were identified, EPA concludes that aggregate exposure to residues of isobutyl acetate and isobutyric acid will not pose a risk to the U.S. population, including infants and children, and that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to isobutyl acetate and isobutyric acid residues.

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.

A comment was received from a private citizen who was concerned about the safety and impact pesticides on food on human health. The Agency understands the commenter's concerns and recognizes that some individuals believe that no residue of pesticides should be allowed. However, under the existing legal framework provided by section 408 of the Federal Food, Drug and Cosmetic Act (FFDCA), EPA is authorized to establish pesticide tolerances or exemptions where persons seeking such tolerances or exemptions have demonstrated that the pesticide meets the safety standard imposed by the statute, which EPA has determined here.

Therefore, exemptions from the requirement of a tolerance are established under 40 CFR 180.910 for residues of isobutyl acetate (CAS Reg. No. 110-19-0) and isobutyric acid (CAS Reg. No. 79-31-2) when used as inert ingredients (solvent) in pesticide formulations applied to growing crops and raw agricultural commodities after harvest.

This action establishes tolerance exemptions 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 exemptions in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), do not apply.

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

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

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

Therefore, 40 CFR chapter I is amended as follows:

I. Background

In FR Doc 2016-26668 (81 FR 80170 through 80562), the final rule entitled, “Medicare Program; Revisions to Payment Policies under the Physician Fee Schedule and Other Revisions to Part B for CY 2017; Medicare Advantage Bid Pricing Data Release; Medicare Advantage and Part D Medical Loss Ratio Data Release; Medicare Advantage Provider Network Requirements; Expansion of Medicare Diabetes Prevention Program Model; Medicare Shared Savings Program Requirements” there were a number of technical and typographical errors that are identified and corrected in this correcting document. These corrections are effective as if they had been included in the document published November 15, 2016. Accordingly, the corrections are effective January 1, 2017.

On page 80252, in our discussion of certain primary care services, we made typographical errors and referenced the final HCPCS G-codes incorrectly.

On page 80268, we made a typographical error in the new locality number for Stockton-Lodi-CA.

On page 80330, due to a drafting error, we inadvertently stated that we did not receive any comments on our proposals for the Electroencephalogram (EEG) family of codes, CPT Codes 95812, 95813, and 95957.

On page 80540, we inadvertently included language in our discussion of ICRs regarding payment to organizations that provide Medicare Diabetes Prevention Program Services.

On page 80543, due to a drafting error, in our discussion of RVUs relative to 2016, we inadvertently used the result descriptors incorrectly.

On page 80543, due to typographical errors the title of Table 51 and the CY 2017 RVU Budget Neutrality Adjustment are incorrect.

Due to a data error, the incorrect CY 2017 PE RVUs are included in Addendum B for HCPCS codes G0422 and G0423. The corrected CY 2017 PE RVUs for these codes are reflected in the corrected Addendum B available on the CMS Web site at www.cms.gov//PhysicianFeeSched/.

Under 5 U.S.C. 553(b) of the Administrative Procedure Act (APA), the agency is required to publish a notice of the proposed rule in the Federal Register before the provisions of a rule take effect. Similarly, section 1871(b)(1) of the Act requires the Secretary to provide for notice of the proposed rule in the Federal Register and provide a period of not less than 60 days for public comment. In addition, section 553(d) of the APA and section 1871(e)(1)(B)(i) of the Act mandate a 30-day delay in effective date after issuance or publication of a rule. Sections 553(b)(B) and 553(d)(3) of the APA provide for exceptions from the APA notice and comment, and delay in effective date requirements; in cases in which these exceptions apply, sections 1871(b)(2)(C) and 1871(e)(1)(B)(ii) of the Act provide exceptions from the notice and 60-day comment period and delay in effective date requirements of the Act as well. Section 553(b)(B) of the APA and section 1871(b)(2)(C) of the Act authorize an agency to dispense with normal notice and comment rulemaking procedures for good cause if the agency makes a finding that the notice and comment process is impracticable, unnecessary, or contrary to the public interest; and includes a statement of the finding and the reasons for it in the rule. In addition, section 553(d)(3) of the APA and section 1871(e)(1)(B)(ii) allow the agency to avoid the 30-day delay in effective date where such delay is contrary to the public interest and the agency includes in the rule a statement of the finding and the reasons for it.

In our view, this correcting document does not constitute a rulemaking that would be subject to these requirements. This document merely corrects technical errors in the CY 2017 PFS final rule. The corrections contained in this document are consistent with, and do not make substantive changes to, the policies and payment methodologies that were proposed subject to notice and comment procedures and adopted in the CY 2017 PFS final rule. As a result, the corrections made through this correcting document are intended to resolve inadvertent errors so that the rule accurately reflects the policies adopted in the final rule.

Even if this were a rulemaking to which the notice and comment and delayed effective date requirements applied, we find that there is good cause to waive such requirements. Undertaking further notice and comment procedures to incorporate the corrections in this document into the CY 2017 PFS final rule or delaying the effective date of the corrections would be contrary to the public interest because it is in the public interest to ensure that the rule accurately reflects our policies as of the date they take effect. Further, such procedures would be unnecessary because we are not making any substantive revisions to the final rule, but rather, we are simply correcting the Federal Register document to reflect the policies that we previously proposed, received public comment on, and subsequently finalized in the final rule. For these reasons, we believe there is good cause to waive the requirements for notice and comment and delay in effective date.

In FR Doc. 2016-26668 of November 15, 2016 (81 FR 80170-80562), make the following corrections:

1. On page 80252,

a. First column; in the section heading, 5. Assessment and Care Planning for Patients with Cognitive Impairment (GPPP6); line 3, the code “(GPPP6)” is corrected to read “(G0505)”.

b. Third column; first partial paragraph, line 6, the codes “GPPP1, GPPP2, GPPP3, GPPPX).” are corrected to read “G0502, G0503, G0504, G0507).”.

c. Third column; first partial paragraph, line 12 and 13, the codes “GPPP1, GPPP2, GPPP3, and GPPPX” are corrected to read “G0502, G0503, G0504 and G0507”.

3. On page 80268, top third of the page; in Table 15, MSA-Based Fee Schedule Areas in California—Continued, the list entry:

4. On page 80330, second column, third full paragraph; lines 1 and 2 the sentence “We did not receive any comments on our proposals for this family of codes.” is corrected to read “We received comments on the clinical labor task “perform procedure” for CPT codes 95812 and 95813, but these comments did not address the information contained in the RUC's PE summary of recommendations, which served as the primary rationale for our proposal. Instead, the commenters stated that the clinical labor task is not temporally equivalent to the services performed by the physician.”

5. On page 80540, third column; first full paragraph,

a. Lines 2 through 4, the phrase “Security Act exempts the Center for Medicare and Medicaid Innovation (CMMI) model tests and expansion,” is corrected to read “Security Act exempts models tested and expanded under section 1115A of the Act,”.

b. Line 11, the phrase “evaluation of CMMI models or” is corrected to read “evaluation of models or”.

6. On page 80543,

a. Third column, first full paragraph, line 10, the phrase “an overall decrease” is corrected to read “an overall increase”.

b. Third column, first full paragraph, line 12, the phrase “neutrality adjustment that is positive.” is corrected to read “neutrality adjustment that is negative.”

c. Bottom third of the page in Table 51, Calculation of the Final CY 2017 Anesthesia Conversion Factor (CM Estimate);

(1) The parenthetical in the table heading “(CM Estimate)” is removed.

(2) The list entry:

The Treaty between the Government of the United States of America and the Government of Canada concerning Pacific Salmon was signed at Ottawa on January 28, 1985, and subsequently was given effect in the United States by the Pacific Salmon Treaty Act (Act) at 16 U.S.C. 3631-3644.

Under authority of the Act, Federal regulations at 50 CFR part 300, subpart F, provide a framework for the implementation of certain regulations of the Commission and inseason orders of the Commission's Fraser River Panel for U.S. sockeye and pink salmon fisheries in the Fraser River Panel Area.

The regulations close the U.S. portion of the Fraser River Panel Area to U.S. sockeye and pink salmon tribal and non-tribal commercial fishing unless opened by Panel orders that are given effect by inseason regulations published by NMFS. During the fishing season, NMFS may issue regulations that establish fishing times and areas consistent with the Commission agreements and inseason orders of the Panel. Such orders must be consistent with domestic legal obligations and are issued by the Regional Administrator, West Coast Region, NMFS. Official notification of these inseason actions is provided by two telephone hotline numbers described at 50 CFR 300.97(b)(1) and in 81 FR 26157 (May 2, 2016). The inseason orders are published in the Federal Register as soon as practicable after they are issued. Due to the frequency with which inseason orders are issued, publication of individual orders is impractical.

The following inseason orders were adopted by the Panel and issued for U.S. fisheries by NMFS during the 2016 fishing season. Each of the following inseason actions were effective upon announcement on telephone hotline numbers as specified at 50 CFR 300.97(b)(1) and in 81 FR 26157 (May 2, 2016); those dates and times are listed herein. The times listed are local times, and the areas designated are Puget Sound Management and Catch Reporting Areas as defined in the Washington State Administrative Code at Chapter 220-22.

Areas 4B, 5, and 6C: Open to drift gillnets 12 p.m. (noon), Saturday, July 23, 2016, to 12 p.m. (noon), Wednesday, July 27, 2016.

Areas 4B, 5, and 6C: Extend for drift gillnets from 12 p.m. (noon), Wednesday, July 27, 2016, to 12 p.m. (noon), Saturday, July 30, 2016.

Areas 4B, 5, and 6C: Extend for drift gillnets from 12 p.m. (noon), Saturday, July 30, 2016, to 12 p.m. (noon), Wednesday, August 3, 2016.

Areas 4B, 5, and 6C: Extend for drift gillnets from 12 p.m. (noon), Wednesday, August 3, 2016, to 12 p.m. (noon), Saturday, August 6, 2016.

Areas 4B, 5, 6, 6C, 7, and 7A, excluding the Apex: Relinquish regulatory control effective 11:59 p.m. (midnight), Saturday, September 3, 2016. The Apex is those waters north and west of the Area 7A “East Point Line,” defined as a line projected from the low water range marker in Boundary Bay on the U.S./Canada border through the east tip of Point Roberts, WA, to the East Point Light on Saturna Island in the Canadian Province of British Columbia.

The Assistant Administrator for Fisheries NOAA (AA), finds that good cause exists for the inseason orders to be issued without affording the public prior notice and opportunity for comment under 5 U.S.C. 553(b)(B) as such prior notice and opportunity for comments is impracticable and contrary to the public interest. Prior notice and opportunity for public comment is impracticable because NMFS has insufficient time to allow for prior notice and opportunity for public comment between the time the stock abundance information is available to determine how much fishing can be allowed and the time the fishery must open and close in order to harvest the appropriate amount of fish while they are available.

The AA also finds good cause to waive the 30-day delay in the effective date, required under 5 U.S.C. 553(d)(3), of the inseason orders. A delay in the effective date of the inseason orders would not allow fishers appropriately controlled access to the available fish at that time they are available.

This action is authorized by 50 CFR 300.97, and is exempt from review under Executive Order 12866.

Black sea bass is in the snapper-grouper fishery and is managed under the FMP. The FMP was prepared by the Council and is implemented through regulations at 50 CFR part 622 under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act).

On December 4, 2013, NMFS published a notice of intent to prepare a draft EIS for Regulatory Amendment 16 and requested public comment (78 FR 72968). On October 23, 2015, the notice of availability for the draft EIS was published and public comment was also requested (80 FR 64409). The notice of availability for the final EIS for Regulatory Amendment 16 published on July 1, 2016 (81 FR 43198). On August 11, 2016, NMFS published a proposed rule for Regulatory Amendment 16 and requested public comment (81 FR 53109). The proposed rule and Regulatory Amendment 16 outline the rationale for the actions contained in this final rule. A summary of the actions implemented by Regulatory Amendment 16 and this final rule is provided below.

This final rule implements modifications to the current black sea bass pot seasonal closure. This final rule also modifies the buoy line rope marking requirements for black sea bass pots.

As established through Regulatory Amendment 19 to the FMP, black sea bass pot gear is prohibited in the South Atlantic exclusive economic zone (EEZ) annually from November 1 through April 30 (78 FR 58249, September 23, 2013). This final rule retains the November 1 through April 30 prohibition on the use of black sea bass pots but modifies the boundaries of the prohibition. This rule revises the South Atlantic EEZ-wide seasonal closure to a closure with two temporal and spatial components. The first closure period is for the months of November and April and the second closure period is for the months of December through March, each year. The first closure period is illustrated by Figure 1 below. During the November and April seasonal prohibition, the eastern boundary of the sea bass pot closed area off North and South Carolina is closer to shore than during the months of December through March.

During the black sea bass pot seasonal prohibition from December through March, each year, the closure area is larger than during the seasonal prohibition during November and April, particularly off Georgia and Florida. Waters off the coast of Georgia and Florida represent the primary right whale calving grounds in the South Atlantic EEZ. The black sea bass pot seasonal closure for December through March is illustrated in Figure 2 below.

The alternatives considered in Regulatory Amendment 16 for the black sea bass pot seasonal prohibition were developed considering spatial, temporal, and environmental variables. Spatial variation in the distribution of right whales is influenced by environmental variables such as water temperature, depth, and distance to shore. The closed areas in this final rule incorporate these environmental variables and spatial distribution patterns to minimize the risk of interactions of NARWs with black sea bass pot gear.

During the months of November and April, the area closed through this rule prohibits black sea bass pots inshore of an area which represents 91 percent of historical right whale sightings off Florida and Georgia; and off North Carolina and South Carolina, the black sea bass pot prohibition would apply to Federal waters shallower than 25 meters (m) in depth. During December through March, the area closed through this final rule prohibits black sea bass pots shallower than 25 m in depth off Florida and Georgia; and from the Georgia/South Carolina border to Cape Hatteras, North Carolina, the prohibition applies to Federal waters that are shallower than 30 m in depth. The bathymetric area closed during December through March is based on right whale sightings by depth and captures 97 percent and 96 percent of right whale sightings off the North Carolina/South Carolina area, and Florida/Georgia area, respectively.

The reduction in the closure areas described in this final rule are expected to minimize adverse socioeconomic effects of the current November through April black sea bass pot prohibition by increasing the area available to fish using black sea bass pots. In addition, the changes are expected to increase the flexibility of black sea bass pot endorsement holders to fish with this gear while maintaining an appropriate level of protection for NARWs.

On December 1, 2016, NMFS completed a new ESA consultation and biological opinion on the South Atlantic snapper-grouper fishery. The biological opinion concluded that the continued authorization of the South Atlantic snapper-grouper fishery, including the black sea bass component, is not likely to jeopardize the continued existence of North Atlantic right whales, the only listed whale species in the South Atlantic region that may be adversely affected by the fishery.

This final rule also allows for vessel transit through the black sea bass pot closed areas, providing that the black sea bass pot gear is appropriately stowed on the vessel. Transit is defined as non-stop progression through the closed area; fishing gear appropriately stowed means all black sea bass pot gear must be out of the water and on board the deck of the vessel. All buoys must either be disconnected from the gear or stowed within the sea bass pot. The disconnected buoys may remain on deck.

Fish traps and pot buoy lines, including black sea bass pots, are currently required to have specific line marking requirements during certain times of the year and in the locations described in the Atlantic Large Whale Take Reduction Plan (ALWTRP)(see 50 CFR 229.32(b)). The ALWTRP includes at least three areas where black sea bass pots are regulated and fished. This includes the Offshore Trap/Pot Waters Area, Southern Nearshore Trap/Pot Waters Area, and the U.S. Southeast Restricted Area North.

Additionally, the FMP contains separate gear requirements, and Regulatory Amendment 16 modifies the current gear marking requirements under the FMP by requiring additional markings for black sea bass pot buoy lines. This final rule requires that an additional 12-inch (30.5 cm) wide purple band be added onto the buoy line at the end of, and directly adjacent to, each of the currently required 12-inch (30.5 cm) colored marks that are required through the ALWTRP, described in 50 CFR 229.32(b). Within the area of the Council's jurisdiction for managing black sea bass, the additional black sea bass gear marking requirements are required to be in place in Federal waters from September 1 through May 31 in the Offshore Trap/Pot Waters Area and the Southern Nearshore Trap/Pot Waters Area, and from November 15 through May 31 in the Southeast U.S. Restricted Area North. The Council's requirement that sea bass pot gear have additional gear-specific marking will help distinguish black sea bass pots from other fishing gear that could be encountered by whales.

A total of 13 comment submissions were received on the proposed rule from individuals, a Federal agency, a commercial fishing organization, and non-governmental organizations (NGOs). Eight comments were in favor of the preferred actions in Regulatory Amendment 16 and three comments were opposed to the use of black sea bass pots in general in the South Atlantic EEZ. Two comment submissions received from the Federal agency and the NGOs expressed concerns over the actions in Regulatory Amendment 16. Specific comments related to the actions in Regulatory Amendment 16 and the proposed rule, as well as NMFS' respective responses, are summarized below.

Comment 1: Black sea bass pot gear marking should be a year-round requirement for all black sea bass pot buoy lines rather than just a seasonal measure as required in Regulatory Amendment 16.

Response: There currently are gear marking requirements for black sea bass pots as required through the ALWTRP, and separate gear marking requirements as required through the FMP. This final rule requires buoy line marking for black sea bass pots in addition to those already required through the ALWTRP. These additional markings are required in areas and during times similar to the existing ALWTRP gear marking requirements. The additional buoy line markings are required from September 1 through May 31, in the ALWTRP Offshore Trap/Pot Waters Area and Southern Nearshore Trap/Pot Waters Area, and from November 15 through May 31, in the ALWTRP Southeast U.S. Restricted Area North. NMFS and the Council determined that the new requirement for black sea bass pot gear marking, together with existing requirements, provides a mechanism to adequately identify the black sea bass pot component of the snapper-grouper commercial sector, given the timing and location of right whale expected occurrence. In addition, black sea bass pot fishers have reported that they will likely leave the newly required gear markings on their buoy lines year-round since it would require additional effort for them to remove it for a limited season. Therefore, the Paperwork Reduction Act (PRA) burden estimates assume that the required gear markings would stay on the buoy lines as long as the marking is clearly visible as required by the rule (50 CFR 622.189(g)), and not be applied and removed from the buoy lines each season.

Comment 2: NMFS should monitor and enforce the requirement for additional black sea bass pot gear marking required in this final rule.

Response: NMFS agrees that monitoring and enforcement of fishing gear marking requirements increases the effectiveness of these measures and intends to do that for the specific measures in Regulatory Amendment 16 upon implementation of this final rule. NMFS's Office of Law Enforcement (NOAA/OLE) and the United States Coast Guard (USCG) have the authority and the responsibility to enforce regulations implementing FMPs. NOAA/OLE special agents and officers specialize in living marine resource violations and provide fisheries expertise and investigative support for the overall fisheries mission, while the USCG provides at-sea patrol services for the fisheries mission.

To increase the effectiveness of fishing regulations, NOAA supplements at-sea and dockside inspections of fishing vessels through Cooperative Enforcement Agreements and Joint Enforcement Agreements with most of the states in the South Atlantic region. These agreements can include granting authority to state officers to also enforce the laws for which NOAA/OLE has jurisdiction. Additionally, all of the states in the South Atlantic region have their own law enforcement officers that routinely patrol and enforce fisheries regulations in state waters.

Comment 3: Several commenters stated that NMFS neglected to consider whether gear restrictions more stringent than those required by ALWTRP are needed in an area with juveniles and calves. In particular, the commenters stated that line breaking strength of greater than 2,200 lb (998 kg) is risk prone to the whales, and vertical lines heavier than 1,700 lb (771 kg) should not be allowed. The commenters were disappointed that the Agency has proposed to re-open a closed area and yet apparently failed to address the need to reduce risk beyond the status quo in the ALWTRP. The commenters noted that a recent peer-reviewed paper by Knowlton et al. (2015), though largely referencing the entanglement of adults, indicates that line breaking strengths of less than 1,700 lb (771 kg) would reduce the likelihood of life-threatening entanglements, and they noted that adult right whales have been found dead, entangled in gear with unbroken 600 lb (272 kg) weak links.

Response: While the Council considered a measure in the amendment to require a breaking strength lower than that required under the ALWTRP, they did not choose that measure because they changed their preferred alternative during the development of the black sea bass pot seasonal closure to require fishers to travel further offshore to fish for black sea bass during November 1 through April 30, when the weather is likely to be more inclement (such as increased currents) than at other times of the year. The Council concluded that fishing in these areas during the winter would likely put greater stress on the fishing gear in the water, and a breaking strength that is lower than is currently required under the ALWTRP could increase the number of lost black sea bass pots. NMFS agrees that if fishermen used vertical lines with a breaking strength less than 1,700 lb (771 kg), the risk of life-threatening entanglements to right whales would be reduced from current levels, however, with the Council's choice of closures for the black sea bass pot sector, the risk of potential right whale entanglement with black sea bass pot gear is low (Farmer et al. 2016). The recently completed ESA biological opinion on this fishery addresses vertical line breaking strength and contains a conservation recommendation that promotes the use of ropes with breaking strengths equal to or less than 1,700 lb (771 kg) for the black sea bass pot sector (50 CFR 402.2). NMFS is currently evaluating the implementation of this recommendation.

Comment 4: Passive acoustic recording arrays have been deployed off Georgia, South Carolina, and southern North Carolina since 2015; however, data from those arrays have yet to be published in a scientific journal describing the frequency of call rates at different distances from shore. Data on right whale call rates from these arrays should be analyzed to assess the probabilities of right whales encountering black sea bass pot buoy lines seaward of the offshore of the closure boundaries in Regulatory Amendment 16.

Response: National Standard 2 of the Magnuson-Stevens Act requires that conservation and management measures shall be based upon the best scientific information available, and NMFS has determined that the actions in Amendment 16 and this final rule are based on the best scientific information available. Based on NMFS's review of whale sightings, the models used for this rulemaking have performed well in predicting right whale distribution, and NMFS disagrees that unpublished data from these acoustic arrays should be included as part of Regulatory Amendment 16.

Comment 5: One commenter agrees that the modified seasonal closures from November 1 through April 30 for the black sea bass pot component would substantially reduce the entanglement risk to right whales but suggests that the minimum distance from shore for the seaward boundaries of the black sea bass pot closure should be revised to extend to at least 30 nautical miles (nm) from shore between Cape Hatteras and the Florida-Georgia border and at least 20 nm from shore in Duval and St. Johns Counties in Florida.

Response: NMFS disagrees that the boundaries of the black sea bass pot closure should be revised from those being implemented in this final rule. During the months of November and April, the area closed through this rule prohibits black sea bass pots inshore of an area which represents 91 percent of historical right whale sightings off Florida and Georgia; and off North Carolina and South Carolina, the black sea bass pot prohibition applies to Federal waters shallower than 25 m in depth. During December through March, the area closed through this final rule prohibits black sea bass pots shallower than 25 m in depth off Florida and Georgia; and from the Georgia/South Carolina border to Cape Hatteras, North Carolina, the prohibition applies to Federal waters that are shallower than 30 m in depth. This bathymetric area is based on right whale sightings by depth and captures 97 percent and 96 percent of right whale sightings off the North Carolina/South Carolina area, and Florida/Georgia area, respectively.

Right whales are likely to be most abundant offshore of Duval and St. Johns Counties in Florida from December through March. In Regulatory Amendment 16, for December through March off Duval and St. Johns Counties, the distance of the black sea bass pot gear offshore boundary to the shoreline is greater than 20 nm from shore, except for an approximately 15 square nm area off the boundary that separates Duval and St. Johns Counties. NMFS has determined that changing the boundary for that 15 nm area, as the commenter requests, would not result in a significant change in the predicted relative risk to right whales from black sea bass pot gear.

The analysis used in Regulatory Amendment 16 estimated that the area prohibition for black sea bass pots chosen by the Council has a low relative risk of entanglement of whales in black sea bass pot lines when compared with the other areas considered, and NMFS has determined that the analysis is based on the best scientific information available.

Comment 6: The proposed depth thresholds for the offshore boundaries do not adequately capture all areas likely to be used by right whales during the peak months of right whale occurrence. The analysis used to evaluate the alternatives in Regulatory Amendment 16 is based almost entirely on right whale sightings from aerial surveys. Aerial surveys under-represent right whale occurrence and entanglement risks for areas farther offshore. Other analyses of sighting data (e.g., Knowlton et al. 2002, Schick et al. 2009) indicate that a large majority of sightings have occurred within approximately 10 or 15 nm of shore, but conclude that habitat extending 30 nm from shore should be considered important to migrating and calving whales off the southeastern United States.

Response: NMFS disagrees. In Regulatory Amendment 16, right whale occurrence was predicted from two spatial distribution models that were based on a robust data set: Survey data for Florida-South Carolina during the calving season from 2003-2004 to 2012-2013 (Gowan and Ortega-Ortiz 2014) and surveys off North Carolina from October 2005-April 2006, December 2006-April 2007, and February 2008-April 2008 (Farmer et al. 2016). These two models allowed for extrapolation of predicted right whale occurrence in areas that were not surveyed (i.e., the models controlled for bias created by shore-based search effort).

The commenter cited Knowlton et al. (2002) and Schick et al. (2009) to support extending the black sea bass pot closure 30 nm from shore. However, Knowlton et al. (2002) summarized sightings data in the mid-Atlantic, but did not correct those sightings for survey effort as was done in the models used in the development of Regulatory Amendment 16. Schick et al. (2009) modeled right whale spatial distribution in the mid-Atlantic, but the results have a high degree of uncertainty as the study only used data from two female right whales, one tagged in 1996 and the other tagged in 2000. NMFS has determined that the analysis in Regulatory Amendment 16 represents the best scientific information available.

Comment 7: Limited telemetry and recent acoustic monitoring suggest that waters beyond 15 or 20 nm from shore are used by right whales more frequently than aerial survey data indicate. For example, data on right whales tagged with telemetry devices to document northbound migration routes from the southeastern U.S. calving grounds (Andrews 2016, Slay et al. 2002) indicate that they regularly use waters out to 30 nm from shore and therefore are not confined to waters shallower than 25 or 30 m in depth.

Response: There are varying levels of error and uncertainty associated with the preliminary telemetry tracks gathered from the two studies referenced (Andrews 2016, Slay et al. 2002), and the data have not been processed completely to account for those errors. Andrews (2016) summarizes the results of a right whale tagging study and contains a map that illustrates the estimated tracks of right whales tagged during the study. Slay et al. (2002) describes the results of a January 1999 study in which a female right whale accompanied by her calf was tracked via radio off northeast Florida and southeast Georgia. The researchers used telemetry to follow the mother/calf pair for 140 hours. That report overlays the whales' track with that of sea surface temperature and the temperatures associated with the track are consistent with modeled right whale distribution in Gowan and Ortega-Ortiz (2014), which was the basis for the analysis contained in Regulatory Amendment 16. Since the study described in Slay et al. (2002) used telemetry data, NMFS believes that the results have a high degree of uncertainty. However, the spatial distribution information learned from the one right whale mother/calf pair in Slay et al. (2002) was adequately represented in the model used by Gowan and Ortega-Ortiz (2014) during the development of Regulatory Amendment 16 and this final rule.

Comment 8: A 2016 study by the U.S. Navy shows that right whale call rates detected by an acoustic monitoring array moored perpendicular to the coast off Cape Hatteras, North Carolina, are highest within 15 or 20 nm of shore, but significant numbers of right whale calls also occur between 20 and 40 nm offshore.

Response: The U.S. Navy buoys in the acoustic array appeared to be placed at approximately 5 nm increments from the shoreline (i.e., 5, 10, 15, 20, and 25 nm from the shoreline). The offshore boundary of the black sea bass pot closure area extends nearly 20 nm offshore off North Carolina. From December 2013 through March 2014, the study indicates that the majority of right whale calls were detected at buoys that were located between 10 and 15 nm from the Cape Hatteras, North Carolina, shoreline. Fewer calls were detected 20 nm from the shoreline (when compared to the calls detected at 10 and 15 nm) and even fewer were detected 25 nm from shore. From October 2014 through February 2015, the majority of right whale calls were detected at buoys 5 and 10 nm from the shoreline (the buoy 15 nm from shore was offline from December 2014 through February 2015). Fewer right whale calls were detected 20 and 25 nm from shore. This study did not correlate the number of calls to the number of whales nor did they specify the detection range of the acoustic buoys. The U.S. Navy buoys in the study did not extend out to 40 nm as the commenter suggests, and the buoys were not designed with the intent of detecting whale calls. Therefore, NMFS has determined that the best scientific information available on right whale spatial distribution was used in Regulatory Amendment 16, and serves as the basis for this final rule.

Comment 9: The black sea bass pot seasonal closures should be extended to the shoreline, and black sea bass pot fishing in state waters should be prohibited at the same times that Federal waters are closed. Similar regulations should be in place for fishing gear in both state and Federal waters.

Response: The Council does not manage black sea bass in state waters, because the Magnuson-Stevens Act gives the Council the authority to manage fisheries in the EEZ, off North Carolina, South Carolina, Georgia and Florida (16 U.S.C. 1852(a)(1)(C)). However, NMFS and the Council informed the states of North Carolina, South Carolina, Georgia and Florida of the measures proposed for black sea bass pots during the development and implementation of Regulatory Amendment 16, and NMFS intends to ask each of these states to issue regulations compatible with this final rule.

Comment 10: The prohibition on winter black sea bass pot fishing outside of the right whale critical habitat area should be ended and areas as shown in Alternative 2 of Action 1 (the previous designation of North Atlantic right whale critical habitat) should be closed to fishing with black sea bass pot gear.

Response: NMFS disagrees that the area shown in Alternative 2 of Action 1 to modify the annual November 1 through April 30 prohibition on the use of black sea bass pot gear in Regulatory Amendment 16 should be the only area closed to fishing with black sea bass pot gear. The area shown in Alternative 2 of Action 1 is based on right whale critical habitat that was implemented in 1994, and on January 26, 2016, NMFS issued a final rule that created an expansion of the right whale critical habitat area (81 FR 4838) that was effective February 26, 2016. This recent determination of critical habitat is based on an increased understanding of where North Atlantic right whales occur, or are most likely to occur, off the southeastern United States. The Council did not include an alternative to base the closed area on the revised right whale critical habitat because the Council voted for final approval of Regulatory Amendment 16 in December 2015, which was prior to the publication of the final rule for the North Atlantic right whale critical habitat area expansion.

In addition, the analysis in Regulatory Amendment 16 indicated that Alternative 2 in Action 1 would introduce the greatest amount of entanglement risk to large whales, relative to all alternatives, because predicted North Atlantic right whale presence is higher outside of the geographic boundaries of Alternative 2.

Comment 11: NMFS should not modify the current restrictions on black sea bass pots because this type of fishing gear captures large amounts of fish and reduces the availability of black sea bass to fishermen using hook-and-line gear.

Response: NMFS agrees that commercial fishermen can harvest more black sea bass using pot gear than hook-and-line gear. In addition, NMFS acknowledges that this final rule will likely increase the benefits to fishers using black sea bass pot gear and decrease the benefits to fishers using hook-and-line gear, as described in the Classification section of this final rule. However, NMFS estimates that revenue losses to each vessel using fishing gear other than black sea bass pots will be relatively small.

Though commercial harvest is greater using black seas bass pot gear, there are only 32 fishers with an endorsement who may harvest black sea bass using pots, and as implemented through Amendment 18A to the FMP, each endorsement holder is limited to a maximum of 35 pots, a commercial trip limit of 1,000 lb (454 kg) gutted weight, and a requirement that pots be brought back to shore after each trip (77 FR 32408, June 1, 2012). The Council determined that modifying the current closure under this final rule will reduce the adverse socioeconomic impacts and increase the flexibility of black sea bass pot endorsement holders to fish with this gear, while continuing to protect ESA-listed whales in the South Atlantic region.

The Regional Administrator, Southeast Region, NMFS, has determined that this final rule is consistent with Regulatory Amendment 16, the Magnuson-Stevens Act, and other applicable law.

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

In compliance with section 604 of the RFA, NMFS prepared a final regulatory flexibility analysis (FRFA) for this final rule. The FRFA incorporates the Initial Regulatory Flexibility Analysis (IRFA), a summary of the significant economic issues raised by public comments, NMFS's responses to those comments, and a summary of the analyses completed to support the action. The FRFA follows.

The preamble to the final rule provides the statement of the need for and objectives of this final rule. The Magnuson-Stevens Act provides the statutory basis for this final rule.

No duplicative, overlapping, or conflicting Federal rules have been identified. In addition, no new reporting or record-keeping requirements are introduced by this final rule. However, the final rule will require that for each black sea bass pot buoy line an additional 12-inch (30.5 cm) wide purple band be added at the end of, and directly adjacent to, each of the currently required 12-inch (30.5 cm) colored marks required under the ALWTRP discussed above. Similar to the current requirements under the ALWTRP, this marking requirement does not need an additional expertise on the part of fishermen. NMFS estimates that this requirement will cost each pot endorsement holder about an additional $5 annually if surveyor's tape is used for line marking, or about an additional $90 annually if paint is used instead. The estimated additional annual time burden associated with the marking requirement is up to approximately 3.5 hours annually.

No comments specific to the IRFA or on the economic impacts of the rule more generally were received from the public or from the Chief Counsel for the Advocacy of the Small Business Administration and, therefore, no public comments are addressed in this FRFA. No changes to the proposed rule were made in response to public comments. NMFS agrees that the Council's choice of preferred alternative will best achieve the Council's objectives for Regulatory Amendment 16 while minimizing, to the extent practicable, the adverse effects on fishers, support industries, and associated communities.

NMFS expects this final rule to directly affect federally permitted commercial fishermen fishing for black sea bass in the South Atlantic. For RFA purposes only, NMFS has established a small business size standard for businesses, including their affiliates, whose primary industry is commercial fishing (see 50 CFR 200.2). A business primarily engaged in commercial fishing (NAICS code 11411) is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including affiliates), and has combined annual receipts not in excess of $11 million for all its affiliated operations worldwide. The $11 million standard became effective on July 1, 2016, and is to be used in place of the U.S. Small Business Administration's (SBA) current standards of $20.5 million, $5.5 million, and $7.5 million for the finfish (NAICS 114111), shellfish (NAICS 114112), and other marine fishing (NAICS 114119) sectors of the U.S. commercial fishing industry in all NMFS rules subject to the RFA after July 1, 2016.

Pursuant to the RFA, and prior to July 1, 2016, an IRFA was developed for this regulatory action using SBA's size standards. NMFS has reviewed the analyses prepared for this regulatory action in light of the new size standard. All of the entities directly affected by this regulatory action are commercial fishing businesses and were considered small under the SBA's size standards, and they all will continue to be considered small under the new NMFS standard. Thus, NMFS has determined that the new size standard does not affect analyses prepared for this regulatory action.

As of December 31, 2014, there were 32 holders of the Federal black sea bass pot endorsement to the snapper-grouper commercial permit. Since that time one endorsement holder has dropped out of the black sea bass pot component of the commercial sector, but the current analysis uses 32 endorsement holders because historical records of these 32 endorsement holders were used in Regulatory Amendment 16. Using the records of 32 endorsement holders for determining the economic effects is not expected to inflate the analytical results because only an average of 31 vessels fished for black sea bass using pots.

From the 2000/2001 through 2013/2014 fishing years, these endorsement holders used an average of 31 vessels fishing for black sea bass using pots. These vessels generated total combined revenues (2014 dollars) of $732,717 from black sea bass, $228,468 from other species jointly landed with black sea bass, and $248,662 from all other species in trips where black sea bass was not caught. The average annual revenue per vessel from all species, including black sea bass, landed by these vessels was $38,715 (2014 dollars). During the same time period, an average of 215 vessels using gear other than sea bass pots landed at least 1 lb (0.45 kg) of black sea bass. These vessels generated dockside total combined revenues (2014 dollars) of $199,574 from black sea bass, $3.838 million from other species jointly landed with black sea bass, and $7.680 million from all other species in trips where black sea bass was not caught. The average annual revenue per vessel from all species, including black sea bass, landed by these vessels was $54,651 (2014 dollars). Vessels that caught and landed black sea bass may also operate in other fisheries, the revenues of which are not known and are not reflected in these totals. Based on revenue information, all commercial vessels directly affected by the final rule may be assumed to be small entities.

Because all entities expected to be directly affected by this final rule are assumed to be small entities, NMFS has determined that this final rule will affect a substantial number of small entities. However, the issue of disproportionate effects on small versus large entities does not arise in the present case.

This final rule modifies the November 1 through April 30 annual prohibition on the use of black sea bass pot gear in the South Atlantic EEZ by allowing black sea bass pot fishing at depths greater than approximately 25 m from November 1 through 30, and April 1 through 30, from approximately Daytona Beach, Florida, to the Georgia/South Carolina border and off North and South Carolina; at depths greater than approximately 25 m from December 1 through March 31, from approximately Cape Canaveral, Florida, to Savannah, Georgia; and, at depths greater than approximately 30 m from December 1 through March 31 off North and South Carolina. In addition, this final rule requires black sea bass pot endorsement holders to put three 12-inch (30.5 cm) purple markings on each sea bass pot buoy line adjacent to the already required color markings on these lines under the ALWTRP. The marks are commonly made with either paint or surveyor's tape. As described in the codified text to this final rule, other materials may also be used for marking the line.

The modification to the current prohibition on the use of black sea bass pot gear will have contrasting economic effects on the two major groups of participants in the commercial harvest of black sea bass. This action will benefit those using pots for harvesting black sea bass, and given that the commercial annual catch limit (ACL) is predicted to be fully harvested, benefits to users of other fishing gear, such as hook-and-line, will decrease. The combined dockside revenues (2014 dollars) for all sea bass pot gear vessels are estimated to increase annually between $113,964 and $185,068 based on 2000-2013 average black sea bass price, or between $163,606 and $260,355 based on 2011-2013 average black sea bass price. Two price levels are used to provide a limit on the range of revenue effects. The lower limit is based on the 2000-2013 average black sea bass price and the upper limit is based on the 2011-2013 average black sea bass price. In contrast, the combined dockside revenues (2014 dollars) for all non-black seas bass pot gear vessels are estimated to decrease annually between $68,323 and $141,527 based on 2000-2013 average black sea bass price, or between $116,650 and $241,631 based on 2011-2013 the average black sea bass price. The net revenue change for all vessels combined will be between $43,541 and $46,367 based on 2000-2013 average price for black sea bass, or between $43,889 and $46,553 based on 2010-2013 average price for black sea bass. Assuming that revenue increases for users of pot gear will be equally distributed among the 32 endorsement holders, revenues per pot endorsement holder will increase annually between $3,561 and $5,783, or between $5,113 and $8,136. However, revenue per vessel for the 215 users of non-pot gear will decrease between $318 and $658, or between $543 and $1,124. For vessels using black seas bass pot gear, the expected revenue increases will be approximately 9 to 21 percent of their average annual revenue of $38,715 per vessel. However, revenue losses to vessels using fishing gear other than black sea bass pots will be between 1 and 2 percent of their average annual revenue of $54,651 per vessel. Therefore, on a per vessel basis, the revenue gains to the black seas bass pot endorsement holders could potentially be substantial, whereas the revenue losses to the other fishing gear users will be relatively small.

The requirement for black sea bass pot endorsement holders to put three 12-inch (30.5 cm) purple markings on each black sea bass pot buoy line adjacent to the already required colors required under the ALWTRP will cost each endorsement holder about an additional $5 annually if surveyor's tape is used, or about an additional $90 annually if paint is used instead.

The following discussion describes the alternatives that were not selected as preferred by the Council. In this section, the term “overall revenues” refers to the sum of revenues from all vessels using black sea bass pots and revenues from all vessels using gear other than black sea bass pots for for harvesting black sea bass.

Twelve alternatives, including the preferred alternative as described above, were considered for modifying the November 1 through April 30 prohibition on the use of black sea bass pot gear. The first alternative, the no action alternative, would maintain the current economic benefits to all participants in the fishery as well as provide the least likelihood of right whales getting entangled with black sea bass pot lines. However, this alternative would not address the need to reduce the adverse socioeconomic effects resulting from the current prohibition on the use of black sea bass pot gear.

The second alternative would apply the black sea bass pot closure to the area previously designated as North Atlantic right whale critical habitat from November 15 through April 15. This alternative would provide slightly more increases in overall revenues to commercial vessels than the preferred alternative, but it would also pose the highest risk of right whale entanglement with black sea bass pot buoy lines.

The third alternative would apply the black sea bass pot closure from approximately Ponce Inlet, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 30. Relative to the preferred alternative, this alternative would result in higher overall revenue increases but would also decrease protection to right whales from getting entangled with pot buoy lines.

The fourth alternative would apply the black sea bass pot closure from approximately Cape Canaveral, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 30. Although this alternative would provide increased protection to right whales from entanglement with black sea bass pot buoy lines, it would result in smaller overall revenue increases than the preferred alternative.

The fifth alternative would apply the black sea bass pot closure from approximately Daytona Beach, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 30. Relative to the preferred alternative, this alternative would provide slightly more increases in overall revenues to commercial vessels but would provide less protection to right whales from entanglement with black sea bass pot buoy lines.

The sixth alternative would apply the black sea bass pot closure from approximately Sebastian Inlet, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 30. Although this alternative would provide the second greatest protection in comparison with the other alternatives in Regulatory Amendment 16 to right whales from entanglement with pot buoy lines, it would result in lower overall revenue increases than the preferred alternative.

The seventh alternative would apply the black sea bass pot closure from approximately the Altamaha River, Georgia, to Cape Hatteras, North Carolina, with the following sub-alternatives: Annually from November 1 through December 15 and March 15 through April 30; annually from November 1 through December 15 and March 15 through April 30 for the area off North Carolina and South Carolina, and from November 15 through April 15 for the area off Georgia and Florida; and, annually from February 15 through April 30 for the area off North Carolina and South Carolina, and from November 15 through April 15 for the area off Georgia and Florida. Relative to the preferred alternative, this alternative and its sub-alternatives would result in relatively higher overall revenue increases but would provide much reduced protection to right whales from entanglement with sea bass pot buoy lines.

The eighth alternative would apply the black sea bass pot closure from approximately Daytona Beach, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 15; or annually from November 1 through December 15 and February 15 through April 30 for the area off North Carolina and South Carolina, and from November 15 through April 15 for the area off Georgia and Florida. Relative to the preferred alternative, this alternative and its sub-alternatives would result in higher overall revenue increases but would result in a much reduced protection to right whales from entanglement with pot buoy lines.

The ninth alternative would apply the black sea bass pot closure from approximately Daytona Beach, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 15; or annually from November 1 through December 15 and February 15 through April 30 for the area off North Carolina and South Carolina, and from November 15 through April 15 for the area off Georgia and Florida. Relative to the preferred alternative, this alternative and its sub-alternatives would result in higher overall revenue increases but would result in much reduced protection to right whales from entanglement with pot buoy lines.

The tenth alternative would apply the black sea bass pot closure from approximately the Georgia/South Carolina border, to Cape Hatteras, North Carolina, annually from November 1 through December 15, with the following provision: From February 15 through April 30, the black sea bass pot closure applies to certain inshore waters from approximately the Georgia/South Carolina border, to Cape Hatteras, North Carolina; from December 16 through February 14, there would be no closure off of the Carolinas; from November 15 through April 15, the black sea bass pot closure applies to certain inshore waters from approximately the Georgia/South Carolina border, to approximately Daytona Beach, Florida. Relative to the preferred alternative, this alternative would result in higher overall revenue increases but would result in much reduced protection to right whales from entanglement with pot buoy lines.

The eleventh alternative would apply the black sea bass pot closure from approximately Cape Canaveral, Florida, to Cape Hatteras, North Carolina, annually from November 1 through April 30. Relative to the preferred alternative, this alternative would result in higher overall revenue increases but would result in slightly reduced protection to right whales from entanglement with black sea bass pot buoy lines.

Four alternatives, including the preferred alternative, were considered in addition to the existing ALWTRP buoy line/weak link gear requirements and buoy line rope marking for black sea bass pots in the South Atlantic. The first alternative, the no action alternative, would not impose any additional cost on fishermen when fishing for black sea bass using pots but it would not meet the need for the action. The second alternative, with two sub-alternatives, would impose requirements in addition to those required under the current ALWTRP for black sea bass pot buoy lines from November 1 through April 30 in Federal waters in the South Atlantic. The first sub-alternative would require that the breaking strength for buoy lines not exceed 2,200 lb (997 kg) and the second sub-alternative would require that the breaking strength for buoy lines not exceed 1,200 lb (544 kg). The first sub-alternative is what is currently required under the ALWTRP in the Southeast U.S. Restricted Area North and would affect only about 17 pot endorsement holders in North Carolina. The estimated cost to each of these 17 fishermen is a maximum of $716. The second sub-alternative would impose the same cost per fisherman of $716 but would affect all 32 pot endorsement holders. The third alternative would require that the breaking strength of the weak links of the buoy lines must not exceed 400 lb (181 kg) for black sea bass pots in the South Atlantic EEZ. This alternative is a decrease from the current requirement of 600 lb (272 kg) breaking strength of the weak links under the ALWTRP, and is estimated to cost each of the 32 pot endorsement holders $65. Relative to the preferred alternative, all these alternatives, except the no action alternative, would impose higher costs upon fishermen using black sea bass pots.

This final rule contains a revised collection-of-information requirements subject to the PRA, which has been approved by OMB under control number 0648-0358. NMFS estimates the public reporting burden for the sea bass pot gear marking will result in an additional annual cost of up to $90 per sea bass pot endorsement holder and require up to an additional 3.5 hours per response per year. Based upon feedback from fishermen, the cost and time burden for the marking requirement may be slightly lower in subsequent years depending on the marking method used. However, NMFS estimates the requirement to endorsement holders will result in the same for cost and time burden for each subsequent year, because different materials used to mark sea bass pot gear are available and the longevity of the markings vary depending on factors such as the length of the fishing season and how often the gear is used. This estimate of the public reporting burden includes the time for reviewing instructions, gathering and maintaining the data needed, and completing and reviewing the collection-of-information.

Notwithstanding any other provision of the law, no person is required to respond to, nor will any person be subject to a penalty for failure to comply with, a collection-of-information subject to the requirements of the PRA, unless that collection-of-information displays a currently valid OMB control number. All currently approved NOAA collections-of-information may be viewed at http://www.cio.noaa.gov/services_programs/prasubs.html.

Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as small entity compliance guides. As part of the rulemaking process, NMFS prepared a fishery bulletin, which also serves as a small entity compliance guide. The fishery bulletin will be sent to all interested parties.

There are provisions in this final rule that are exempt from the requirement to delay the effectiveness of a final rule by 30 days after publication in the Federal Register, under 5 U.S.C. 553(d)(3). Specifically, NMFS finds good cause under 5 U.S.C. 553(d)(3) to waive the delay in the effective date for the revised time and area closures specific to the use of black sea bass pot gear in the South Atlantic EEZ set forth in § 622.183(b)(6), since these measures increase the allowable area and time available to this fishing gear type for the regulated community during the fishing year. Delaying implementation of these measures for black sea bass could result in snapper-grouper fishermen not having the opportunity to achieve optimum yield from this stock, because the black sea bass pot component of the commercial sector would have less time available during the year to harvest the ACL before the fishing year's end, thereby undermining the intent of the rule. Additionally, a delay in implementation for these measures would not allow fishers using black sea bass pot gear to begin fishing with that gear as soon as possible, which would therefore minimize the potential socioeconomic benefits of this final rule and be contrary to the purpose of Regulatory Amendment 16. Thus, not waiving the 30-day delay of effectiveness for these black sea bass pot gear closure provisions is unnecessary and contrary to the public interest, as a delay in implementation may negatively impact black sea bass pot fishers and be inconsistent with the purpose of this final rule with respect to reducing the socioeconomic impacts of the current closure. Therefore, a delay in effectiveness would diminish the social and economic benefits for snapper-grouper fishermen this final rule provides, which is part of the purpose of the rule. Thus, the measures applicable to the black sea bass pot gear area and seasonal closure in this final rule are effective upon publication.

Regulations implemented under the authority of the Atlantic Tunas Convention Act (ATCA; 16 U.S.C. 971 et seq.) and the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act; 16 U.S.C. 1801 et seq.) governing the harvest of BFT by persons and vessels subject to U.S. jurisdiction are found at 50 CFR part 635. Section 635.27 subdivides the U.S. BFT quota recommended by the International Commission for the Conservation of Atlantic Tunas (ICCAT) and implemented by NMFS among the various domestic fishing categories per the allocations established in the 2006 Consolidated Atlantic Highly Migratory Species Fishery Management Plan (2006 Consolidated HMS FMP) (71 FR 58058, October 2, 2006), as amended by Amendment 7 to the 2006 Consolidated HMS FMP (Amendment 7) (79 FR 71510, December 2, 2014), and in accordance with implementing regulations. The current baseline U.S. BFT quota and subquotas were established and analyzed in the BFT quota final rule (80 FR 52198, August 28, 2015). NMFS is required under ATCA and the Magnuson-Stevens Act to provide U.S. fishing vessels with a reasonable opportunity to harvest the ICCAT-recommended quota.

Background information about the need for additional flexibility within the IBQ Program for distribution of BFT quota transferred to the Longline category inseason was provided in the preamble to the proposed rule (81 FR 65988, September 26, 2016) and most of that information is not repeated here.

Vessels fishing with pelagic longline gear, which may only catch BFT incidentally while fishing for target species (primarily swordfish and yellowfin tuna), hold limited access Atlantic Tunas Longline permits and utilize Longline category BFT quota. Through Amendment 7, NMFS established the IBQ Program, a catch share program that identified 136 permit holders as IBQ share recipients based on specified criteria, including historical target species landings and the bluefin catch-to-target species ratios from 2006 through 2012. NMFS currently distributes and manages the Longline category BFT quota via the IBQ Program.

The specific objectives of the IBQ Program are to:

1. Limit the amount of BFT landings and dead discards in the pelagic longline fishery;

2. Provide strong incentives for the vessel owner and operator to avoid BFT interactions, and thus reduce bluefin dead discards;

3. Provide flexibility in the quota system to enable pelagic longline vessels to obtain BFT quota from other vessels with available individual quota in order to enable full accounting for BFT landings and dead discards, and minimize constraints on fishing for target species;

4. Balance the objective of limiting bluefin landings and dead discards with the objective of optimizing fishing opportunities and maintaining profitability; and

5. Balance the above objectives with potential impacts on the directed permit categories that target BFT, and the broader objectives of the 2006 Consolidated HMS FMP and the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act).

IBQ share recipients receive an annual allocation of the Longline category quota based on the percentage share they received through Amendment 7 but only if their permit is associated with a vessel in the subject year (i.e., only “qualified IBQ share recipients” receive annual allocations). Permit holders that were not selected to receive IBQ shares through Amendment 7 may still fish, but they are required to lease quota through the IBQ electronic system. Every vessel must have a minimum amount of quota allocation to fish (e.g., 0.25 metric tons (mt) whole weight (ww) (551 lb ww) for a trip in the Gulf of Mexico and 0.125 mt ww (276 lb ww) for a trip in the Atlantic), whether obtained through shares or by leasing, and every vessel must individually account for its BFT landings and dead discards through the IBQ electronic system.

In July 2015 and January 2016, NMFS transferred quota inseason from the Reserve category to the Longline category (80 FR 45098, July 29, 2015; 81 FR 19, January 4, 2016). In these inseason actions, NMFS distributed the transferred quota in equal amounts to 136 qualified IBQ share recipients. During 2015, 36 of these 136 qualified IBQ share recipients had no pelagic longline fishing activity (i.e., they took no fishing trips with pelagic longline gear). Furthermore, 31 of the 36 qualified IBQ share recipients that did not fish also did not lease IBQ to others (i.e., 31 neither fished nor leased and 5 did not fish but leased out their IBQ allocations). As a result, those 31 IBQ allocations went unused for the year and expired at year's end.

NMFS received requests, among other suggestions about the IBQ Program and management of the pelagic longline fishery, that when quota is transferred inseason to the Longline category, NMFS distribute it only to those vessels that are currently fishing (whether associated with IBQ shares or not) to optimize fishing opportunity and account for dead discards, rather than distributing it equally to all IBQ share recipients, some of whom currently neither fish with pelagic longline gear nor lease quota to other active Longline fishery participants. The proposed rule considered and analyzed that approach and invited public comment.

This final rule modifies the regulations to specify that distribution of quota transferred to the Longline category inseason (i.e., quota beyond the baseline Longline category quota that is distributed to qualified IBQ share recipients according to the three shareholder percentages implemented through Amendment 7) may be either to all qualified IBQ share recipients or only to permitted Atlantic Tunas Longline vessels with recent fishing activity whether they are associated with IBQ shares or not. NMFS will review information from logbook, vessel monitoring system (VMS), or electronic monitoring data to determine whether any fishing activity has occurred over the course of the subject and previous year thus indicating that there is “recent fishing activity,” as discussed in more detail below. For example, for inseason transfers in 2017, NMFS will examine fishing activity data for 2016 and 2017. Providing flexibility in the quota system and maintaining flexibility of the regulations to account for the highly variable nature of the BFT interactions in the pelagic longline fishery was an objective of Amendment 7 (See, e.g., Amendment text at 79 FR 71510 and 71559), and this adjustment to the regulations will further that objective.

In deciding whether to transfer additional quota to the Longline category inseason from the Reserve category, NMFS would first consider the existing 14 regulatory determination criteria for inseason or annual adjustments at 50 CFR 635.27(a)(8), including the need to “optimize fishing opportunity.”

Next, if NMFS decides to transfer quota to the Longline category inseason, NMFS will then decide whether to distribute that quota to all qualified IBQ share recipients or only to permitted Atlantic Tunas Longline vessels with recent fishing activity whether or not the vessel is associated with IBQ shares. This decision will be based on information for the subject year and previous year, including the number of BFT landings and dead discards, the number of IBQ lease transactions, the average amount of IBQ leased, the average amount of quota debt, the annual amount of IBQ allocation, any previous inseason allocations of IBQ, the amount of BFT quota in the Reserve category, the percentage of BFT quota harvested by the other quota categories, the remaining number of days in the year, the number of active vessels fishing not associated with IBQ share, and the number of vessels that have incurred quota debt or that have low levels of IBQ allocation. NMFS will determine which approach will best meet the specific objectives of the IBQ Program as stated in Amendment 7, including the objective of providing “flexibility in the quota system to enable pelagic longline vessels to obtain BFT quota from other vessels with available individual quota in order to enable full accounting for BFT landings and dead discards, and minimize constraints on fishing for target species.” For example, in years where leasing by IBQ share recipients is not occurring as anticipated by Amendment 7, distribution to only active vessels might be appropriate to encourage leasing at levels that ensure appropriate functioning of the IBQ system in future years. In years where the leasing program is functioning well and leasing is occurring as needed and as anticipated by Amendment 7, distribution may be to all of the qualified IBQ share recipients.

If NMFS distributes the inseason quota to all qualified IBQ share recipients, those qualified IBQ share recipients will receive equal amounts of the quota transferred.

If NMFS distributes inseason quota only to those vessels with recent fishing activity, vessels with “recent fishing activity” in the pelagic longline fishery will be based upon available information such as logbook, VMS, dealer, or electronic monitoring data for the subject and previous year. Any vessel activity in the pelagic longline fishery during this date range will be sufficient to qualify as “recent fishing activity.” The specific data analyzed for this date range in a given inseason action will be those available when the inseason transfer occurs, and will depend on which complete data are available at that time. For example, logbook data for a particular year are typically not available for use until several months into the following year due to the process of data entry and quality control, as well as late reporting. Therefore, early in a year, NMFS may determine vessel activity for the previous and subject year using VMS data, whereas later in the year, it might use both logbook and VMS data.

Whether NMFS distributes quota to all qualified IBQ recipients or to only those permitted vessels with recent fishing activity, quota transferred inseason will be distributed equally to the vessel accounts associated with the relevant vessels via the electronic IBQ system. In either case, when a qualified IBQ share recipient receives inseason quota, the quota will be designated as either Gulf of Mexico (GOM) IBQ, Atlantic (ATL) IBQ, or both GOM and ATL IBQ, according to the share recipient's regional designations. For vessels with recent fishing activity that are not qualified IBQ share recipients, NMFS will assign the distributed quota a regional designation based on where the majority of the vessel's “recent fishing activity” occurred for the relevant period analyzed.

NMFS received five written comments on the proposed rule during the comment period, three of which expressed support for the rule as proposed, particularly the flexibility in distribution of inseason BFT quota and efficient use of quota through inseason distribution to vessels with recent fishing activity, including newly-permitted vessels. Two written comments expressed qualified support for the proposed flexibility but suggested modified approaches to quota disbursement. All written comments can be found at http://www.regulations.gov/. The comments are summarized below by topic together with NMFS' responses.

Comment 1: All comments supported the objective of, and rationale for, the proposed regulatory changes to the IBQ Program. Specifically, comments supported the objective of regulations that would allow NMFS to optimize the distributions of inseason Atlantic BFT quota transfers to the Longline category by distributing inseason BFT quota either to all qualified IBQ share recipients or only to those permitted Atlantic Tunas Longline vessels with recent fishing activity, whether or not they are associated with IBQ shares. Comments supported the underlying rationale of the proposed measure, which they expressed as providing reasonable fishing opportunities for pelagic longline vessels in the context of the constraints of the IBQ Program. Some commenters specifically supported the concept of distributing inseason quota only to active vessels in order to increase efficiency of quota use among vessels, allow the distribution of quota to new participants in the fishery, and enable the potential for larger amounts of quota for each permit holder. One comment noted that the proposed regulations contribute to balancing the objective of optimizing fishing opportunity and maintaining profitability with the objective of limiting BFT landings and dead discards.

Response: NMFS agrees that the regulatory change to the IBQ Program will facilitate accounting for BFT bycatch by permitted Atlantic Tunas Longline vessels actively participating in the HMS pelagic longline fishery and support optimizing the distribution of quota among vessels. When transferring quota from the Reserve category to the Longline category inseason, NMFS will consider specific factors in the fishery and determine whether distribution of inseason quota (in the Longline category) to all qualified IBQ share recipients or only to those permitted Atlantic Tunas Longline vessels with recent fishing activity will best support the objectives of the FMP. Distribution of inseason quota only to active vessels (if the total number of active vessels is a smaller number of vessels than all qualified vessels) may result in a larger amount of quota for each recipient vessel. A larger inseason distribution would help these active vessels to remain fishing longer under fewer quota constraints and would reduce the transaction costs associated with finding additional quota through the leasing program in years where leased quota is not readily available. NMFS agrees that the regulation will be consistent with the objectives of the IBQ Program, which include the objective: “Balance the objective of limiting BFT landings and dead discards with the objective of optimizing fishing opportunities and maintaining profitability”.

Comment 2: Three comments further supported the specifics of the proposed regulatory changes, including the data and timeframe that will be analyzed to determine whether “recent fishing activity” has occurred and equal distribution of inseason BFT quota among the recipients.

One commenter was opposed to the aspect of the proposed rule that considers a vessel to be “active” at any level of activity, without any threshold amount of fishing activity specified. The commenter was concerned that a vessel might “game the system” and deploy a single longline set on a single trip, with the goal of establishing a minimal level of fishing activity that would subsequently enable the vessel to be a recipient of an inseason distribution of BFT quota. The commenter suggested a meaningful increase in the number of pelagic longline sets required, and suggested that the amount of quota distributed to each vessel should vary depending upon the amount of pelagic longline sets completed. For example, if the vessel completed 1 to 25 sets during the previous year, they would be distributed a 0.25 share of BFT quota, and if the vessel completed 26 to 65 sets during the previous year, they would be distributed a 0.50 share of BFT quota, and so on. The commenter also suggested that inactive IBQ share recipients that have leased the full amount of their allocation to other Atlantic Tunas Longline vessels should receive inseason quota.

Response: NMFS proposed a simple method of defining what an active vessel is and distributing inseason quota equally among active vessels because inseason distributions of quota are likely to be relatively small amounts of quota compared to annual allocations of IBQ to share recipients. The use of formulas such as that proposed by the commenter to distribute quota may result in amounts distributed that are less than the minimum share amount required to fish. Distributing such small amounts of quota to vessels inseason might have little beneficial impact on fishing operations and could render the transfer largely meaningless for many vessels. With respect to setting a threshold number of pelagic longline sets as a criterion for receiving inseason allocation, all vessels fishing with pelagic longline gear must possess the minimum amount of IBQ (0.25 mt ww (551 lb ww) in the Gulf of Mexico and 0.125 mt ww (276 lb ww) in the Atlantic) before they can fish, and this requirement applies regardless of the level of fishing activity. Although it is possible that a vessel could conduct a single longline set with the intention of becoming eligible for a potential small future inseason quota distribution, it is likely that there would be few instances of such behavior because the potential costs and uncertainty of any benefit associated with such behavior should serve as adequate disincentive for “gaming the system.” Furthermore, the possibility that active vessels may directly receive quota from the Agency when the leasing system is not functioning effectively, may encourage otherwise-inactive vessel owners to more seriously consider leasing out their quota earlier in the season through the IBQ system, rather than waiting to see if leasing prices increase later in the season. Even if limited instances of such activity occurred, NMFS does not believe that such action would undercut the effectiveness of the regulatory change, which is largely aimed at limiting the amount of quota that could be distributed to vessels that have no fishing activity whatsoever.

The commenter also suggests that the amount of quota distributed inseason should be based on the level of vessel activity, suggesting that the amount of quota distributed to each vessel should vary depending upon the amount of pelagic longline sets completed. At the beginning of the year, IBQ share recipients are allocated different amounts of annual IBQ, based upon one of the three defined share percentages associated with the Atlantic Tunas Longline permit, which was based on a formula that considered many factors through the Amendment 7 process, including indicators of vessel activity. NMFS determined that additional distributions of quota inseason should be in equal amounts largely for simplicity of administration and given the small amounts of quota involved. An inseason quota distribution that is based upon a formula would be more complex to implement than an equal distribution and could diminish the benefits if implementation of the quota transfer and distribution took a prolonged amount of time. Therefore, NMFS finalizes as proposed the provision that will distribute inseason quota equally among selected recipients.

Finally, the commenter suggested that inactive IBQ share recipients that have leased the full amount of their allocation to other Atlantic Tunas Longline vessels should receive inseason quota distributions. Under the conditions at this time, the agency prefers its simpler proposed approach for distributing the small amounts of quota that typically are transferred inseason. By distributing the quota transferred inseason equally to active vessels inseason additional trips may be possible in years that leasing is not occurring as anticipated by Amendment 7. NMFS notes, however, that it will further consider this suggested approach as an incentive for those who fully participate in the leasing program. This could be included in the comprehensive three-year review of the IBQ Program that is required by the Magnuson-Stevens Act and the 2006 Consolidated HMS FMP and that NMFS plans to initiate in 2017.

Comment 3: One commenter sought changes to other aspects of the IBQ Program regulations, such as modifying the IBQ rules to allow the carryover of unused quota from one year to the next, and asked that NMFS consider changes to annual allocation of IBQ (i.e., distribution of the baseline Longline category quota).

Response: The suggested changes to the regulations were not among the specific management measures considered by the proposed rule and are beyond the scope of this rulemaking. The scope of this rulemaking addressed only inseason transfer criteria regulations; provisions regarding carry-forward and annual allocation of IBQ were established in Amendment 7 and no changes to those provisions were considered in this action. NMFS may consider changes to these provisions and additional topics related to the management of the pelagic longline fishery in future rulemakings and in the comprehensive three-year review of the IBQ Program.

Comment 4: One comment stated that the IBQ Program, as implemented under Amendment 7, is not consistent with several requirements of the Magnuson-Stevens Act including: The IBQ Program does not provide pelagic longline fishermen with a reasonable opportunity to harvest the Longline category BFT quota; the IBQ Program does not minimize disadvantages to U.S. fishermen; utilization of BFT quota under the IBQ Program could result in unfair and inequitable allocation of quota to pelagic longline fishermen; the IBQ Program does not provide fair and equitable distribution of access privileges; and the IBQ Program, as a limited access privilege program (LAPP), does not promote fishing safety, fishery conservation and management, or social and economic benefits.

Response: This comment challenges the implementation of Amendment 7 to the 2006 Consolidated HMS FMP, which was adopted through separate notice and comment rulemaking finalized in December 2014. The issues raised in this comment are beyond the scope of this rulemaking. NMFS notes that in litigation brought against the Secretary of Commerce following issuance of the final rule for Amendment 7, pelagic longline fishermen and dealers alleged that implementation of Amendment 7, including the IBQ Program, failed to comply with provisions of the Magnuson-Stevens Act, similar to the issues raised in this comment. The federal district court for the Eastern District of North Carolina rejected Plaintiffs' claims and upheld Amendment 7 as consistent with the Magnuson-Stevens Act and other applicable law (see Willie R. Etheridge Seafood Co. v. Pritzker, 2016 WL 1126014 (E.D.N.C., Mar. 21, 2016)).

The NMFS Assistant Administrator has determined that the final rule is consistent with the 2006 Consolidated HMS FMP and its amendments, the Magnuson-Stevens Act, ATCA, and other applicable law.

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

This action is categorically excluded from the requirement to prepare an environmental assessment (EA) in accordance with the National Environmental Policy Act and NOAA administrative order NAO 216-6 (as preserved by NAO 216-6A). This action may be categorically excluded since it is a change to a previously analyzed and approved fishery management plan, and the change will have no substantive effect, individually or cumulatively, on the human environment beyond that already analyzed in the Environmental Impact Statement for Amendment 7 (79 FR 71510, December 2, 2014) and in the EA for the final rule that increased the U.S. BFT quota (for 2015 and until changed) based on the recommendation of the International Commission for the Conservation of Atlantic Tunas (80 FR 52198, August 28, 2015). Inseason quota allocations to the Longline category do not modify the annual U.S. BFT quota nor the fishing mortality associated with that quota. Minor modifications of allocations to vessels may contribute somewhat to determining when fishing mortality occurs but not in any meaningful way that would change the environmental impacts given the small amounts of quota at issue and the fact that such transfers do not alter the overall allowable mortality under the U.S. BFT quota. Furthermore, this action will not directly affect fishing effort, fishing gear, interactions with threatened or endangered species, or other relevant behaviors that could have additional environmental impacts. Thus, there is no environmental or ecological effect different than what was analyzed previously.

NMFS has prepared a Regulatory Impact Review (RIR), and a Final Regulatory Flexibility Analysis (FRFA), which present and analyze anticipated social, and economic impacts of the alternatives contained in this rule. The list of alternatives and their analyses are provided in the RIR and are not repeated here in their entirety. A copy of the RIR prepared for this final rule is available from NMFS (see ADDRESSES).

A FRFA was prepared, as required by section 604 of the Regulatory Flexibility Act (RFA, 5 U.S.C. 604 et seq.), and is included below. The FRFA describes the economic impact this final rule will have on small entities. A description of the action, why it is being implemented, and the legal basis for this action are contained in the SUMMARY section of the preamble.

The goal of the RFA is to minimize the economic burden of federal regulations on small entities. To that end, the RFA directs federal agencies to assess whether the regulation is likely to result in significant economic impacts to a substantial number of small entities, and identify and analyze any significant alternatives to the rule that accomplish the objectives of applicable statutes and minimizes any significant effects on small entities.

Section 604(a)(1) of the RFA requires a FRFA to contain a statement of the need for and objectives of the rule. The purpose of this rulemaking, consistent with the 2006 Consolidated HMS FMP objectives, the Magnuson-Stevens Act, and other applicable law, is to provide NMFS additional flexibility when distributing quota inseason to the Longline category. Through this final rule, NMFS may distribute quota inseason either to all qualified IBQ share recipients (those who have associated their share with a vessel) or to permitted Atlantic Tunas Longline vessels with recent fishing activity whether or not they are associated with IBQ shares.

Since January 1, 2015, NMFS has received requests (among other suggestions about the IBQ Program and management of the pelagic longline fishery) to distribute quota inseason to those vessels that have recent fishing activity (whether associated with IBQ shares or not) to optimize fishing opportunity and account for dead discards, rather than distributing it equally to all IBQ share recipients, some of whom end up neither using it, nor making it available to other vessel owners through the IBQ leasing program. In advance of and at the March 2016 HMS Advisory Panel meeting, pelagic longline fishery participants expressed concerns about the availability of IBQ allocation as implemented under Amendment 7. Longline fishery participants have stated that, while they were able to obtain sufficient IBQ allocation by leasing it under the conditions that applied in 2015, those conditions were temporary. They are concerned, however, that as additional requirements began to apply in 2016, the IBQ Program could negatively impact vessel operations and finances given the pricing of IBQ, the distribution of quota among permit holders as implemented by Amendment 7, and the behavior of some permit holders who, for example, they say hold on to IBQ for the entire season without participating in the fishery or engaging in leasing. Longline fishery participants requested that NMFS take further steps to provide more access to quota for those vessels with recent fishing activity to reduce the dependence on qualified IBQ share recipients, some of whom are not participating in the fishery or engaging in leasing.

After looking at the issues raised by the fishery participants and at trends in IBQ leasing and utilization for 2015, it became apparent that additional options are needed regarding the distribution of inseason transfers of BFT quota within the Longline category to assist NMFS in providing reasonable opportunities to fish for target species under the limits imposed by the IBQ Program, to optimize distribution of BFT quota transferred inseason to the Longline category, and to encourage proper functioning of the IBQ leasing program as anticipated under Amendment 7. To account for the highly variable nature of the BFT caught in the pelagic longline fishery and maintain flexibility in the regulations, this action provides NMFS with an additional option when distributing quota inseason to the Longline category.

The objective of this rule is to provide additional flexibility regarding the distribution of inseason Atlantic BFT quota transfers to the Longline category in order to facilitate the management of Atlantic HMS resources in a manner that maximizes resource sustainability and fishing opportunity, while minimizing, to the greatest extent possible, the socioeconomic impacts on affected fisheries.

Section 604(a)(2) of the RFA requires a summary of the significant issues raised by the public comments in response to the IRFA, a summary of the Agency's assessment of such issues, and a statement of any changes made in the rule as a result of such comments. NMFS received five written comments on the proposed rule during the comment period, three of which expressed support for the proposed flexibility in distribution of inseason BFT quota and for efficient use of quota through inseason distribution to vessels with recent fishing activity, including new vessels. Two written comments expressed qualified support for the proposed measures but suggested modified approaches to quota disbursement (i.e., a tiered approach based on previous year activity that would not disburse inseason quota equally among recipients but disburse varying amounts based on levels of fishing activity). None of the comments addressed the economic impacts of the proposed measure. No changes were made to the rule as a result of the public comments.

Section 604(a)(3) of the RFA requires the Agency to respond to any comments filed by the Chief Counsel for Advocacy of the Small Business Administration (SBA) in response to the proposed rule, and a detailed statement of any change made in the rule as a result of such comments. NMFS did not receive any comments from the Chief Counsel for Advocacy of the SBA in response to the proposed rule.

Section 604(a)(4) of the RFA requires agencies to provide an estimate of the number of small entities to which the rule would apply. The SBA has established size criteria for all major industry sectors in the United States, including fish harvesters. SBA's regulations provide that an agency may develop its own industry-specific size standards after consultation with Advocacy and an opportunity for public comment (see 13 CFR 121.903(c)). Under this provision, NMFS may establish size standards that differ from those established by the SBA Office of Size Standards, but only for use by NMFS and only for the purpose of conducting an analysis of economic effects in fulfillment of the agency's obligations under the RFA. To utilize this provision, NMFS must publish such size standards in the Federal Register. In a final rule that became effective on July 1, 2016 (80 FR 81194, December 29, 2015), NMFS established a small business size standard of $11 million or less in annual gross receipts for all businesses in the commercial fishing industry (NAICS 11411) for RFA compliance purposes. NMFS considers all HMS Atlantic Tunas Longline permit holders (280 as of October 2015) to be small entities because these vessels have reported annual gross receipts of less than $11 million for commercial fishing. The average annual gross revenue per active pelagic longline vessel was estimated to be $187,000 based on the 170 active vessels between 2006 and 2012, and that produced an estimated $31.8 million in total revenue annually. The maximum annual revenue for any pelagic longline vessel between 2006 and 2015 was $1.9 million, well below the NMFS small business size threshold of $11 million in gross receipts for commercial fishing.

NMFS has determined that this rule will apply to the small businesses associated with the 136 Atlantic Tunas Longline permits with IBQ shares and the additional permitted Atlantic Tunas Longline vessels that fish with quota leased through the IBQ Program. The impacts on these small businesses are described below in the discussion of alternatives considered. NMFS has determined that this action will not likely directly affect any small organizations or small government jurisdictions defined under the RFA.

Section 604(a)(5) of the RFA requires Agencies to describe any new reporting, record-keeping and other compliance requirements. This rule does not contain any new collection of information, reporting, or record-keeping requirements.

One of the requirements of a FRFA is to describe any alternatives which accomplish the stated objectives and which minimize any significant economic impacts. These impacts are discussed below. Additionally, the RFA (5 U.S.C. 603(c)(1)-(4)) lists four general categories of “significant” alternatives that would assist an agency in the development of significant alternatives. These categories of alternatives are: (1) Establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such small entities; (3) use of performance rather than design standards; and (4) exemptions from coverage of the rule, or any part thereof, for small entities.

In order to meet the objectives of this final rule, consistent with the Magnuson-Stevens Act and ATCA, NMFS cannot establish differing compliance requirements for small entities or exempt small entities from compliance requirements. Thus, there are no alternatives discussed that fall under the first and fourth categories described above. As for the second category, the objective of this rule is to provide additional flexibility regarding the distribution of inseason Atlantic BFT quota transfers to the Longline category, and therefore does not impact or change compliance and reporting requirements for small entities. The IBQ Program was designed to adhere to performance standards, the third category above; modifications to the regulations implementing the IBQ Program simply make adjustments to the administration of those underlying performance standards. NMFS analyzed several different alternatives in this action and the rationale that NMFS used to determine the alternative for achieving the desired objectives is described below.

The first alternative is the “no action” (status quo) alternative. The second alternative, the selected alternative, will provide NMFS the flexibility to allocate quota inseason to qualified IBQ share recipients (those who have associated their share with a vessel) or to permitted Atlantic Tunas Longline vessels with any recent fishing activity, whether or not they are associated with IBQ shares. The third alternative would provide NMFS the flexibility to allocate quota inseason to qualified IBQ share recipients with recent fishing activity or IBQ leasing activity. The economic impacts of these three alternatives are detailed below.

Under all three alternatives, NMFS would continue to consider the regulatory determination criteria for inseason or annual adjustments under 50 CFR 635.27(a)(8), and if NMFS decided that inseason allocation to the Longline category was warranted to increase the amount of quota available to pelagic longline vessels, NMFS would allocate additional quota. The difference among the alternatives is the specific Atlantic Tunas Longline permit holders that would receive distribution of inseason BFT quota.

Under the “no action” alternative, NMFS would distribute the transferred quota in equal amounts to all 136 qualified IBQ share recipients, which include vessels actively fishing and vessels not actively fishing. This is the manner in which NMFS conducted inseason transfers from the Reserve to the Longline category in July 2015 and January 2016 (80 FR 45098, July 29, 2015; 81 FR 19, January 4, 2016). For each of these 34 mt quota transfers, 0.25 mt (551 lb) of IBQ were distributed equally to each of the 136 qualified IBQ share recipients under Amendment 7. IBQ allocation was distributed via the electronic IBQ system to the vessel accounts with permits with IBQ shares associated with a vessel. For those permits with IBQ shares that were not associated with a vessel at the time of the quota transfer, the IBQ is not usable by the permit holder (i.e., may not be leased or used to account for BFT) until the permit is associated with a vessel. Based on the average 2015 IBQ lease price of $3.34 per pound, the economic value of such an inseason transfer of 551 lb per vessel would be approximately $1,840 per vessel owner under the “no action” alternative.

Under the selected alternative, NMFS may allocate quota inseason either to each of the 136 qualified IBQ share recipients or to all permitted Atlantic Tunas Longline vessels with recent fishing activity. In 2015, there were 104 active pelagic longline vessels (based on logbook data). If NMFS assumes, for example, a future inseason transfer of 34 mt distributed equally among vessels with recent fishing activity, each of those 104 active vessels would receive 0.327 mt (721 lb) under the selected alternative. Based on the average 2015 IBQ lease price of $3.34 per pound, the economic value of such an inseason transfers of 721 lb per vessel would be approximately $2,408 per vessel owner under the selected alternative. Active vessel owners would receive $568 more in value (31 percent more quota) than under the “no action” (status quo) alternative.

This increased allocation will help these active vessels to remain fishing longer under fewer quota constraints and reduce the transaction costs associated with finding the same amount of additional quota. The qualified IBQ share recipients with no fishing activity (36 in 2015) would not receive the 551 lb of IBQ worth approximately $1,840 per vessel that they could have received under the status quo alternative if they were to lease their quota to other permit holders. Thus, the cost of this alternative will mainly be limited to the forgone ability to lease out allocation that they otherwise would have received. Under Amendment 7, the purpose of leasing is to accommodate various levels of unintended catch of BFT and to facilitate directed fishing for Atlantic swordfish, other tunas, and other pelagic species. The few Atlantic Tunas Longline vessels that fished that were not associated with IBQ shares but that leased allocation from qualified IBQ share recipients (four in 2015) will receive quota under the selected alternative worth approximately $2,408 per vessel. Such an inseason transfer will help facilitate participation by new entrants to the fishery by lowering their costs to obtain quota.

Under the third alternative, NMFS would have the flexibility to distribute quota inseason to qualified IBQ share recipients with any recent fishing activity or qualified IBQ share recipients that leased out quota to other Atlantic Tunas Longline permit holders. This differs from the selected alternative in two key ways. First, under the third alternative, only qualified IBQ share recipients with recent activity would receive an inseason transfer, while under the selected alternative all permitted Atlantic Tunas Longline vessels with recent activity would receive an inseason transfer. Secondly, under the third alternative, relevant activity would include IBQ leasing activity in addition to the recent fishing activity required under the selected alternative. In 2015, of the 104 pelagic longline vessels with recent fishing activity, 100 vessels were associated with IBQ shares (four vessels were not associated with IBQ shares in 2015). In addition, 5 vessels were associated with IBQ shares that did not fish but did lease their allocation to other vessels. If NMFS assumes a future inseason transfer of 34 mt, each of those 105 vessels associated with IBQ shares (100 with recent fishing activity and 5 that leased IBQ allocation) would receive 0.324 mt (714 lb) under the third alternative. Based on the average 2015 IBQ lease price of $3.34 per pound, the economic value of such an inseason transfer of 714 lb per vessel would be approximately $2,385 per vessel owner. Vessels associated with IBQ shares with recent fishing activity or IBQ leasing activity would receive $545 more in value (30 percent more quota) than under the “no action” (status quo) alternative. This is $23 less per vessel than under the selected alternative. In addition, under the third alternative, fewer vessels with recent fishing activity would receive quota and new entrants would not receive quota. For these reasons, NMFS did not prefer the third alternative.

For the reasons set out in the preamble, 50 CFR part 635 is amended as follows:

Regulations governing the Atlantic herring fishery are found at 50 CFR part 648. The regulations require annual specification of the overfishing limit, acceptable biological catch (ABC), annual catch limit (ACL), optimum yield (OY), domestic harvest and processing, U.S. at-sea processing, border transfer, and sub-ACLs for each management area. The 2016 Domestic Annual Harvest was set as 104,800 metric tons; an additional 4,704 mt was added to this total due to an underharvest during the 2014 fishing year, and 3 percent of herring catch was set aside for research in the 2016-2018 specifications (81 FR 75731, November 1, 2016). After these adjustments, the resulting ACL for the 2016 fishing year was 106,360 mt, and the ACL allocated to Area 1A (sub-ACL) was 29,524 mt.

The Area 1A sub-ACL has 295 mt set aside for fixed gear fisheries west of Cutler, ME, until November 1, 2016. Due to the variability of Canadian catch in the New Brunswick weir fishery, a 1,000-mt portion of the 4,000-mt buffer between ABC and OY (the buffer to account for Canadian catch) is allocated to Area 1A, provided New Brunswick weir landings are lower than the amount specified in the buffer.

The NMFS Regional Administrator is required to monitor the fishery landings in the New Brunswick weir fishery each year. If New Brunswick weir fishery herring catch through October 1 is less than 4,000 mt, then 1,000 mt will be subtracted from the management uncertainty buffer and allocated to the ACL and Area 1A Sub-ACL as soon as possible. When such a determination is made, NMFS is required to publish a notification in the Federal Register to adjust the Area 1A sub-ACL upward for the remainder of the fishing year.

The Regional Administrator has determined, based on the best available information, that the New Brunswick weir fishery catch for fishing year 2016 through October 1, 2016, was 3,478 mt. Therefore, effective December 29, 2016, 1,000 mt will be allocated to the Area 1A sub-ACL, thereby increasing the fishing year 2016 Area 1A sub-ACL from 29,524 mt to 30,524 mt. Because any increase to a sub-ACL also increases the stock-wide ACL, this allocation increases the 2016 stock-wide ACL from 106,360 mt to 107,360 mt.

The allocation of 1,000 mt will be applied to the quota of Area 1A, which closed on October 18, 2016, before implementation of the 2016-2018 Atlantic herring specifications and management measures. The New Brunswick weir fishery allocation was delayed until the new specifications became effective (December 1, 2016).

When applied to the 2016 quota for Area 1A, this 1,000 mt increase will drop the catch total from 94.2 percent of the quota to 91.1 percent. NMFS closed Area 1A on October 18 based on the projection that herring catch would reach 92 percent of the quota for that area. In the case where projection falls short of the 92 percent limit, characteristics of the high volume herring fishery make it impracticable to reopen unless the underage is substantial. This is due to the capability of the herring fishing fleet to harvest a large percentage of the quota in only a few days, in which case a reopening would likely result in an overage of the quota before a closure could be imposed. For this reason, NMFS uses discretion in reopening the fishery, and generally would only do so in the case of a large underage. In this case, the allocation of 1,000 mt will only result in an underage of 0.9 percent and thus is not large enough to reopen the herring fishery in Area 1A. This notification principally ensures that the 2018 fishery adjustments for underharvest/overharvest (which are based on 2016 catch) will be accurate.

This action is required by 50 CFR part 648 and is exempt from review under Executive Order 12866.

The Assistant Administrator for Fisheries, NOAA (AA), finds good cause pursuant to 5 U.S.C. 553(b)(B) to waive prior notice and the opportunity for public comment because it is impracticable and contrary to the public interest. This action increases the sub-ACL for Area 1A by 1,000 mt (29,524 mt to 30,524 mt) through December 31, 2016, thereby relieving a more restrictive catch limit. The regulations at § 648.201(f) require such action to help mitigate some of the negative economic effects associated with the reduction in the Area 1A sub-ACL in the 2016-2018 specifications process. The herring fishery extends from January 1 to December 31. Data indicate the New Brunswick weir fishery landed 3,478 mt through October 1, 2016. Allowing for prior notice and public comment on this adjustment is impracticable because regulations require this allocation to occur as quickly as is practicable and for the remainder of the fishing year. NMFS was unable to allocate this quota until the 2016-2018 herring specifications became effective on December 1, 2016. Because of the limited time between December 1 and the end of the U.S. herring fishing year on December 31, the delay associated with soliciting public comment would result in implementation of regulations after the effective end date of the fishing year, which would violate the intent of the regulation and would not benefit the public. Further, this is a nondiscretionary action required by provisions in the 2016-2018 Atlantic Herring Specifications and Management Measures (herring specifications), which previously provided notice to the public that this 1,000 mt allocation would occur if the Canadian catch level was sufficiently low, and offered full opportunity to comment on this. The adjustment required by the regulation is formulaic. This action simply effectuates thesemandatory calculations. NMFS further finds, pursuant to 5 U.S.C. 553(d)(3), good cause to waive the 30-day delayed effectiveness period for the reasons stated above.