Page Range | 24009-24452 | |
FR Document |
Page and Subject | |
---|---|
81 FR 24036 - Suspension of Community Eligibility | |
81 FR 24096 - Sunshine Act Meetings | |
81 FR 24147 - Sunshine Act Meeting | |
81 FR 24135 - Sunshine Act Meeting Notice | |
81 FR 24150 - Order of Suspension of Trading; in the Matter of CelLynx Group, Inc., Dot VN, Inc., and Global Health Voyager, Inc. | |
81 FR 24150 - Order of Suspension of Trading; In the Matter of Gold Hills Mining, Ltd., Massive Dynamics, Inc., Medisafe 1 Technologies Corp., and MDU Communications International, Inc. | |
81 FR 24149 - Sunshine Act Meeting | |
81 FR 24068 - Board of Regents, Uniformed Services University of the Health Sciences; Notice of Federal Advisory Committee Meeting | |
81 FR 24038 - Hazardous Materials Table, Special Provisions, Hazardous Materials Communications, Emergency Response Information, Training Requirements, and Security Plans | |
81 FR 24089 - Proposed Issuance of NPDES General Permit for Idaho Drinking Water Treatment Facilities (Permit Number IDG380000) | |
81 FR 24158 - Release of Waybill Data | |
81 FR 24176 - Commission on Care | |
81 FR 24069 - Submission for OMB Review; Comment Request | |
81 FR 24093 - Cross-Media Electronic Reporting: Authorized Program Revision Approval, Commonwealth of Pennsylvania | |
81 FR 24155 - Agency Information Collection Activities: Proposed Request and Comment Request | |
81 FR 24130 - Public Safety Bomb Suit Standard, NIJ Standard-0117.01 | |
81 FR 24131 - Comment Request for Information Collection for the Ready to Work Partnership Grants Evaluation, New Collection | |
81 FR 24054 - Agency Information Collection Activities-Identifying Program Components and Practices That Influence Supplemental Nutrition Assistance Program (SNAP) Application Processing Timeliness Rates | |
81 FR 24090 - Agency Information Collection Activities OMB Responses | |
81 FR 24173 - Funding Opportunity for America's Marine Highways Projects | |
81 FR 24052 - 1994 Tribal Scholars Program; Notice of Request for Reinstatement of a Previously Approved Collection | |
81 FR 24139 - Advisory Committee on Reactor Safeguards; Notice of Meeting | |
81 FR 24105 - Announcement of the Intent To Award Single-Source Cooperative Agreement to the University of Southern California, Department of Family Medicine and Geriatrics, National Center on Elder Abuse | |
81 FR 24044 - Receipt of Several Pesticide Petitions Filed for Residues of Pesticide Chemicals in or on Various Commodities | |
81 FR 24136 - Entergy Nuclear Operations, Inc.; Vermont Yankee Nuclear Power Station | |
81 FR 24119 - National Advisory Council; Meeting | |
81 FR 24141 - Entergy Nuclear Operations, Inc.; Vermont Yankee Nuclear Power Station | |
81 FR 24009 - Energy Conservation Program: Energy Conservation Standards for Refrigerated Bottled or Canned Beverage Vending Machines; Correction | |
81 FR 24145 - Service Contracts Inventory | |
81 FR 24130 - Amended Certification Regarding Eligibility To Apply for Worker Adjustment Assistance | |
81 FR 24084 - Environmental Management Advisory Board Meeting | |
81 FR 24146 - Submission for OMB Review; Comments Request | |
81 FR 24083 - Environmental Management Site-Specific Advisory Board, Northern New Mexico | |
81 FR 24059 - Ferrovanadium From the Republic of Korea: Initiation of Less-Than-Fair-Value Investigation | |
81 FR 24105 - Disease, Disability, and Injury Prevention and Control Special Emphasis Panel (SEP): Initial Review | |
81 FR 24070 - Proposed Collection; Comment Request | |
81 FR 24063 - Endangered Species; File No. 17183 | |
81 FR 24127 - Proposed Information Collection; National Park Service Rivers, Trails, and Conservation Assistance Program Application | |
81 FR 24057 - Siuslaw Resource Advisory Committee | |
81 FR 24170 - Qualification of Drivers; Exemption Applications; Vision | |
81 FR 24058 - Materials Processing Equipment Technical Advisory Committee; Notice of Partially Closed Meeting | |
81 FR 24047 - World Trade Center Health Program; Petition 011-Autoimmune Diseases; Finding of Insufficient Evidence | |
81 FR 24065 - Endangered and Threatened Species; Take of Anadromous Fish | |
81 FR 24022 - Drawbridge Operation Regulation; Red River, Alexandria, LA | |
81 FR 24063 - Submission for OMB Review; Comment Request | |
81 FR 24090 - Information Collection Request Submitted to OMB for Review and Approval; Comment Request; NESHAP for Printing and Publishing Industry (Renewal) | |
81 FR 24092 - Information Collection Request Submitted to OMB for Review and Approval; Comment Request; Emission Guidelines and Compliance Times for Existing Municipal Solid Waste Landfills (Renewal) | |
81 FR 24088 - Information Collection Request Submitted to OMB for Review and Approval; Comment Request; Distribution of Offsite Consequence Analysis Information Under Section 112(r)(7)(H) of the Clean Air Act (CAA), as Amended (Renewal) | |
81 FR 24091 - Agency Information Collection Activities; Assessment of Environmental Performance Standards and Ecolabels for Federal Procurement; Submitted to OMB for Review and Approval; Comment Request | |
81 FR 24024 - Safety Zone; Newport Beach Harbor Grand Canal Bridge Construction; Newport Beach, CA | |
81 FR 24022 - Safety Zone; Pacific Ocean, North Shore Oahu, HI-Recovery Operations | |
81 FR 24053 - Codex Alimentarius Commission: Meeting of the Codex Alimentarius Commission | |
81 FR 24158 - Northwest Tennessee Regional Port Authority-Construction and Operation Exemption-in Lake County, Tenn. | |
81 FR 24158 - West Branch Intermediate Holdings, LLC and Continental Rail, LLC-Continuance in Control Exemption-Central Gulf Acquisition Company | |
81 FR 24128 - Notice of Inventory Completion: Utah Museum of Natural History, Salt Lake City, UT | |
81 FR 24135 - Federal Council on the Arts and the Humanities; Arts and Artifacts Indemnity Panel Advisory Committee | |
81 FR 24147 - Section 407 Proceeding | |
81 FR 24128 - Certain Height-Adjustable Desk Platforms and Components Thereof; Institution of Investigation | |
81 FR 24094 - Information Collections Being Submitted for Review and Approval to the Office of Management and Budget | |
81 FR 24095 - Information Collection Being Reviewed by the Federal Communications Commission | |
81 FR 24050 - Petition for Declaratory Ruling Filed by National Cable & Telecommunications Association and American Cable Association | |
81 FR 24132 - QPS Evaluation Services: Grant of Expansion of Recognition | |
81 FR 24161 - Qualification of Drivers; Exemption Applications; Diabetes Mellitus | |
81 FR 24108 - Request for Public Comment: 60-Day Information Collection: Indian Self-Determination and Education Assistance Act Contracts | |
81 FR 24067 - Measuring Cross-Border Data Flows: Unmet Data Needs Roundtable | |
81 FR 24097 - Formations of, Acquisitions by, and Mergers of Bank Holding Companies | |
81 FR 24101 - Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding Company | |
81 FR 24129 - Agency Information Collection Activities: Proposed eCollection; eComments Requested: OSC Charge Form | |
81 FR 24158 - Tribal Transportation Self-Governance Program | |
81 FR 24126 - Notice of Filing of Plats of Survey; South Dakota | |
81 FR 24096 - Agency Information Collection Activities: Announcement of Board Approval Under Delegated Authority and Submission to OMB | |
81 FR 24038 - Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; Reef Fish Fishery of the Gulf of Mexico; Gag Management Measures | |
81 FR 24132 - Whistleblower Protection Advisory Committee (WPAC) Charter Renewal | |
81 FR 24125 - Renewal of Agency Information Collection for Grazing Permits | |
81 FR 24133 - QPS Evaluation Services Inc.: Grant of Renewal and Expansion of Recognition | |
81 FR 24104 - Information Collection; Bankruptcy | |
81 FR 24103 - Information Collection; Commerce Patent Regulations | |
81 FR 24068 - Agency Information Collection Activities; Proposed Collection; Comment Request; Virginia Graeme Baker Pool and Spa Safety Act; Compliance Form | |
81 FR 24176 - Notice of Meeting; Open Session | |
81 FR 24087 - James and Sharon Jans; Notice of Application Accepted for Filing, Soliciting Comments, Motions To Intervene, and Protests | |
81 FR 24085 - White Oak Solar, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 Authorization | |
81 FR 24087 - Interconnect Solar Development LLC; Notice of Petition for Enforcement | |
81 FR 24084 - Combined Notice of Filings #2 | |
81 FR 24085 - Combined Notice of Filings #1 | |
81 FR 24086 - Records Governing Off-the-Record Communications; Public Notice | |
81 FR 24026 - Expanded Access to Non-VA Care Through the Veterans Choice Program; Correction | |
81 FR 24059 - Environmental Technologies Trade Advisory Committee Public Meeting | |
81 FR 24064 - Proposed Information Collection; Comment Request; National Estuaries Restoration Inventory | |
81 FR 24033 - Suspension of Community Eligibility | |
81 FR 24037 - Final Flood Elevation Determinations | |
81 FR 24113 - Proposed Flood Hazard Determinations | |
81 FR 24120 - Final Flood Hazard Determinations | |
81 FR 24110 - National Institute of Neurological Disorders and Stroke; Notice of Closed Meeting | |
81 FR 24113 - National Institute of Dental & Craniofacial Research; Notice of Closed Meeting | |
81 FR 24110 - National Institute of Allergy and Infectious Diseases; Notice of Closed Meetings | |
81 FR 24110 - National Heart, Lung, and Blood Institute; Notice of Closed Meetings | |
81 FR 24111 - Eunice Kennedy Shriver National Institute of Child Health & Human Development (NICHD) Notice of Meeting | |
81 FR 24111 - National Center for Complementary & Integrative Health; Notice of Meeting | |
81 FR 24112 - National Toxicology Program Board of Scientific Counselors; Announcement of Meeting; Request for Comments | |
81 FR 24109 - Office of the Director, National Institutes of Health Notice of Meeting | |
81 FR 24122 - Changes in Flood Hazard Determinations | |
81 FR 24116 - Changes in Flood Hazard Determinations | |
81 FR 24101 - Proposed Agency Information Collection Activities; Comment Request | |
81 FR 24097 - Proposed Agency Information Collection Activities; Comment Request | |
81 FR 24151 - Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Adopt the CHX SNAP Incentive Program | |
81 FR 24153 - Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule to Amend the Fees Schedule | |
81 FR 24148 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Delete Obsolete Rules | |
81 FR 24030 - Approval and Promulgation of Implementation Plans; AR; Redesignation of the Crittenden County, 2008 8-Hour Ozone Nonattainment Area to Attainment | |
81 FR 24107 - Determination That THALITONE (Chlorthalidone USP) Tablets, 15 Milligrams, Were Not Withdrawn From Sale for Reasons of Safety or Effectiveness | |
81 FR 24106 - Assay Development and Validation for Immunogenicity Testing of Therapeutic Protein Products; Revised Draft Guidance for Industry; Availability | |
81 FR 24058 - Submission for OMB Review; Comment Request | |
81 FR 24171 - Petition for Waiver of Compliance | |
81 FR 24172 - Petition for Waiver of Compliance | |
81 FR 24041 - Refurbishing, Reconditioning, Rebuilding, Remarketing, Remanufacturing, and Servicing of Medical Devices Performed by Third-Party Entities and Original Equipment Manufacturers; Extension of Comment Period | |
81 FR 24057 - Submission for OMB Review; Comment Request | |
81 FR 24070 - Applications for New Awards; Investing in Innovation Fund-Development Grants | |
81 FR 24012 - Airworthiness Directives; Kaman Aerospace Corporation | |
81 FR 24385 - Banned Devices; Proposal To Ban Electrical Stimulation Devices Used To Treat Self-Injurious or Aggressive Behavior | |
81 FR 24027 - Approval and Promulgation of Air Quality Implementation Plans; Pennsylvania; Attainment Plan for the Lower Beaver Valley Nonattainment Area for the 2008 Lead National Ambient Air Quality Standards | |
81 FR 24029 - Approval of California Air Plan Revisions, San Joaquin Valley Unified Air Pollution Control District | |
81 FR 24419 - Supplemental Finding That It Is Appropriate and Necessary To Regulate Hazardous Air Pollutants From Coal- and Oil-Fired Electric Utility Steam Generating Units | |
81 FR 24347 - Child and Adult Care Food Program: Meal Pattern Revisions Related to the Healthy, Hunger-Free Kids Act of 2010 | |
81 FR 24229 - Medicare Program; Prospective Payment System and Consolidated Billing for Skilled Nursing Facilities Proposed Rule for FY 2017, SNF Value-Based Purchasing Program, SNF Quality Reporting Program, and SNF Payment Models Research | |
81 FR 24177 - Medicare Program; Inpatient Rehabilitation Facility Prospective Payment System for Federal Fiscal Year 2017 | |
81 FR 24014 - Examples of Program-Related Investments | |
81 FR 24019 - Mandatory Declassification Review Program | |
81 FR 24042 - Mandatory Declassification Review Program | |
81 FR 24010 - Airworthiness Directives; Bell Helicopter Textron Canada Helicopters | |
81 FR 24281 - Connect America Fund, ETC Annual Reports and Certifications, Developing a Unified Intercarrier Compensation Regime |
Food and Nutrition Service
Food Safety and Inspection Service
Forest Service
Office of Advocacy and Outreach
Rural Housing Service
Industry and Security Bureau
International Trade Administration
National Oceanic and Atmospheric Administration
National Telecommunications and Information Administration
Federal Energy Regulatory Commission
Centers for Disease Control and Prevention
Centers for Medicare & Medicaid Services
Community Living Administration
Food and Drug Administration
Indian Health Service
National Institutes of Health
Coast Guard
Federal Emergency Management Agency
Indian Affairs Bureau
Land Management Bureau
National Park Service
Justice Programs Office
Employment and Training Administration
Occupational Safety and Health Administration
Federal Aviation Administration
Federal Highway Administration
Federal Motor Carrier Safety Administration
Federal Railroad Administration
Maritime Administration
Pipeline and Hazardous Materials Safety Administration
Internal Revenue Service
Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, and notice of recently enacted public laws.
To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.thefederalregister.org and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions.
Office of Energy Efficiency and Renewable Energy, Department of Energy.
Final rule; correcting amendment.
On January 8, 2016, the U.S. Department of Energy published a final rule amending energy conservation standards for bottled and refrigerated beverage vending machines (beverage vending machines). This correction addresses a technical error in that final rule.
The U.S. Department of Energy (DOE) published a final rule in the
In final rule FR Doc. 2015-33074, published in the issue of Wednesday, January 8, 2016 (81 FR 1027), make the following correction:
On page 1112, in the second and third columns, remove amendatory instruction 3.
Confidential business information, Energy conservation, Household appliances, Imports, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, 10 CFR part 429 is corrected as follows:
42 U.S.C. 6291-6317.
(j)
(i) If the representative value of refrigerated volume is found to be valid, the certified refrigerated volume will be used as the basis for calculation of maximum daily energy consumption for the basic model.
(ii) If the representative value of refrigerated volume is found to be invalid, the average measured refrigerated volume determined from the tested unit(s) will serve as the basis for calculation of maximum daily energy consumption for the tested basic model.
(2)
(
(
Federal Aviation Administration (FAA), DOT.
Final rule.
We are superseding Airworthiness Directive (AD) 2010-19-51 for Bell Helicopter Textron Canada (Bell) Model 222, 222B, 222U, 230, and 430 helicopters. AD 2010-19-51 required inspecting parts of the main rotor hydraulic servo actuator (servo actuator) for certain conditions and replacing any unairworthy parts before further flight. This new AD requires installing a servo actuator with a new stainless steel piston rod. This AD was prompted by a collective servo actuator malfunction. We are issuing this AD to detect corrosion on a piston rod, which could result in failure of the servo actuator and consequent loss of helicopter control.
This AD is effective May 31, 2016.
The Director of the Federal Register approved the incorporation by reference of a certain document listed in this AD as of December 9, 2010 (75 FR 71540, November 24, 2010).
For service information identified in this final rule, contact Bell Helicopter Textron Canada Limited, 12,800 Rue de l'Avenir, Mirabel, Quebec J7J1R4; telephone (450) 437-2862 or (800) 363-8023; fax (450) 433-0272; or at
You may examine the AD docket on the Internet at
Matt Wilbanks, Aviation Safety Engineer, Regulations and Policy Group, Rotorcraft Directorate, FAA, 10101 Hillwood Pkwy., Fort Worth, TX 76177; telephone (817) 222-5110; email
On August 12, 2013, we issued a notice of proposed rulemaking (NPRM) that was published in the
After the NPRM was published, we received comments from Bell requesting we mandate replacement of servo actuator P/N 222-382-001-107 with servo actuator part number P/N 222-382-001-111 even if no pitting or penetration of the base metal is found during the inspection, in accordance with the replacement provisions in its Alert Service Bulletin (ASB) 430-11-46, Revision A, dated June 20, 2012. In light of those comments, we determined that our AD should retain all of the inspection requirements of AD 2010-19-51 and also include compliance times specified in Revision A of the ASB for replacing servo actuator P/N 222-382-001-107 with servo actuator P/N 222-382-001-111 or -111FM. Therefore, we revised the proposed actions accordingly. Because those changes expanded the scope of the original NPRM, we determined that it was necessary to reopen the comment period to provide additional opportunity for the public to comment. A supplemental notice of proposed rulemaking (SNPRM) was published in the
Since the SNPRM was issued, the FAA Southwest Regional Office has relocated and a group email address has been established for requesting an FAA Alternative Method of Compliance for a helicopter of foreign design. We have updated this information throughout this AD.
We have also removed the proposed paragraph (f)(7) from the Required Actions section, which would have required overhauling servo actuator P/N 222-382-001-111 or P/N 222-382-001-
We gave the public the opportunity to participate in developing this AD, but we received no comments on the SNPRM (80 FR 34332, June 16, 2015).
These helicopters have been approved by the aviation authority of Canada and are approved for operation in the United States. Pursuant to our bilateral agreement with Canada, TCCA, its technical representative, has notified us of the unsafe condition described in the TCCA AD. We are issuing this AD because we evaluated all information provided by TCCA and determined the 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.
The TCCA AD requires inspecting each servo actuator to determine the condition of the piston rod assembly no later than 5 hours upon receiving the original issue of its AD. This AD requires inspecting each servo actuator to determine the condition of the piston rod assembly before further flight.
We reviewed Woodward HRT Service Bulletin 141600-67-02, dated August 18, 2010, which provides instructions for disassembling the servo actuator and for cleaning and inspecting the piston rod and nut. 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
We also reviewed Bell ASB 222-11-111 for Model 222 and 222B helicopters, ASB 222U-11-82 for Model 222U helicopters, ASB 230-11-43 for Model 230 helicopters, and ASB 430-11-46 for Model 430 helicopters, all Revision A and all dated June 22, 2012. The ASBs contain, and require compliance with, Woodward HRT Service Bulletin 141600-67-03, dated February 14, 2012, to upgrade the servo actuator by replacing the piston rod and then re-identifying the servo actuator dash number with “-111FM.” The compliance time for upgrading the servo actuator varies depending on the results of the inspections required by Woodward HRT Service Bulletin 141600-67-02, dated August 18, 2010. The Bell ASBs also provide an alternative inspection procedure for servo actuator P/N 222-382-001-107 that has not reached certain hours TIS and where the servo actuator cannot be upgraded. TCCA classified these ASBs as mandatory and issued AD No. CF-2010-29R1, dated July 26, 2012, to ensure the continued airworthiness of these helicopters.
We estimate that this AD affects 146 helicopters of U.S. Registry and that labor costs average $85 a work-hour. Based on these estimates, we expect the following costs:
• Inspecting a servo actuator requires 4 work-hours per actuator for a labor cost of $340. No parts are needed for a total cost of $1,020 per helicopter and $148,920 for the U.S. fleet given 3 actuators per helicopter.
• Replacing a servo actuator requires 8 work-hours for a labor cost of $680. Parts cost $35,700 for a total cost of $36,380 per actuator.
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, 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.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
This AD applies to Bell Helicopter Textron Canada (Bell) Model 222, 222B, 222U, 230, and 430 helicopters, with a main rotor hydraulic servo actuator (servo actuator) part number (P/N) 222-382-001-107 installed, certificated in any category.
This AD defines the unsafe condition as corrosion or a nonconforming grind relief on the output piston rod assembly (piston rod). This condition could lead to failure of the piston rod, failure of the servo actuator, and subsequent loss of helicopter control.
This AD supersedes AD 2010-19-51, Amendment 39-16523 (75 FR 71540, November 24, 2010).
This AD becomes effective May 31, 2016.
You are responsible for performing each action required by this AD within the specified compliance time unless it has already been accomplished prior to that time.
Before further flight:
(1) Disassemble each servo actuator to gain access to the piston rod as shown in Figures 1 through 5 and by following the Accomplishment Instructions, paragraph 3.A., Part I., of Woodward HRT Alert Service Bulletin No. 141600-67-02, dated August 18, 2010 (Woodward ASB).
(2) Clean the entire piston rod and nut using acetone and a nylon bristle brush removing all contaminates to allow for inspection. Inspect the grind relief configuration for the piston rod and nut as shown in Figure 6 of the Woodward ASB. If the grind relief is unacceptable as shown in Figure 6, replace the piston rod and the nut with airworthy parts.
(3) Using a 10X or higher magnifying glass, visually inspect the nut for any corrosion or any damage to the threads. If you find any corrosion or any damage to the threads, replace the nut with an airworthy nut.
(4) Using a 10X or higher magnifying glass, visually inspect the piston rod as shown in Figure 7 of the Woodward ASB for any corrosion, visible lack of cadmium plate (gold or gray color), or damage to the piston rod. For the purposes of this AD, damage to the piston rod is defined as pitting, a visible scratch, a crack, or a visible abrasion.
(i) If there is any corrosion or visible lack of cadmium plate or any damage to the piston rod in the Critical Areas as shown in Figure 7 of the Woodward ASB, replace the servo actuator with servo actuator P/N 222-382-001-111 or P/N 222-382-001-111FM before further flight.
(ii) If there is any corrosion or visible lack of cadmium plate on the piston rod in areas that are not considered Critical Areas as shown in Figure 7 of the Woodward ASB, rework the piston rod by removing any surface corrosion that has not penetrated into the base material by lightly buffing. Clean the part using acetone and a nylon bristle brush to remove any residue. Comply with paragraphs (f)(5) through (f)(6) of this AD. Within 1,200 hours time-in-service (TIS) or 1 year, whichever occurs first, replace the servo actuator with servo actuator P/N 222-382-001-111 or P/N 222-382-001-111FM.
(iii) If there is any corrosion that is red or orange in color, magnetic particle inspect the piston rod for a crack.
(A) If there is a crack, replace the servo actuator with servo actuator, P/N 222-382-001-111 or P/N 222-382-001-111FM before further flight.
(B) If there is no crack, comply with paragraphs (f)(5) through (f)(6) of this AD. Within 2,400 hours TIS or 2 years, whichever occurs first, replace the servo actuator with servo actuator P/N 222-382-001-111 or P/N 222-382-001-111FM.
(iv) If there is no corrosion, visible lack of cadmium plate, or damage to the piston rod, comply with paragraphs (f)(5) through (f)(6) of this AD. Within 3,000 hours TIS or 4 years, whichever occurs first, replace the servo actuator with servo actuator P/N 222-382-001-111 or P/N 222-382-001-111FM.
(5) Inspect the portion of the piston rod for any absence of cadmium plating (bare base metal), as shown in Figure 7 of the Woodward ASB. If there is any bare base metal on the piston rod in this area, apply brush cadmium plating to all bare and reworked areas using SPS5070 or equivalent 0.0002 to 0.0005 inch thick and rework the piston rod by following the Accomplishment Instructions, paragraph C., Part III, C.1.1.1. through C.1.1.3., of the Woodward ASB.
(6) Reassemble the servo actuator by following the Accomplishment Instructions, paragraph C, Part III, 1.1.4. through 3.3.4. of the Woodward ASB.
Compliance with the Woodward ASB or with AD 2010-19-51 (75 FR 71540, November 24, 2010) before the effective date of this AD is considered acceptable for compliance with the corresponding inspections specified in paragraph (f) of this AD. If you replaced the piston rod pursuant to the Woodward ASB or paragraph (d)(1) or (d)(3) of AD 2010-19-51, apply the requirements of paragraph (f)(4)(iv) of this AD.
(1) The Manager, Safety Management Group, FAA, may approve AMOCs for this AD. Send your proposal to: Matt Wilbanks, Aviation Safety Engineer, Regulations and Policy Group, Rotorcraft Directorate, FAA, 10101 Hillwood Pkwy., Fort Worth, TX 76177; telephone (817) 222-5110; email
(2) For operations conducted under a 14 CFR part 119 operating certificate or under 14 CFR part 91, subpart K, we suggest that you notify your principal inspector, or lacking a principal inspector, the manager of the local flight standards district office or certificate holding district office, before operating any aircraft complying with this AD through an AMOC.
(1) Bell Alert Service Bulletin (ASB) No. 222-11-111 for Model 222 and 222B helicopters, ASB No. 222U-11-82 for Model 222U helicopters, ASB No. 230-11-43 for Model 230 helicopters, and ASB No. 430-11-46 for Model 430 helicopters, all Revision A and all dated June 22, 2012, which are not incorporated by reference, contain additional information about the subject of this AD. For service information identified in this AD, contact Bell Helicopter Textron Canada Limited, 12,800 Rue de l'Avenir, Mirabel, Quebec J7J1R4; telephone (450) 437-2862 or (800) 363-8023; fax (450) 433-0272; or at
(2) The subject of this AD is addressed in the Transport Canada Civil Aviation (TCCA) AD No. CF-2010-29R1, dated July 26, 2012. You may view the TCCA AD on the Internet at
Joint Aircraft Service Component (JASC) Code: 6730, Rotorcraft Servo System.
(1) The Director of the Federal Register approved the incorporation by reference (IBR) of the service information listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.
(2) You must use this service information as applicable to do the actions required by this AD, unless the AD specifies otherwise.
(3) The following service information was approved for IBR on December 9, 2010 (75 FR 71540, November 24, 2010).
(i) Woodward HRT Alert Service Bulletin No. 141600-67-02, dated August 18, 2010.
(ii) Reserved.
(4) For Woodward HRT service information identified in this AD, contact Bell Helicopter Textron Canada Limited, 12,800 Rue de l'Avenir, Mirabel, Quebec J7J1R4; telephone (450) 437-2862 or (800) 363-8023; fax (450) 433-0272; or at
(5) You may view this service information at FAA, Office of the Regional Counsel, Southwest Region, 10101 Hillwood Pkwy., Room 6N-321, Fort Worth, TX 76177. For information on the availability of this material at the FAA, call (817) 222-5110.
(6) You may view this service information that is incorporated by reference at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call (202) 741-6030, or go to:
Federal Aviation Administration (FAA), DOT.
Final rule.
We are adopting a new airworthiness directive (AD) for Kaman Aerospace Corporation (Kaman) Model K-1200 helicopters. This AD requires revising the “Flight Limitations—NO LOAD” and “Flight Limitations—
This AD is effective May 31, 2016.
For service information identified in this final rule, contact Kaman Aerospace Corporation, Old Windsor Rd., P.O. Box 2, Bloomfield, Connecticut 06002-0002; telephone (860) 242-4461; fax (860) 243-7047; or at
You may examine the AD docket on the Internet at
Kirk Gustafson, Aviation Safety Engineer, Boston Aircraft Certification Office, Engine & Propeller Directorate, FAA, 1200 District Avenue, Burlington, Massachusetts 01803; telephone (781) 238-7190; email
On January 21, 2016, at 81 FR 3344, the
The NPRM published with the previous mailing address for the Boston Aircraft Certification Office. We have revised this contact information in this final rule to reflect the new mailing address.
We gave the public the opportunity to participate in developing this AD, but we did not receive any comments on the NPRM (81 FR 3344, January 21, 2016).
We have reviewed the relevant information and determined that an unsafe condition exists and is likely to exist or develop on other products of the same type design and that air safety and the public interest require adopting the AD requirements as proposed.
Kaman has issued Kaman K-1200 RFM, Revision 5, dated April 14, 2015. This revision of the limitations section of the RFM inserts, for both load operations and no load operations, a warning and limitations about departing from rearward to forward flight, a maximum rearward flight speed of 25 knots, a maximum sideward flight speed of 17 knots, and a prohibition on weather-vanning takeoffs and departures as a method to turn aircraft.
We estimate that this AD will affect 16 helicopters of U.S. Registry. We estimate that operators may incur the following costs in order to comply with this AD. At an average labor rate of $85 per work-hour, we expect revising the RFM will require 0.5 work-hour, for cost of about $43 per helicopter, or $688 for the U.S. fleet.
Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.
We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.
This AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.
For the reasons discussed above, I certify that this AD:
(1) Is not a “significant regulatory action” under Executive Order 12866;
(2) Is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979);
(3) Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction; and
(4) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
We prepared an economic evaluation of the estimated costs to comply with this AD and placed it in the AD docket.
Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.
Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows:
49 U.S.C. 106(g), 40113, 44701.
This AD applies to Model K-1200 helicopters, certificated in any category.
This AD defines the unsafe condition as a main rotor (M/R) blade striking the opposing rotor's flight controls. This condition could result in damage to the M/R flight controls and subsequent loss of control of the helicopter.
This AD becomes effective May 31, 2016.
You are responsible for performing each action required by this AD within the specified compliance time unless it has already been accomplished prior to that time.
Within 10 hours time-in-service, revise Section 2 Limitations of the Kaman K-1200 Rotorcraft Flight Manual (RFM) by inserting a copy of this AD into the RFM or by making pen-and-ink changes, as follows:
(1) In the “Flight Limitations—NO LOAD” and “Flight Limitations—WITH LOAD” sections, add the information in Figure 1 to paragraph (e)(1) of this AD.
(2) In the “Flight Limitations—NO LOAD” and “Flight Limitations—WITH LOAD” sections, add the following: Maximum rearward flight speed: 25 knots. Maximum sideward flight speed: 17 knots. Weather-vanning takeoffs/departures as a method to turn aircraft: Prohibited.
Incorporating the changes contained in Kaman K-1200 RFM, Revision 5, dated April 14, 2015, before the effective date of this AD is considered acceptable for compliance with the corresponding actions specified in paragraph (e) of this AD.
(1) The Manager, Boston Aircraft Certification Office, FAA, may approve AMOCs for this AD. Send your proposal to: Kirk Gustafson, Aviation Safety Engineer, Boston Aircraft Certification Office, Engine & Propeller Directorate, FAA, 1200 District Avenue, Burlington, Massachusetts 01803; telephone (781) 238-7190; email
(2) For operations conducted under a 14 CFR part 119 operating certificate or under 14 CFR part 91, subpart K, we suggest that you notify your principal inspector, or lacking a principal inspector, the manager of the local flight standards district office or certificate holding district office before operating any aircraft complying with this AD through an AMOC.
Kaman K-1200 RFM, Revision 5, dated April 14, 2015, which is not incorporated by reference, contains additional information about the subject of this final rule. For service information identified in this final rule, contact Kaman Aerospace Corporation, Old Windsor Rd., P.O. Box 2, Bloomfield, Connecticut 06002-0002; telephone (860) 242-4461; fax (860) 243-7047; or at
Joint Aircraft Service Component (JASC) Code: 6710, Main Rotor Control.
Internal Revenue Service (IRS), Treasury.
Final regulations.
This document contains final regulations that provide guidance to private foundations on program-related investments. The final regulations provide a series of examples illustrating investments that qualify as program-related investments. In addition to private foundations, these final regulations affect foundation managers who participate in the making of program-related investments.
These regulations are effective April 25, 2016.
Robin Ehrenberg at (202) 317-4086 (not a toll-free number).
This document contains amendments to 26 CFR part 53 under section 4944(a) of the Internal Revenue Code (Code). Section 4944(a) imposes an excise tax on a private foundation that makes an investment that jeopardizes the carrying out of its exempt purposes (a “jeopardizing investment”). Section 4944(c) provides that investments that are program-related investments (“PRIs”) are not jeopardizing investments. Section 4944(c) defines a PRI as an investment: (1) The primary purpose of which is to accomplish one or more of the purposes described in section 170(c)(2)(B); and (2) no significant purpose of which is the production of income or the appreciation of property.
The regulations under section 4944(c) provide that an investment is made primarily to accomplish one or more of the purposes described in section
Since 1972, § 53.4944-3(b) has contained nine examples illustrating investments that qualify as PRIs and one example of an investment that does not qualify as a PRI. These long-standing examples focus on domestic situations principally involving economically disadvantaged individuals and deteriorated urban areas.
On April 19, 2012, a notice of proposed rulemaking (REG-144267-11) relating to PRIs was published in the
No public hearing on the NPRM was requested or held; however, 15 comments from the public were received. All comments are available at
While commenters generally lauded the issuance of the proposed regulations and supported issuing them as final regulations, some commenters suggested a few modifications to the examples contained in the proposed regulations.
One commenter suggested amending Example 11, which involved a private foundation's investment in a subsidiary of a drug company for the development of a vaccine to prevent a disease that predominantly affects poor individuals in developing countries. Under the investment agreement described in the Example, the subsidiary is required to distribute the vaccine to the poor individuals in developing countries at a price that is affordable to the affected population and to promptly publish its research results. The commenter recommended that the example be modified to make it clear that the subsidiary can also sell the vaccine to those who can afford it at fair market value prices. The final regulations amend Example 11 to adopt this clarification, which is appropriate given that the Example also specifies that Y's primary purpose in making the investment is to fund scientific research in the public interest and no significant purpose of the investment involves the production of income or the appreciation of property.
The commenter also recommended removing the publication requirement described in Example 11, contending that the provision of the vaccine to the poor at affordable prices without more furthers the accomplishment of exempt purposes. Example 11 illustrated a known fact pattern that was presented in a private letter ruling issued by the IRS. Although it is not possible for the regulations to provide examples illustrating every conceivable fact pattern, the Treasury Department and the IRS note that other fact patterns that do not contain all of the same elements as those illustrated by Example 11 may nonetheless further an exempt purpose if the requirements of the regulations are otherwise satisfied. Accordingly, the final regulations do not adopt this comment.
One commenter suggested modifying Example 13, which involved a private foundation that accepts common stock in a business enterprise as part of a loan to the business and that plans to liquidate the stock as soon as the business becomes profitable or it is established that the business will never become profitable. The commenter requested that the sentence in the example regarding the liquidation of the stock be removed or amended to clarify whether a foundation must sell its stock in a business that becomes profitable for the investment in that stock to be a PRI. In response to the comment, this sentence has been removed from the example. The Treasury Department and the IRS note, however, that the establishment, at the outset of an investment, of an exit condition that is tied to the foundation's exempt purpose in making the investment can be an important indication that a foundation's primary purpose in undertaking the investment is in fact accomplishment of the exempt purpose.
Two commenters suggested modifying Example 15, which involved loans by a private foundation to two poor individuals living in a developing country where a natural disaster has occurred. One commenter noted that loans that enable poor persons to become economically self-sufficient by starting a small business qualify as PRIs without the necessity for a natural disaster to have occurred. In response to this comment, the final regulations amend Example 15 to eliminate the reference to a natural disaster. Another commenter suggested modifying Example 15 to refer to a “foreign country” rather than a “developing country,” noting that providing disaster relief to a foreign country, whether or not it is a developing country, furthers the accomplishment of exempt purposes. As noted in the preamble to the NPRM, several examples in the proposed regulations illustrated the principle that an activity conducted in a foreign country furthers an exempt purpose if the same activity would further an exempt purpose if conducted in the United States. This principle applies equally to all foreign countries. However, the final regulations do not change the reference to a developing country in Example 15, because the example illustrates PRIs in the context of microloans, which are currently more common in developing countries. In addition, because organizations making microloans often provide loans to many individuals, the final regulations modify the example to reference loans to a group of individuals, rather than two specific individuals with identified business endeavors.
One commenter suggested modifying Example 16, which described a loan to a limited liability company (LLC), to describe an equity investment in an
Finally, one commenter recommended that the examples be amended to demonstrate the ability of a foundation to set PRI terms at above the prime rate. The examples in the proposed regulations generally referred to the interest rate or rate of return on a PRI as being less than the expected “market rate” for an investment of comparable risk and did not contain any suggestion that the rate of return of a PRI must fall below an absolute percentage threshold, such as the prime rate, to demonstrate no significant purpose involving the production of income or the appreciation of property. In addition, one example, Example 12, referred to the potential for a high rate of return if the recipient business is successful. Thus, the final regulations do not adopt this comment to expressly state in an example that the rate of return on a PRI may exceed the prime rate.
The preamble to the NPRM noted that the additional PRI examples in the proposed regulations illustrated that: (1) An activity conducted in a foreign country furthers an exempt purpose if the same activity would further an exempt purpose if conducted in the United States; (2) the exempt purposes served by a PRI are not limited to situations involving economically disadvantaged individuals and deteriorated urban areas; (3) the recipients of PRIs need not be within a charitable class if they are the instruments for furthering a exempt purpose; (4) a potentially high rate of return does not automatically prevent an investment from qualifying as a PRI; (5) PRIs can be achieved through a variety of investments, including loans to individuals, tax-exempt organizations and for-profit organizations, and equity investments in for-profit organizations; (6) a credit enhancement arrangement may qualify as a PRI; and (7) a private foundation's acceptance of an equity position in conjunction with making a loan does not necessarily prevent the investment from qualifying as a PRI.
One commenter recommended that this statement of principles (which it called “extremely helpful guidance”) be included in the text of the final regulations so that the principles are readily accessible to grantmaking organizations. The principles helped identify areas in which clarification through examples would be helpful. The Treasury Department and the IRS believe that each of these seven principles is adequately reflected in the new examples themselves. Accordingly, the final regulations do not adopt this comment. Alternatively, the commenter suggested that the principles be preserved in another readily accessible place, like the IRS' Web site. In response to this comment, the IRS intends to post the principles on its Web site.
A number of commenters suggested additional examples to be added to the final regulations. For example, two commenters recommended including examples involving PRIs to support news media or mixed-income housing or to lessen the burdens of government, while another commenter suggested examples involving economic development through the promotion of technology-based enterprises. The proposed regulations contained nine new examples involving many different exempt purposes, such as scientific research in the public interest, combating environmental deterioration, and education. The Treasury Department and the IRS believe these additional examples adequately illustrate the principle that a PRI may accomplish a variety of exempt purposes. These regulations under section 4944 are not intended to provide an example of every exempt purpose, and there are many examples of exempt purposes in both regulations and sub-regulatory guidance under section 501(c)(3). Therefore, additional examples of exempt purposes are not provided in these regulations. However, if commenters or other organizations believe additional guidance is needed under section 501(c)(3) regarding whether particular activities further charitable purposes, private letter rulings or guidance of general applicability may be requested. Accordingly, the final regulations do not adopt these comments.
One commenter recommended including an additional example of a foundation assuming certain risks to catalyze the entry of private investment capital. The proposed regulations already included two examples of a foundation assuming certain risks (specifically, in the form of a deposit agreement and a guarantee) to catalyze the entry of private investment capital. Thus, the Treasury Department and the IRS do not believe that additional examples are necessary to illustrate this possibility and the final regulations do not adopt this comment.
Two commenters requested examples involving investments in low-profit limited liability companies (L3Cs) or benefit corporations. On the other hand, one commenter approved of the lack of any examples suggesting the need for a recipient of a PRI to be an L3C or benefit corporation, noting that the IRS has not recognized L3C or benefit corporation status as relevant to the determination of whether an investment is a PRI and also noting potential concerns with and lack of universal endorsement of the L3C model. The proposed regulations included one example involving a loan to an LLC; the results of that example would be the same if the limited liability company described in the example were an L3C. Similarly, the results of examples in which the PRI recipient is a corporation would apply equally if the recipient were a benefit corporation. The Treasury Department and the IRS see no need to amend the examples to refer more narrowly to an L3C or benefit corporation when such status is not determinative of the examples' conclusions. Accordingly, the final regulations do not adopt these comments.
One commenter noted that the example in the proposed regulations of a PRI financing medical research involved a disease that predominantly affects developing countries and requested another example involving a disease that affects developed countries (but with respect to which a lack of sufficient market incentives exist for research and development of new treatments). Scientific research carried
Finally, one commenter requested additional guidance regarding the circumstances under which PRIs may result in impermissible private benefit and specifically requested an example of a PRI that has the primary purpose of benefitting indigent members of a charitable class but that also benefits non-indigent individuals (other than the recipient of the PRI itself). This commenter appeared to be requesting guidance on the circumstances under which private benefit conferred by an investment might affect an organization's exempt status under section 501(c)(3) rather than under which the private benefit might affect the investment's status as a PRI, and as such would be outside of the scope of these final regulations. The effect of private benefit on exempt status is addressed in examples in regulations under section 501(c)(3) as well as a number of revenue rulings.
A number of commenters requested that the IRS adopt procedures that would allow private foundations considering a PRI to obtain determinations or guidance from the IRS regarding the PRI in ways that are more expeditious and less costly than the private letter ruling process.
One commenter proposed that the IRS create a process similar to the one established under section 4945(g) for approving procedures for making grants to individuals. Under § 53.4945-4(d)(3), if a foundation that properly submits a request for approval of grant procedures has not been notified by the IRS that its procedures are not acceptable by the 45th day after the submission, the procedures will be considered as approved from the date of submission until receipt of actual notice from the IRS that such procedures do not meet the necessary requirements. Section 4945(g) specifically requires that procedures for making grants to individuals be approved by the IRS to avoid an excise tax being applied to such grants. Section 4944 contains no such requirement of advance approval of PRIs and hence is not analogous to section 4945(g). Accordingly, the final regulations do not adopt this comment.
One commenter recommended allowing private foundations to request determinations that their investments are PRIs using Form 8940,
Two commenters recommended allowing IRS private letter rulings (PLRs) regarding PRIs to be relied on by other private foundations, so that each private foundation investing in one project that qualifies as a PRI does not have to obtain its own PLR. We note that a PLR is not necessary for an investment to qualify as a PRI. Furthermore, allowing a private foundation to rely on a letter ruling issued to another taxpayer would require amendments to section 11 of Rev. Proc. 2015-1 (2015-1 IRB 1), not the proposed regulations, and raises tax administration issues. Hence it is outside the scope of these final regulations.
In addition to the changes noted above, the final regulations also correct the reference to section 4942 in § 53.4944-3(a)(2)(ii) to reflect prior changes to that statute.
IRS Revenue Procedures, Revenue Rulings notices, notices and other guidance cited in this preamble are published in the Internal Revenue Bulletin (or Cumulative Bulletin) and are available from the Superintendent of Documents, U.S. Government Printing Office, Washington, DC 20402, or by visiting the IRS Web site at
Certain IRS regulations, including this one, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required. It has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these regulations, and because the regulation does not impose a collection of information on small entities, the Regulatory Flexibility Act (5 U.S.C. chapter 6) does not apply. Pursuant to section 7805(f) of the Code, the NPRM preceding this regulation was submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on its impact on business and no comments were received.
The principal author of these regulations is Robin Ehrenberg, Office of the Associate Chief Counsel (Tax Exempt and Government Entities). However, other personnel from the Treasury Department and the IRS participated in their development.
Excise Taxes, Foundations, Investments, Lobbying, Reporting and Recordkeeping Requirements, Trusts and trustees.
Accordingly, 26 CFR part 53 is amended as follows:
26 U.S.C. 7805 * * *
The additions read as follows:
(b) * * *
X is a business enterprise that researches and develops new drugs. X's research demonstrates that a vaccine can be developed within ten years to prevent a disease that predominantly affects poor individuals in developing countries. However, neither X nor other commercial enterprises like X will devote their resources to develop the vaccine because the potential return on investment is significantly less than required by X or other commercial enterprises to undertake a project to develop new drugs. Y, a private foundation, enters into an investment agreement with X in order to induce X to develop the vaccine. Pursuant to the investment agreement, Y purchases shares of the common stock of S, a subsidiary corporation that X establishes to research and develop the vaccine. The agreement requires S to distribute the vaccine to poor individuals in developing countries at a price that is affordable to the affected population, although, the agreement does not preclude S from selling the vaccine to other individuals at a market rate. The agreement also requires S to publish the research results, disclosing substantially all information about the results that would be useful to the interested public. S agrees that the publication of its research results will be made as promptly after the completion of the research as is reasonably possible without jeopardizing S's right to secure patents necessary to protect its ownership or control of the results of the research. The expected rate of return on Y's investment in S is less than the expected market rate of return for an investment of similar risk. Y's primary purpose in making the investment is to fund scientific research in the public interest. No significant purpose of the investment involves the production of income or the appreciation of property. The investment significantly furthers the accomplishment of Y's exempt activities and would not have been made but for such relationship between the investment and Y's exempt activities. Accordingly, Y's purchase of the common stock of S is a program-related investment.
Q, a developing country, produces a substantial amount of recyclable solid waste materials that are currently disposed of in landfills and by incineration, contributing significantly to environmental deterioration in Q. X is a new business enterprise located in Q. X's only activity will be collecting recyclable solid waste materials in Q and delivering those materials to recycling centers that are inaccessible to a majority of the population. If successful, the recycling collection business would prevent pollution in Q caused by the usual disposition of solid waste materials. X has obtained funding from only a few commercial investors who are concerned about the environmental impact of solid waste disposal. Although X made substantial efforts to procure additional funding, X has not been able to obtain sufficient funding because the expected rate of return is significantly less than the acceptable rate of return on an investment of this type. Because X has been unable to attract additional investors on the same terms as the initial investors, Y, a private foundation, enters into an investment agreement with X to purchase shares of X's common stock on the same terms as X's initial investors. Although there is a high risk associated with the investment in X, there is also the potential for a high rate of return if X is successful in the recycling business in Q. Y's primary purpose in making the investment is to combat environmental deterioration. No significant purpose of the investment involves the production of income or the appreciation of property. The investment significantly furthers the accomplishment of Y's exempt activities and would not have been made but for such relationship between the investment and Y's exempt activities. Accordingly, Y's purchase of the X common stock is a program-related investment.
Assume the facts as stated in
X is a business enterprise located in V, a rural area in State Z. X employs a large number of poor individuals in V. A natural disaster occurs in V, causing significant damage to the area. The business operations of X are harmed because of damage to X's equipment and buildings. X has insufficient funds to continue its business operations and conventional sources of funds are unwilling or unable to provide loans to X on terms it considers economically feasible. In order to enable X to continue its business operations, Y, a private foundation, makes a loan to X bearing interest below the market rate for commercial loans of comparable risk. Y's primary purpose in making the loan is to provide relief to the poor and distressed. No significant purpose of the loan involves the production of income or the appreciation of property. The loan significantly furthers the accomplishment of Y's exempt activities and would not have been made but for such relationship between the loan and Y's exempt activities. Accordingly, the loan is a program-related investment.
Y, a private foundation, makes loans bearing interest below the market rate for commercial loans of comparable risk to poor individuals who live in W, a developing country, to enable them to start small businesses such as a roadside fruit stand. Conventional sources of funds were unwilling or unable to provide such loans on terms they consider economically feasible. Y's primary purpose in making the loans is to provide relief to the poor and distressed. No significant purpose of the loans involves the production of income or the appreciation of property. The loans significantly further the accomplishment of Y's exempt activities and would not have been made but for such relationship between the loans and Y's exempt activities. Accordingly, the loans to the poor individuals who live in W are program-related investments.
X is a limited liability company treated as a partnership for federal income tax purposes. X purchases coffee from poor farmers residing in a developing country, either directly or through farmer-owned cooperatives. To fund the provision of efficient water management, crop cultivation, pest management, and farm management training to the poor farmers by X, Y, a private foundation, makes a loan to X bearing interest below the market rate for commercial loans of comparable risk. The loan agreement requires X to use the proceeds from the loan to provide the training to the poor farmers. X would not provide such training to the poor farmers absent the loan. Y's primary purpose in making the loan is to educate poor farmers about advanced agricultural methods. No significant purpose of the loan involves the production of income or the appreciation of property. The loan significantly furthers the accomplishment of Y's exempt activities and would not have been made but for such relationship between the loan and Y's exempt activities. Accordingly, the loan is a program-related investment.
X is a social welfare organization that is recognized as an organization described in section 501(c)(4). X was formed to develop and encourage interest in painting, sculpture, and other art forms by, among other things, conducting weekly community art exhibits. X needs to purchase a large exhibition space to accommodate the demand for exhibition space within the community. Conventional sources of funds are unwilling or unable to provide funds to X on terms it considers economically feasible. Y, a private foundation, makes a loan to X at an interest rate below the market rate for commercial loans of comparable risk to fund the purchase of the new space. Y's primary purpose in making the loan is to promote the arts. No significant purpose of the loan involves the production of income or the appreciation of property. The loan significantly furthers the accomplishment of Y's exempt activities and would not have been made but for such
X is a non-profit corporation that provides child care services in a low-income neighborhood, enabling many residents of the neighborhood to be gainfully employed. X meets the requirements of section 501(k) and is recognized as an organization described in section 501(c)(3). X's current child care facility has reached capacity and has a long waiting list. X has determined that the demand for its services warrants the construction of a new child care facility in the same neighborhood. X is unable to obtain a loan from conventional sources of funds including B, a commercial bank because of X's credit record. Pursuant to a deposit agreement, Y, a private foundation, deposits $h in B, and B lends an identical amount to X to construct the new child care facility. The deposit agreement requires Y to keep $h on deposit with B during the term of X's loan and provides that if X defaults on the loan, B may deduct the amount of the default from the deposit. To facilitate B's access to the funds in the event of default, the agreement requires that the funds be invested in instruments that allow B to access them readily. The deposit agreement also provides that Y will earn interest at a rate of t% on the deposit. The t% rate is substantially less than Y could otherwise earn on this sum of money, if Y invested it elsewhere. The loan agreement between B and X requires X to use the proceeds from the loan to construct the new child care facility. Y's primary purpose in making the deposit is to further its educational purposes by enabling X to provide child care services within the meaning of section 501(k). No significant purpose of the deposit involves the production of income or the appreciation of property. The deposit significantly furthers the accomplishment of Y's exempt activities and would not have been made but for such relationship between the deposit and Y's exempt activities. Accordingly, the deposit is a program-related investment.
Assume the same facts as stated in
(c)
Office of the Director of National Intelligence.
Direct final rule.
The Office of the Director of National Intelligence (ODNI) is publishing this direct final rule pursuant to Executive Order 13526, relating to classified national security information. It provides procedures for members of the public to request from ODNI a Mandatory Declassification Review (MDR) of information classified under the provisions of Executive Order 13526 or predecessor orders such that the agency may retrieve it with reasonable effort. This rule also informs requesters where to send requests for an MDR.
This rule is effective June 24, 2016 without further action, unless adverse comment is received by May 25, 2016. If adverse comment is received, ODNI will publish a timely withdrawal of the rule in the
You may submit comments by any of the following methods: By mail to the Office of the Director of National Intelligence, Director of the Information Management Division, Washington, DC 20511, by facsimile at (703) 874-8910, or by email at
Jennifer L. Hudson, (703) 874-8085.
It is the policy of the ODNI to act in matters relating to national security information in accordance with Executive Order 13526 and directives issued thereunder by the Information Security Oversight Office (ISOO). The purpose of this rule is to assist in implementing specific sections of Executive Order 13526 concerning the Mandatory Declassification Review (MDR). This document is being issued as a direct final rule without prior notice of proposed rulemaking as allowed by the Administrative Procedure Act, 5 U.S.C. 553(b)(3)(A) for rules of agency procedure and interpretation.
This rule is not a significant regulatory action for the purposes of Executive Order 12866. This rule is not a major rule as defined in 5 U.S.C. Chapter 8, Congressional Review of Agency Rulemaking. As required by the Regulatory Flexibility Act, we certify that this rule will not have a significant impact on a substantial number of small entities because it applies only to federal agencies.
Declassification, Information, Intelligence, National security information.
50 U.S.C. 3001; E.O. 13526, 75 FR 707, 3 CFR, 2009 Comp, p. 298.
(a)
(b)
For purposes of this part:
For general information on the regulation in this part or to submit a request for a MDR, please direct your communication by mail to the Office of the Director of National Intelligence, Director of the Information Management Division, Washington, DC 20511; by facsimile to (703) 874-8910; or by email to
The ODNI welcomes suggestions for improving the administration of our MDR program in accordance with Executive Order 13526. Suggestions should identify the specific purpose and the items for consideration. The ODNI will respond to all communications and take such actions as determined feasible and appropriate.
Address all communications to the point of contact as specified in § 1704.3. Clearly describe, list, or label said communication as an MDR Request.
MDR requests will not be accepted from a foreign government entity or any representative thereof. MDR requests will not be accepted for documents required to be submitted for prepublication review or other administrative process pursuant to an approved nondisclosure agreement; for information that is the subject of pending litigation; nor for any document or material containing information from within an operational file exempted from search and review, publication, and disclosure under the FOIA. If the ODNI has reviewed the requested information for declassification within the past two years, the ODNI will not conduct another review, but the D/IMD will notify the requester of this fact and the prior review decision. Requests will not be accepted from requesters who have outstanding fees for MDR or FOIA requests with the ODNI or another federal agency.
An MDR request shall describe the document or material containing the information with sufficient specificity to enable the ODNI to locate it with a reasonable amount of effort.
(a)
(b)
(1) As a matter of administrative discretion, the interest of the United States Government would be served, or
(2) It is in the public interest to provide responsive records because the disclosure is likely to contribute significantly to the public understanding of the operations or activities of the United States Government and is not primarily in the commercial interest of the requester.
(c)
(d)
(e)
(2)
(3)
(f)
(g)
(a)
(b)
(c)
(d)
(a)
(1)
(2)
(3)
(b)
Coast Guard, DHS.
Notice of deviation from drawbridge regulations.
The Coast Guard has issued a temporary deviation from the operating schedule that governs the US 165 (Jackson Street) Drawbridge across the Red River, mile 88.6, at Alexandria, Louisiana. The deviation is necessary to allow the bridge owner time to install new pinion bearings essential to the continued safe operation of the drawbridge. This deviation allows the bridge to remain in the closed-to-navigation position for approximately 6 days spanning a 2-week period.
This deviation is effective from May 31, 2016 through June 9, 2016.
The docket for this deviation, (USCG-2016-0196) is available at
If you have questions on this temporary deviation, call or email Eric A. Washburn, Bridge Administrator, Western Rivers, Coast Guard; telephone 314-269-2378, email
The Louisiana Department of Transportation and Development requested a temporary deviation for the US 165 (Jackson Street) Drawbridge, across the Red River, mile 88.6, at Alexandria, Louisiana. This deviation allows the bridge to remain in the closed-to-navigation position from 8 a.m. on May 31, 2016 to 8 p.m. on June 2, 2016 and from 8 a.m. on June 7, 2016 to 8 p.m. on June 9, 2016. This deviation is necessary for the bridge owner to install new pinion bearings.
The US 165 (Jackson Street) Drawbridge currently operates in accordance with 33 CFR 117.491(b).
The US 165 (Jackson Street) Drawbridge provides a vertical clearance of 40.0 feet above normal pool in the closed-to-navigation position. Navigation on the waterway consists primarily of commercial tows and recreational watercraft and will not be significantly impacted. This temporary deviation has been coordinated with waterway users. No objections were received.
The bridge will not be able to open for emergencies and there are no alternate routes for vessels transiting this section of the Red River. The Coast Guard will also inform the users of the waterways through our Local and Broadcast Notices to Mariners of the change in operating schedule for the bridge so the vessel operators can arrange their transits to minimize any impact caused by the temporary deviation.
In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the effective period of this temporary deviation. This deviation from the operating regulations is authorized under 33 CFR 117.35.
Coast Guard, DHS.
Temporary final rule.
The Coast Guard is establishing a temporary safety zone for the navigable waters of the North Shore of Oahu approximately 2.5NM North West of Hale'iwa small boat harbor. The safety zone will encompass all waters extending one nautical mile in all directions around the location of ongoing salvage operations, as described below. The safety zone is needed to protect personnel, vessels, and the marine environment from potential hazards associated with ongoing operations to salvage the remains of two downed helicopters in this area. A temporary safety zone was previously enforced in the same area from March 4, 2016 through April 01, 2016 to protect personnel, vessels, and the marine environment from the potential hazards associated with these salvage operations. A new temporary safety zone in the area is necessary to complete recovery of the debris from the helicopters. Entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port (COTP) Honolulu or his designated representative.
This rule is effective without actual notice from April 25, 2016 through 3:00 p.m. (HST) on April 29, 2016. For the purposes of enforcement, actual notice will be used from 3:00 p.m. (HST) on April 1, 2016 until April 25, 2016.
To view documents mentioned in this preamble as being available in the docket, go to
If you have questions concerning this rule, call or email Lieutenant Commander Nicolas Jarboe, Waterways Management Division, U.S. Coast Guard Sector Honolulu at (808) 541-4359 or
On January 15, 2016, the Coast Guard was informed of a helicopter crash off the North Shore of Oahu between Ka'Ena Point and Kahuku Point. The COTP Honolulu determined that potential hazards associated with the salvage efforts constitute a safety concern for anyone within the designated safety zone. This rule is
The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to the authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule. An NPRM is impracticable because Sector Honolulu was notified on March 29, 2016 of the need for ongoing salvage operations in response to the mishap. Thus, delaying the effective date of this rule to wait for a comment period to run would be impracticable because it would inhibit the Coast Guard's ability to protect the public and vessels from the hazards associated with the on-going salvage operations.
We are issuing this rule, and under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this temporary rule effective less than 30 days after publication in the
The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. On January 15, 2016, the Coast Guard was informed of a helicopter crash off the North Shore of Oahu between Ka'Ena Point and Kahuku Point. The COTP Honolulu determined that potential hazards associated with the salvage efforts constitute a safety concern for anyone within the designated safety zone. This rule is necessary to protect personnel, vessels, and the marine environment within the navigable waters of the safety zone while salvage operations remain on-going.
This rule establishes a safety zone from 3:00 p.m. (HST) on April 1, 2016 through 3:00 p.m. (HST) on April 29, 2016, or until the salvage operations are complete, whichever is earlier. If the safety zone is terminated prior to April 29, 2016, the Coast Guard will provide notice via a broadcast notice to mariners. The safety zone is located within the COTP zone (See 33 CFR 3.70-10) and will encompass all waters extending one nautical mile in all directions around the location of the salvage operations being conducted in location 21°38′01″ N., 158°07′54″ W. This zone extends from the surface of the water to the ocean floor and is intended to protect personnel, vessels, and the marine environment in these navigable waters from potential hazards associated with the salvage operations of two downed helicopters in this area. No vessel or person will be permitted to enter the safety zone absent the express authorization of the COTP or his designated representative.
We developed this rule after considering numerous statutes and Executive order related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has not been designated a “significant regulatory action,” under Executive Order 12866. Accordingly, it has not been reviewed by the Office of Management and Budget.
We conclude that this rule is not a significant regulatory action because we anticipate that it will have minimal impact on the economy, will not interfere with other agencies, will not adversely alter the budget of any grant or loan recipients, and will not raise any novel legal or policy issues. The safety zone created by this rule will be relatively small and vessels can safely navigate around it. Under certain conditions, moreover, vessels may still transit through the safety zone when permitted by the Captain of the Port.
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.
While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on a substantial number of small entities.
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the
Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.
This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.
Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments,
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.
We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone with a duration of twenty eight days or until the salvage operations are complete. It is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction.
The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the
Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.
For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:
33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.
(a)
(b)
(c)
(1) All persons are required to comply with the general regulations governing safety zones found in this part.
(2) Entry into or remaining in this zone is prohibited unless expressly authorized by the COTP or his designated representative.
(3) Persons desiring to transit the safety zone identified in paragraph (a) of this section may contact the COTP at the Command Center telephone number (808) 842-2600 and (808) 842-2601, fax (808) 842-2642 or on VHF channel 16 (156.8 Mhz) to seek permission to transit the zone. If permission is granted, all persons and vessels must comply with the instructions of the COTP or his designated representative and proceed at the minimum speed necessary to maintain a safe course while in the zone.
(4) The U.S. Coast Guard may be assisted in the patrol and enforcement of the safety zone by Federal, State, and local agencies.
(d)
(e)
Coast Guard, DHS.
Temporary final rule.
The Coast Guard is establishing a temporary safety zone in the waters of the Newport Harbor Grand Canal on Balboa Island. This temporary safety zone is being established to provide for the safety of the waterway users during bridge construction over a 10 month period. Transiting through or within this temporary safety zone is prohibited unless specifically authorized by the Captain of the Port, Los Angeles—Long Beach, or her designated representative.
This rule is effective without actual notice from April 25, 2016 through January 31, 2017. For purposes of enforcement, actual notice will be used from April 4, 2016 until April 25, 2016.
To view documents mentioned in this preamble as being available in the docket, go to
If you have questions on this rule, call or email BMC James Morgia, Waterways Management, U.S. Coast Guard Sector Los Angeles—Long Beach; telephone (310) 521-3860, email
The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” An NPRM is unnecessary and for this regulation because local authorities have already notified boaters not to transit the waterway during bridge construction and the Grand Canal waterway typically only experiences minimal vessel traffic, by small personal pleasure crafts. An NPRM is impractical for this regulation because the Coast Guard did not receive notice of the April 4 construction until March 8, 2016, and the construction schedule cannot be moved. Under 5 U.S.C. 553(d)(3), the Coast Guard finds good cause for making this rule effective less than 30 days after publication in the
Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective without 30 days advanced notice of the rule. Delaying the effective date of the rule is impractical and unnecessary for the same reasons specified above: (1) Local authorities have already notified boaters not to transit the waterway during bridge construction, (2) the Coast Guard did not receive notice of the April 4 construction until March 8, 2016, and (3) the Grand Canal waterway typically only experiences minimal vessel traffic, by small personal pleasure craft.
The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Los Angeles—Long Beach (COTP) has determined that potential hazards, like falling debris and heavy equipment operations in and near the waterway create a serious safety concern for anyone transiting the waterway during construction. This temporary safety zone is necessary to ensure the safety of, and reduce the risk to, the public, and mariners, in vicinity of the Newport Harbor Grand Canal.
The U.S. Coast Guard is establishing a temporary safety zone on April 4, 2016 to January 31, 2017, encompassing all navigable waters from the surface to the sea floor within the following coordinates: 33°36.311′ N. 117°53.323′ W., 33°36.437′ N. 117°53.324′ W., 33°36.438′ N. 117°53.343′ W., 33°36.312′ N. 117°53.341′ W. All coordinates displayed are referenced by North American Datum of 1983, World Geodetic System, 1984.
This temporary safety zone will be effective from 6:00 a.m. on April 4, 2016, to 11:59 p.m. on January 31, 2017. No vessel or person is permitted to operate in the safety zone without obtaining permission from the Captain of the Port (COTP) or the COTP's designated representative. Sector Los Angeles—Long Beach may be contacted on VHF-FM Channel 16 or 310-521-3801.
We developed this rule after considering numerous statutes and executive orders (E.O.s) related to rulemaking. Below we summarize our analyses based on a number of these statutes and E.O.s, and we discuss First Amendment rights of protestors.
E.O.s 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has not been designated a “significant regulatory action,” under E.O. 12866. Accordingly, it has not been reviewed by the Office of Management and Budget.
The implementation of this temporary safety zone is necessary for the protection of all waterway users. The size of the zone is the minimum necessary to provide adequate protection for the waterways users, adjoining areas, and the public. Any hardships experienced by persons or vessels are considered minimal compared to the interest in protecting the public.
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.
This rule will affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit or anchor within the designated area during the designated enforcement times. This temporary safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons: (i) This zone will support the safety of vessel traffic through the area, (ii) this zone is limited in scope and duration, (iii) the Coast Guard will issue Broadcast Notice to Mariners via VHF-FM marine channel 16 while the safety zone is enforced.
Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the
Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.
This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).
A rule has implications for federalism under E.O. 13132, Federalism, if it has a substantial direct effect on the States,
Also, this rule does not have tribal implications under E.O. 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.
We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under
The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the
Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.
For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:
33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.
(a)
(b)
(c)
(2) To seek permission to enter, contact the COTP or the COTP's representative by VHF-FM Channel 16 or 310-521-3801. Those in the safety zone must comply with all lawful orders or directions given to them by the COTP or the COTP's designated representative.
(d)
Department of Veterans Affairs.
Interim final rule; correcting amendment.
The Department of Veterans Affairs published in the
Effective on April 25, 2016.
Kristin J. Cunningham, Veterans Health Administration, (202) 382-2508 (this is not a toll-free number).
The Department of Veterans Affairs (VA) published in the
Administrative practice and procedure, Alcohol abuse, Alcoholism, Claims, Day care, Dental health, Drug abuse, Government contracts, Grant programs-health, Grant programs-veterans, Health care, Health facilities, Health professions, Health records, Homeless, Mental health programs, Nursing homes, Reporting and recordkeeping requirements, Travel and transportation expenses, Veterans.
For reasons set forth in the preamble, the Department of Veterans Affairs
38 U.S.C. 501, and as noted in specific sections.
(a) * * *
(1) Not a part of, or an employee of, VA; or
(2) If the provider is an employee of VA, is not acting within the scope of such employment while providing hospital care or medical services through the Veterans Choice Program.
Environmental Protection Agency (EPA).
Final rule.
The Environmental Protection Agency (EPA) is approving a state implementation plan (SIP) revision submitted by the Commonwealth of Pennsylvania (Pennsylvania). The revision demonstrates attainment of the 2008 lead national ambient air quality standards (NAAQS) in the Lower Beaver Valley nonattainment area (Lower Beaver Valley Area or Area). The attainment plan includes the base year emissions inventory, an analysis of reasonably available control technology (RACT), reasonably available control measures (RACM) and reasonable further progress (RFP), a modeling demonstration of attainment, and contingency measures for the Area. EPA is approving Pennsylvania's lead attainment plan for the Lower Beaver Valley Area as a revision to Pennsylvania's SIP in accordance with the requirements of the Clean Air Act (CAA).
This final rule is effective on May 25, 2016.
EPA has established a docket for this action under Docket ID Number EPA-R03-OAR-2015-0112. All documents in the docket are listed in the
Gerallyn Duke, (215) 814-2084, or by email at
On January 20, 2016 (81 FR 3078), EPA published a notice of proposed rulemaking (NPR) for the Commonwealth of Pennsylvania. In the NPR, EPA proposed approval of a revision to Pennsylvania's SIP for the purpose of demonstrating attainment of the 2008 lead NAAQS in the Lower Beaver Valley Area. The formal SIP revision was submitted by Pennsylvania on January 15, 2015.
On November 12, 2008 (73 FR 66964), EPA revised the lead NAAQS, lowering the level from 1.5 micrograms per cubic meter (μg/m
On November 22, 2010 (75 FR 71033), EPA designated Vanport and Potter Townships in Beaver County, Pennsylvania as the Lower Beaver Valley Area for its nonattainment status with respect to the 2008 lead NAAQS. On November 22, 2011 (76 FR 72097), EPA revised the Lower Beaver Valley Area boundary to include Center Township. The designation of the Lower Beaver Valley Area as nonattainment for the 2008 lead NAAQS triggered requirements under section 191(a) of the CAA, requiring Pennsylvania to submit a SIP revision with a plan for how the Area will attain the 2008 lead NAAQS, as expeditiously as practicable, but no later than December 31, 2015.
Section 179(a)(1) of the CAA establishes specific consequences if EPA finds that a state has failed to submit a SIP or, with regard to a submitted SIP, if EPA determines it is incomplete or if EPA disapproves it. Additionally, any of these findings also triggers an obligation for EPA to promulgate a federal implementation plan (FIP) if the state has not submitted, and EPA has not approved, the required SIP within 2 years of the finding pursuant to section 110(c) of the CAA. On February 25, 2014, the EPA issued a finding that Pennsylvania failed to make the required nonattainment SIP submission for the Lower Beaver Valley Area. 79 FR 10391. With this final approval of Pennsylvania's Lower Beaver Valley attainment plan SIP in accordance with section 172(c) of the CAA, EPA no longer has any obligation to issue a FIP for the Lower Beaver Valley Area in accordance with section 110(c) of the CAA.
On January 15, 2015, Pennsylvania through the Department of Environmental Protection (PADEP) submitted an attainment plan for the Lower Beaver Valley Area as a SIP revision which includes a base year emissions inventory, an attainment demonstration, an analysis of RACM and RACT, provisions for RFP, and contingency measures. The SIP revision also includes as attainment control measures certain provisions of a November 21, 2012 consent order and agreement (COA) (specifically including paragraphs 3, 5, and 6) between PADEP and Horsehead Corporation (Horsehead), the largest source of lead in the Area at the time of designations. Pennsylvania's attainment demonstration relied primarily on the emissions reductions achieved by the shutdown of the smelter equipment at Horsehead, as required by the COA. EPA's analysis of the submitted attainment plan includes a review of
EPA's approval of the attainment plan is based on the Agency's finding that the Area meets all applicable lead NAAQS attainment plan requirements under CAA sections 172, 191, and 192. Due to monitored ambient air quality violations in 2013 and 2014, the Area did not attain the lead NAAQS by the applicable attainment date of December 2015. However, closure of Horsehead in 2014 as required per the COA will facilitate attainment of the 2008 lead NAAQS by 2017. EPA is approving the attainment year emissions inventory submitted with the plan, as well as the RACM/RACT and RFP analyses, the attainment demonstration including modeling, and the contingency measures for the Lower Beaver Valley Area.
Other specific requirements of the SIP submittal attainment plan for the Lower Beaver Valley Area and the rationale for EPA's proposed action are explained in the NPR and its accompanying Technical Support Documents (TSDs) and will not be restated here. No public comments were received on the NPR.
EPA is approving the lead attainment plan for the Lower Beaver Valley Area as a revision to the Pennsylvania SIP, as submitted on January 15, 2015, including the attainment demonstration, base year emissions inventory, RACM/RACT and RFP analyses, contingency measures and paragraphs 3,5 and 6 of the COA between PADEP and Horsehead provided as attainment control measures. EPA has determined that the January 15, 2015 SIP revision meets the applicable requirements of the CAA. With EPA's final approval of Pennsylvania's Lower Beaver Valley Area attainment plan as a SIP revision, EPA no longer has any obligation to promulgate a FIP for the Area pursuant to sections 110(c) or 172(c) of the CAA.
Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:
• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• Does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and
• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 24, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action approving Pennsylvania's SIP revision containing the attainment plan for the 2008 lead NAAQS in the Lower Beaver Valley Area may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Lead.
40 CFR part 52 is amended as follows:
42 U.S.C. 7401
(e) * * *
(1) * * *
(aa) EPA approves as a revision to the Pennsylvania state implementation plan the 2010 base year emissions inventory for the Lower Beaver Valley, Pennsylvania nonattainment area for the 2008 lead NAAQS. This SIP revision was submitted by the Pennsylvania Department of Environmental Protection on January 15, 2015. This submittal includes the 2010 base year emissions inventory for all relevant sources in the Lower Beaver Valley nonattainment area for the pollutant lead.
(c) EPA approves the state implementation plan for the Lower Beaver Valley, Pennsylvania nonattainment area for the 2008 lead NAAQS. This SIP revision includes reasonably available control measures, reasonably available control technology, contingency measures, and an attainment demonstration submitted by the Pennsylvania Department of Environmental Protection on January 15, 2015.
Environmental Protection Agency (EPA).
Final rule.
The Environmental Protection Agency (EPA) is taking final action to approve a revision to the San Joaquin Valley Unified Air Pollution Control District (SJVUAPCD) portion of the California State Implementation Plan (SIP). This revision concerns emissions of volatile organic compounds (VOCs), oxides of nitrogen (NO
This rule will be effective on May 25, 2016.
The EPA has established docket number EPA-R09-OAR-2015-0751 for this action. Generally, documents in the docket for this action are available electronically at
Nicole Law, EPA Region IX, (415) 947-4126,
Throughout this document, “we,” “us” and “our” refer to the EPA.
On December 2, 2015 (80 FR 75442), the EPA proposed to approve the following rule into the California SIP.
We proposed to approve this rule because we determined that it complied with the relevant CAA requirements. Our proposed action contains more information on the rule and our evaluation.
The EPA's proposed action provided a 30-day public comment period. Because one document in the docket for the proposal was not listed in
No comments were submitted. Therefore, as authorized in section 110(k)(3) of the Act, the EPA is fully approving this rule into the California SIP.
In this rule, the EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the SJVUAPCD rules described in the amendments to 40 CFR part 52 set forth below. The EPA has made, and will continue to make, these documents available electronically through
Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, the EPA's role is to approve state choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:
• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
• does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and
• does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 24, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements (see section 307(b)(2)).
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.
Part 52, Chapter I, Title 40 of the Code of Federal Regulations is amended as follows:
42 U.S.C. 7401
(c) * * *
(350) * * *
(i) * * *
(C) * * *
(
(441) * * *
(i) * * *
(D) * * *
(
Environmental Protection Agency (EPA).
Final rule.
On December 10, 2015, the State of Arkansas, through the Arkansas Department of Environment Quality (ADEQ), submitted a request for the Environmental Protection Agency (EPA) to redesignate the portion of Arkansas that is within the Memphis, Tennessee-Mississippi-Arkansas (Memphis, TN-MS-AR) 2008 8-hour ozone nonattainment area (hereafter referred to as the “Memphis, TN-MS-AR Area” or “Area”) and to approve a State Implementation Plan (SIP) revision containing a maintenance plan for the Area. EPA has determined that the Memphis, TN-MS-AR Area is attaining the 2008 8-hour ozone national ambient air quality standards (NAAQS); is approving the State's plan for maintaining attainment of the 2008 8-hour ozone NAAQS in the Area,
This rule is effective on May 25, 2016.
The EPA has established a docket for this action under Docket ID No. EPA-R06-OAR-2015-0852. All documents in the docket are listed on the
Jeffrey Riley, 214-665-8542,
Throughout this document “we,” “us,” and “our” means the EPA.
The background for this action is discussed in detail in our February 10, 2016 proposal (81 FR 7046). In that document, we proposed to determine that the Memphis, TN-MS-AR Area is continuing to attain the 2008 8-hour ozone NAAQS; to approve and incorporate into the Arkansas SIP the State's plan for maintaining attainment of the 2008 8-hour ozone standard in the Area, including the 2012 and 2027 MVEBs for NO
Approval of Arkansas' redesignation request changes the legal designation of Crittenden County in the Arkansas portion of the Memphis, TN-MS-AR Area, found at 40 CFR 81.325, from nonattainment to attainment for the 2008 8-hour ozone NAAQS. Approval of Arkansas' associated SIP revision also incorporates a plan into the SIP for maintaining the 2008 8-hour ozone NAAQS in the Arkansas portion of the Memphis, TN-MS-AR Area through 2027. The maintenance plan establishes NO
EPA is taking three separate final actions regarding the Memphis, TN-MS-AR Area's redesignation to attainment and maintenance of the 2008 8-hour ozone NAAQS. First, EPA is determining that the Memphis, TN-MS-AR Area is continuing to attain the 2008 8-hour ozone NAAQS.
Second, EPA is approving and incorporating the maintenance plan (including the Clarification Letter) for the Memphis, TN-MS-AR Area, including the NO
Third, EPA is determining that Arkansas has met the criteria under CAA section 107(d)(3)(E) for the Memphis, TN-MS-AR Area for redesignation from nonattainment to attainment for the 2008 8-hour ozone NAAQS. On this basis, EPA is approving Arkansas' redesignation request for the 2008 8-hour ozone NAAQS for the Arkansas portion of the Memphis, TN-MS-AR Area. As mentioned above, approval of the redesignation request changes the official designation of Crittenden County in the Arkansas portion of the Memphis, TN-MS-AR Area for the 2008 8-hour ozone NAAQS from nonattainment to attainment, as found at 40 CFR part 81.
EPA is also notifying the public that EPA finds the newly-established NO
Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable
• Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
• Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Public Law 104-4);
• Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• Is not subject to requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the Clean Air Act; and
• Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).
In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
The Congressional Review Act, 5 U.S.C. 801
Under section 307(b)(1) of the Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 24, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)
Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Ozone, Reporting and recordkeeping requirements, Volatile organic compounds.
Environmental protection, Air pollution control.
40 CFR part 52 is amended as follows:
42 U.S.C. 7401
(e) * * *
42 U.S.C. 7401
Federal Emergency Management Agency, DHS.
Final rule.
This rule identifies communities where the sale of flood insurance has been authorized under the National Flood Insurance Program (NFIP) that are scheduled for suspension on the effective dates listed within this rule because of noncompliance with the floodplain management requirements of the program. If the Federal Emergency Management Agency (FEMA) receives documentation that the community has adopted the required floodplain management measures prior to the effective suspension date given in this rule, the suspension will not occur and a notice of this will be provided by publication in the
The effective date of each community's scheduled suspension is the third date (“Susp.”) listed in the third column of the following tables.
If you want to determine whether a particular community was suspended on the suspension date or for further information, contact Patricia Suber, Federal Insurance and Mitigation Administration, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472, (202) 646-4149.
The NFIP enables property owners to purchase Federal flood insurance that is not otherwise generally available from private insurers. In return, communities agree to adopt and administer local floodplain management measures aimed at protecting lives and new construction from future flooding. Section 1315 of the National Flood Insurance Act of 1968, as amended, 42 U.S.C. 4022, prohibits the sale of NFIP flood insurance unless an appropriate public body adopts adequate floodplain management measures with effective enforcement measures. The communities listed in this document no longer meet that statutory requirement for compliance with program regulations, 44 CFR part 59. Accordingly, the communities will be suspended on the effective date in the third column. As of that date, flood insurance will no longer be available in the community. We recognize that some of these communities may adopt and submit the required documentation of legally enforceable floodplain management measures after this rule is published but prior to the actual suspension date. These communities will not be suspended and will continue to be eligible for the sale of NFIP flood insurance. A notice withdrawing the suspension of such communities will be published in the
In addition, FEMA publishes a Flood Insurance Rate Map (FIRM) that identifies the Special Flood Hazard Areas (SFHAs) in these communities. The date of the FIRM, if one has been published, is indicated in the fourth column of the table. No direct Federal financial assistance (except assistance pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act not in connection with a flood) may be provided for construction or acquisition of buildings in identified SFHAs for communities not participating in the NFIP and identified for more than a year on FEMA's initial FIRM for the community as having flood-prone areas (section 202(a) of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4106(a), as amended). This prohibition against certain types of Federal assistance becomes effective for the communities listed on the date shown in the last column. The Administrator finds that notice and public comment procedures under 5 U.S.C. 553(b), are impracticable and unnecessary because communities listed in this final rule have been adequately notified.
Each community receives 6-month, 90-day, and 30-day notification letters addressed to the Chief Executive Officer stating that the community will be suspended unless the required floodplain management measures are met prior to the effective suspension date. Since these notifications were made, this final rule may take effect within less than 30 days.
Flood insurance, Floodplains.
Accordingly, 44 CFR part 64 is amended as follows:
42 U.S.C. 4001
In rule document appearing on pages 17615-17617 in the issue of Wednesday, March 30, 2016, make the following correction:
The table appearing on pages 17616-17617 should read as follows:
Federal Emergency Management Agency, DHS.
Final rule.
Base (1% annual-chance) Flood Elevations (BFEs) and modified BFEs are made final for the communities listed below. The BFEs and modified BFEs are the basis for the floodplain management measures that each community is required either to adopt or to show evidence of being already in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
The date of issuance of the Flood Insurance Rate Map (FIRM) showing BFEs and modified BFEs for each community. This date may be obtained by contacting the office where the maps are available for inspection as indicated in the table below.
The final BFEs for each community are available for inspection at the office of the Chief Executive Officer of each community. The respective addresses are listed in the table below.
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the modified BFEs for each community listed. These modified elevations have been published in newspapers of local circulation and ninety (90) days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
This final rule is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR part 67. FEMA has developed criteria for floodplain management in floodprone areas in accordance with 44 CFR part 60.
Interested lessees and owners of real property are encouraged to review the proof Flood Insurance Study and FIRM available at the address cited below for each community.
The BFEs and modified BFEs are made final in the communities listed below. Elevations at selected locations in each community are shown.
Administrative practice and procedure, Flood insurance, Reporting and recordkeeping requirements.
Accordingly, 44 CFR part 67 is amended as follows:
42 U.S.C. 4001
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Final rule.
NMFS issues regulations to implement management measures described in a framework action to the Fishery Management Plan for the Reef Fish Resources of the Gulf of Mexico (FMP), as prepared by the Gulf of Mexico Fishery Management Council (Council). This action revises the recreational closed season for gag and the recreational minimum size limits for gag and black grouper in the Gulf of Mexico (Gulf) exclusive economic zone. The purpose of this final rule is to optimize recreational opportunities to harvest gag and to address inconsistencies in the recreational minimum size limits for gag and black grouper in the Gulf and South Atlantic.
This final rule is effective May 25, 2016.
Electronic copies of the framework action, which includes an environmental assessment, a regulatory impact review, and a Regulatory Flexibility Act (RFA) analysis may be obtained from the Southeast Regional Office Web site at
Richard Malinowski, Southeast Regional Office, NMFS, telephone: 727-824-5305, email:
The Gulf reef fish fishery, which includes gag and black grouper, 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 March 3, 2016, NMFS published a proposed rule for the framework action and requested public comment (81 FR 11166). The proposed rule and Amendment 35 outline the rationale for the actions contained in this final rule. A summary of the actions implemented by the framework action and this final rule is provided below.
The 2014 Southeast Data, Assessment and Review (SEDAR 33) benchmark stock assessment indicates that the Gulf gag stock is not overfished or undergoing overfishing. However, as described in the framework action, the Council's Reef Fish Advisory Panel, the Council's Science and Statistical Committee (SSC), and the public all suggested that the Council use caution when setting the gag annual catch limits (ACL) and annual catch targets (ACT) because SEDAR 33 resulted in a large increase in the overfishing limit compared to the previous gag assessment. Therefore, the Council decided not to modify the Gulf gag ACL or ACT in this framework action.
The 2010 SEDAR 19 benchmark assessment for black grouper found that the Gulf black grouper stock was neither overfished nor undergoing overfishing.
This final rule revises the recreational closed season for gag and the recreational minimum size limits for gag and black grouper in the Gulf.
The current closed season for the gag recreational sector is January 1 through June 30 and December 3 through December 31, annually. This closed season was established in Amendment
This final rule revises the gag recreational closed season to be from January 1 to May 31, annually. This revised closed season is expected to reduce the amount of dead discards of gag that occur during the Gulf's recreational season for red snapper that begins on June 1, annually, and to extend the gag recreational fishing season beyond the current December closure date to provide the opportunity for the recreational sector to harvest the recreational ACL.
The current gag and black grouper recreational minimum size limits in Gulf Federal waters are both set at 22 inches (55.9 cm), total length (TL). The current gag and black grouper minimum size limit in South Atlantic Federal waters is 24 inches (61.0 cm), TL, for both species and for both the commercial and recreational sectors. For the state of Florida, in state waters off Monroe County in the Gulf, the recreational minimum size limit for gag and black grouper is 24 inches (61.0 cm), TL. This final rule increases the recreational minimum size limit in Gulf Federal waters for both species to 24 inches (61.0 cm), TL, to be consistent with the Federal waters of the South Atlantic and state waters off Monroe County, Florida. The Council decided that the benefits of having a size limit for these species that is consistent with both the South Atlantic and the state size limits for the waters off Monroe County, Florida, will outweigh any impacts of increased discard rates for these species. Furthermore, gag are sometimes misidentified as black grouper and having the same recreational minimum size limit for gag and black grouper may assist the public in complying with the applicable regulations for gag and black grouper. Additionally, increasing the recreational minimum size limit for these species is expected to provide the opportunity for more gag and black grouper to become sexually mature and spawn.
A total of 16 comments were received on the framework action and the proposed rule. Ten of the comments supported the actions in the rule, one comment was against the actions in the rule, and five comments were not related to the actions in the framework action or the proposed rule. Specific comments related to the actions in the framework action and the proposed rule as well as NMFS' respective responses, are summarized below.
The Regional Administrator, Southeast Region, NMFS, has determined that this final rule is necessary for the conservation and management of Gulf gag and black grouper and is consistent with the framework action, the FMP, the Magnuson-Stevens Act, and other applicable law.
This final rule has been determined to be not significant for purposes of Executive Order 12866.
The Magnuson-Stevens Act provides the statutory basis for this rule. No duplicative, overlapping, or conflicting Federal rules have been identified. In addition, no new reporting, recordkeeping, or other compliance requirements are introduced by this final rule.
The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration during the proposed rule stage that this rule would not have a significant economic impact on a substantial number of small entities. The factual basis for this determination was published in the proposed rule and is not repeated here. No comments were received regarding the certification and NMFS has not received any new information that would affect its determination. As a result, a final regulatory flexibility analysis was not required and none was prepared.
Black grouper, Fisheries, Fishing, Gag, Gulf, Recreational, Reef fish, Size limits.
For the reasons set out in the preamble, 50 CFR part 622 is amended as follows:
16 U.S.C. 1801
(e)
(b) * * *
(1)
(ii) For a person subject to the bag limit specified in § 622.38(b)(2)—24 inches (61.0 cm), TL.
(5) * * *
(ii) For a person subject to the bag limit specified in § 622.38(b)(2)—24 inches (61.0 cm), TL.
Food and Drug Administration, HHS.
Notification; extension of comment period.
The Food and Drug Administration (FDA or we) is extending the comment period for the document entitled “Refurbishing, Reconditioning, Rebuilding, Remarketing, Remanufacturing, and Servicing of Medical Devices Performed by Third-Party Entities and Original Equipment Manufacturers” that appeared in the
FDA is extending the comment period on the document published March 4, 2016 (81 FR 11477). Submit either electronic or written comments by June 3, 2016.
You may submit comments as follows:
Submit electronic comments in the following way:
•
• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
•
• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Valerie Flournoy, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Silver Spring, MD 20993-0002, 301-796-5495.
In the
The Agency has received requests for a 30-day extension of the comment period for the document. Each request conveyed concern that the current 60-day comment period does not allow sufficient time to develop meaningful or thoughtful response to the document on “Refurbishing, Reconditioning, Rebuilding, Remarketing, Remanufacturing, and Servicing of Medical Devices Performed by Third-Party Entities and Original Equipment Manufacturers.”
FDA has considered the requests and is extending the comment period for the document on “Refurbishing, Reconditioning, Rebuilding, Remarketing, Remanufacturing, and Servicing of Medical Devices Performed by Third-Party Entities and Original Equipment Manufacturers” for 30 days, until June 3, 2016. The Agency believes that a 30-day extension allows adequate time for interested persons to submit comments without significantly delaying future workshop on these important issues.
Office of the Director of National Intelligence.
Proposed rule.
The Office of the Director of National Intelligence (ODNI) is publishing this proposed rule pursuant to Executive Order 13526, relating to classified national security information. It provides procedures for members of the public to request from ODNI a Mandatory Declassification Review (MDR) of information classified under the provisions of Executive Order 13526 or predecessor orders such that the agency may retrieve it with reasonable effort. This rule also informs requesters where to send requests for an MDR.
Submit comments on or before May 25, 2016.
You may submit comments by any of the following methods: By mail to the Office of the Director of National Intelligence, Director of the Information Management Division, Washington, DC 20511, by facsimile at (703) 874-8910, or by email at
Jennifer L. Hudson, 703-874-8085.
It is the policy of the ODNI to act in matters relating to national security information in accordance with Executive Order 13526 and directives issued thereunder by the Information Security Oversight Office (ISOO). The purpose of this rule is to assist in implementing specific sections of Executive Order 13526 concerning the Mandatory Declassification Review (MDR).
This proposed rule is not a significant regulatory action for the purposes of Executive Order 12866. This rule is not a major rule as defined in 5 U.S.C. Chapter 8, Congressional Review of Agency Rulemaking. As required by the Regulatory Flexibility Act, we certify that this proposed rule will not have a significant impact on a substantial number of small entities because it applies only to Federal agencies.
Declassification, Information, Intelligence, National security information.
50 U.S.C. 3001; E.O. 13526, 75 FR 707, 3 CFR, 2009 Comp, p. 298.
(a)
(b)
For purposes of this part:
For general information on the regulation in this part or to submit a request for a Mandatory Declassification Review (MDR), please direct your communication by mail to the Office of the Director of National Intelligence, Director of the Information Management Division, Washington, DC 20511; by facsimile to (703) 874-8910; or by email to
The ODNI welcomes suggestions for improving the administration of our MDR program in accordance with Executive Order 13526. Suggestions should identify the specific purpose and the items for consideration. The ODNI will respond to all communications and take such actions as determined feasible and appropriate.
Address all communications to the point of contact as specified in § 1704.3. Clearly describe, list, or label said communication as an MDR Request.
MDR requests will not be accepted from a foreign government entity or any representative thereof. MDR requests will not be accepted for documents required to be submitted for pre-publication review or other administrative process pursuant to an approved nondisclosure agreement; for information that is the subject of pending litigation; nor for any document or material containing information contained within an operational file exempted from search and review, publication, and disclosure under the FOIA. If the ODNI has reviewed the requested information for declassification within the past two years, the ODNI will not conduct another review, but the D/IMD will notify the requester of this fact and the prior review decision. Requests will not be accepted from requesters who have outstanding fees for MDR or Freedom of Information Act (FOIA) requests with the ODNI or another federal agency.
An MDR request shall describe the document or material containing the information with sufficient specificity to enable the ODNI to locate it with a reasonable amount of effort.
(a)
(b)
(1) As a matter of administrative discretion, the interest of the United States Government would be served, or
(2) It is in the public interest to provide responsive records because the disclosure is likely to contribute significantly to the public understanding of the operations or activities of the United States Government and is not primarily in the commercial interest of the requester.
(c)
(d)
(e)
(2)
(3)
(f)
(g)
(a)
(b)
(c)
(d)
(a)
(1)
(2)
(3)
(b)
Environmental Protection Agency (EPA).
Notice of filing of petitions and request for comment.
This document announces the Agency's receipt of several initial filings of pesticide petitions requesting the establishment or modification of regulations for residues of pesticide chemicals in or on various commodities.
Comments must be received on or before May 25, 2016.
Submit your comments, identified by docket identification (ID) number and the pesticide petition number (PP) of interest as shown in the
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•
•
Robert McNally, Biopesticides and Pollution Prevention Division (BPPD) (7511P),
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).
If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under
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3.
EPA is announcing its receipt of several pesticide petitions filed under section 408 of the Federal Food, Drug, and Cosmetic Act (FFDCA), 21 U.S.C. 346a, requesting the establishment or modification of regulations in 40 CFR part 174 or part 180 for residues of pesticide chemicals in or on various food commodities. The Agency is taking public comment on the requests before responding to the petitioners. EPA is not proposing any particular action at this time. EPA has determined that the pesticide petitions described in this document contain the data or information prescribed in FFDCA section 408(d)(2), 21 U.S.C. 346a(d)(2); however, EPA has not fully evaluated the sufficiency of the submitted data at this time or whether the data support granting of the pesticide petitions. After considering the public comments, EPA intends to evaluate whether and what action may be warranted. Additional data may be needed before EPA can make a final determination on these pesticide petitions.
Pursuant to 40 CFR 180.7(f), a summary of each of the petitions that are the subject of this document, prepared by the petitioner, is included in a docket EPA has created for each rulemaking. The docket for each of the petitions is available at
As specified in FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), EPA is publishing notice of the petitions so that the public has an opportunity to comment on these requests for the establishment or modification of regulations for residues of pesticides in or on food commodities. Further information on the petitions may be obtained through the petition summary referenced in this unit.
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21 U.S.C. 346
Centers for Disease Control and Prevention, HHS.
Denial of petition for addition of a health condition.
On January 25, 2016, the Administrator of the World Trade Center (WTC) Health Program received a petition (Petition 011) to add “autoimmune disease, lupus, and rheumatoid arthritis” to the List of WTC-Related Health Conditions (List). Upon reviewing the information provided by the petitioner, the Administrator has determined that Petition 011 is not substantially different from Petitions 007, 008, and 009, which also requested the addition of autoimmune diseases. The Administrator recently published responses to Petitions 007, 008, and 009 in the
The Administrator of the WTC Health Program is denying this petition for the addition of a health condition as of April 25, 2016.
Rachel Weiss, Program Analyst, 1090 Tusculum Avenue, MS: C-46, Cincinnati, OH 45226; telephone (855) 818-1629 (this is a toll-free number); email
Title I of the James Zadroga 9/11 Health and Compensation Act of 2010 (Zadroga Act), Public Law 111-347, as amended by Public Law 114-113, added Title XXXIII to the Public Health Service Act (PHS Act)
All references to the Administrator of the WTC Health Program (Administrator) in this notice mean the Director of the National Institute for Occupational Safety and Health (NIOSH) or his or her designee.
Pursuant to section 3312(a)(6)(B) of the PHS Act, interested parties may petition the Administrator to add a health condition to the List in 42 CFR 88.1. After receipt of a petition to add a condition to the List, the Administrator must take one of the following four actions described in section 3312(a)(6)(B) and 42 CFR 88.17: 1. Request a recommendation of the STAC; 2. publish a proposed rule in the
The Secretary, HHS, or her designee, the Director, Centers for Disease Control and Prevention (CDC) and Administrator, Agency for Toxic Substances and Disease Registry (ATSDR), authorized the undersigned, the Administrator of the WTC Health Program, to sign and submit the document to the Office of the Federal Register for publication as an official document of the WTC Health Program. Thomas R. Frieden, M.D., M.P.H., Director, CDC, and Administrator, ATSDR, approved this document for publication on April 18, 2016.
On January 25, 2016, the Administrator received a petition from a responder in the WTC Health Program to add autoimmune disease, lupus, and rheumatoid arthritis to the List (Petition 011).
The current petition, Petition 011, presented eight references to support the request to add “autoimmune disease, lupus, and rheumatoid arthritis” to the List. Pursuant to WTC Health Program policy, the medical basis for a potential addition to the List may be demonstrated by reference to a peer-reviewed, published, epidemiologic study about the health condition among 9/11-exposed populations or to clinical case reports of health conditions in WTC responders or survivors.
In addition to a review of the studies presented in Petition 011, the WTC Health Program Associate Director for Science (ADS) conducted a review of the scientific literature to determine if the available scientific information has the potential to provide a basis for a decision on whether to add the condition to the List. The ADS previously conducted such a literature review for autoimmune disorders in response to Petition 007.
In accordance with WTC Health Program policy, the ADS reviewed the eight references in Petition 011 and the six studies identified in the literature review for relevance, and then relevant studies were further reviewed for quality, and quantity.
Petition references 1, 2, and 3 are the Web sites of the S.L.E. Lupus Foundation,
Petition reference 4 is the Fire Department of New York (FDNY) EMS Retirees Association's Web page on WTC Monitoring and Treatment Centers, which mentions lupus and rheumatoid arthritis and is relevant to the 9/11 population, but does not identify a published, peer-reviewed epidemiologic study or clinical case report. This reference is not considered relevant under the policy for adding non-cancers to the List because it is not a published, peer-reviewed epidemiologic study of autoimmune disease, lupus, and/or rheumatoid arthritis in 9/11-exposed populations and, therefore, it was not further reviewed.
Petition reference 5 is a 2011
Petition reference 7 is an abstract for a NIOSH-funded study titled, “Autoimmune Disease among WTCHR [WTC Health Registry] Registrants: Survey Design and Preliminary Response Rates.”
Petition reference 8 (unnumbered in the petition) is two excerpts from an HHS publication entitled, “The Future Directions of Lupus Research.”
The remaining petition reference, reference 6, is a 2015 study by Webber
The ADS identified six references in the literature review performed pursuant to the policy for adding non-cancer health conditions to the List. Four were found to be not relevant because they were not epidemiologic studies, therefore they were not further assessed. One study was the 2015 Webber
The final study identified in the literature review was a 2016 epidemiologic study by Webber
In the 2016 study, Webber
The 2016 Webber study then looked to the REP comparison group to provide age- and sex-specific incidence rates during a similar time period as reviewed for the FDNY cases. Incidence rates for the REP comparison group were only available, however, for a limited subset of five autoimmune conditions: Rheumatoid arthritis, psoriatic arthritis, ankylosing spondylitis, SLE, and scleroderma. By applying the REP incidence rates to the FDNY cohort, the study authors were able to generate age-specific expected numbers of cases for the FDNY cohort. The observed incidence rates in the FDNY cohort were then compared with the expected numbers of cases for the FDNY cohort derived from the REP rates. Standardized ratios, which are the ratios of the observed number of cases in the FDNY cohort to the expected number of cases (based on the REP rates) were then calculated. Overall, FDNY rates for the five types of autoimmune disease compared were not significantly different from expected rates (SIR, 0.97; 95% CI, 0.77-1.21). Only SLE had a standardized incidence ratio that was statistically significantly greater among the entire FDNY cohort. Other ratios were either reduced or not statistically significant.
Limitations similar to those found in the 2015 Webber study, discussed above, were seen in the 2016 Webber study, including the lack of information on potential confounders such as family history of autoimmune disease and both work-related and recreational non-9/11-related exposures, and poor generalizability to other 9/11-exposed groups. The 2016 Webber study did not include new or additional information or controls that would avoid or mitigate the limitations found in the 2015 study. Consistent with the assessment of Petition 007,
The Administrator has established a policy for evaluating whether to propose the addition of non-cancer health conditions to the List of WTC-Related Health Conditions.
In reviewing the 2016 Webber study for potential support for Petition 011, the ADS concluded that similar inadequacies existed for the 2016 study as those seen in the 2015 Webber study. Taken together, the two Webber studies, while meeting the relevance threshold of being published, peer-reviewed epidemiologic studies of autoimmune disease, including lupus and rheumatoid arthritis, in 9/11-exposed populations, were found to exhibit significant limitations and were thus insufficient to provide a potential basis for a decision on whether to propose adding the requested health conditions to the List.
Accordingly, with regard to Petition 011, the Administrator has determined that insufficient evidence exists to take further action at this time, including either proposing the addition of autoimmune diseases to the List (pursuant to PHS Act, sec. 3312(a)(6)(B)(ii) and 42 CFR 88.17(a)(2)(ii)) or publishing a determination not to publish a proposed rule in the
For the reasons discussed above, the request made in Petition 011 to add autoimmune disease, lupus, and rheumatoid arthritis to the List of WTC-Related Health Conditions is denied.
The Administrator will continue to monitor the scientific literature for publication of the results of the ongoing WTC Health Registry study discussed above (reference 7 in the petition) and any other studies that address autoimmune diseases among 9/11-exposed populations.
Federal Communications Commission.
Petition for declaratory ruling; request for comments.
This document seeks comment on a petition for declaratory ruling filed by the National Cable & Telecommunications Association and American Cable Association seeking a declaratory ruling clarifying the “written information” requirement of section 76.1602(b) of the Commission's rules. Specifically, NCTA and ACA “seek a ruling that electronic dissemination by email to subscribers for whom a cable operator has a confirmed email address, by the provision of appropriately-noticed links to Web sites, or by other electronic measures reasonably calculated to reach
Comments are due on or before May 26, 2016; reply comments are due on or before June 10, 2016.
You may submit comments, identified by MB Docket No. 16-126, by any of the following methods:
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• All hand-delivered or messenger-delivered paper filings for the Commission's Secretary must be delivered to FCC Headquarters at 445 12th St. SW., Room TW-A325, Washington, DC 20554. The filing hours are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes and boxes must be disposed of before entering the building.
• Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743.
• U.S. Postal Service first-class, Express, and Priority mail must be addressed to 445 12th Street SW., Washington, DC 20554.
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For additional information on this proceeding, contact Katie Costello of the Policy Division, Media Bureau at (202) 418-2233 or
This is a summary of the Public Notice dated April 14, 2016, DA 16-407,
On March 7, 2016, National Cable & Telecommunications Association (“NCTA”) and the American Cable Association (“ACA”) jointly filed a Petition for Declaratory Ruling (“Petition”) in which it seeks clarification of the “written information” requirement of Section 76.1602(b) of the Commission's rules. Specifically, NCTA and ACA “seek a ruling that electronic dissemination by email to subscribers for whom a cable operator has a confirmed email address, by the provision of appropriately-noticed links to Web sites, or by other electronic measures reasonably calculated to reach individual customers, satisfies the requirement if the information is also available in print upon customer request.” The Commission issue this Public Notice pursuant to section 1.2 of the Commission's rules to seek comment on NCTA and ACA's Petition. The Petition is available electronically through the Commission's ECFS under MB Docket No. 16-126, which may be accessed on the Commission's Internet Web site at
Office of Advocacy and Outreach, USDA.
Notice and request for comments.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), this notice announces the Office of Advocacy and Outreach's (OAO) intention to request approval from the Office of Management and Budget (OMB) for the reinstatement of a previously approved data collection for the U.S. Department of Agriculture (USDA) 1994 Tribal Scholars Program.
Comments on this notice must be received by June 24, 2016 to be assured of consideration.
The USDA 1994 Tribal Scholars Program, within the Office of the Assistant Secretary for Administration, Office of Advocacy and Outreach, is an annual, joint human capital initiative between USDA and the Nation's 1994 Land-Grant Institutions, also known as 1994 Tribal Colleges and Universities (1994 TCUs). This program offers a combination of paid work experience with a USDA sponsoring agency through an appointment under the Fellowship Experience Program (FEP). FEP will permit the recruitment and selection of exceptional students majoring in agriculture related fields of study at USDA partner colleges and universities. Under the FEP, students will fill Excepted Service positions, receive mentoring, and be provided developmental assignments. These temporary appointments will be made using the Schedule A in 5 CFR 213.3102(r) and may not exceed 4 years based on defined criteria.
When students graduate, they will be eligible to compete for job opportunities at USDA. Additionally, the experience the students gain via classroom instruction in their respective degree paths, along with their USDA work experience, will make them strong candidates for opportunities in agriculture and agri-business related fields. The USDA 1994 Tribal Scholars Program is designed to integrate classroom study into a degreed college or university program such as agriculture and natural resources, which prepares the student for competing for positions in the sponsoring agency's future workforce and with paid tuition, fees, books, use of a laptop computer, and leadership training. The program is conducted in accordance with a planned schedule and a working agreement between USDA agencies and the student.
The USDA 1994 Tribal Scholars Program will offer scholarships and internships to U.S. citizens for a period of up to 4 years. The eligibility standards are:
1. Must be at least 16 years old.
2. Must be able to complete required occupation-related work experience (640 hours) prior to or concurrently with the completion of course requirements for the degree.
3. Must be a United States citizen or national (resident of American Samoa or Swains Island). If you are not a citizen, you may participate if you are legally admitted to the United States as a permanent resident, and are able to meet United States citizenship requirements prior to completion of your degree.
4. Must be in good academic standing. Cannot be on academic probation. Must furnish course registration information at the start of each school term; must provide verification of academic status at the end of each academic term (grade report or transcript); must meet academic standards as set forth by the school they are attending; maintain satisfactory progress in completing academic requirements; and demonstrate satisfactory performance and conduct.
5. If selected, students must sign USDA Fellowship agreements.
6. Must be enrolled in, accepted, or plan to seek a Bachelor's or Associate's degree in an accredited 1994 Tribal Land-Grant College or University as demonstrated by a declaration of a major course of study.
7. Carry at a minimum, a half-time course load as defined by the institution.
8. Be enrolled in an academic major related to the occupation being considered.
If selected, each student must furnish course registration at the start of each school term, provide verification of academic status at the end of each academic term (grade report or transcript), meet academic standards as set forth by the school they are attending, maintain satisfactory progress in completing academic requirements, and demonstrate satisfactory performance and conduct.
Comments are invited on: (1) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency's estimate of the burden of the proposed collection of information including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology. Comments may be sent to Lawrence Shorty, Program Director, USDA 1994 Program, Office of Advocacy and Outreach, 1400 Independence Avenue SW., Mail Stop 0601, Washington, DC 20250.
All comments received will be available for public inspection during regular business hours at the same address.
All responses to this notice will be summarized and included in the request for OMB approval. All comments will become a matter of public record.
Office of the Deputy Under Secretary for Food Safety, USDA.
Notice of public meeting and request for comments.
The Office of the Deputy Under Secretary for Food Safety, U.S. Department of Agriculture (USDA), is sponsoring a public meeting on June 10, 2016. The objective of the public meeting is to provide information and receive public comments on agenda items and draft United States (U.S.) positions to be discussed at the 39th Session of the Codex Alimentarius Commission (CAC) taking place in Rome, Italy, June 27-July 1, 2016. The Deputy Under Secretary for Food Safety recognizes the importance of providing interested parties the opportunity to obtain background information on the 39th Session of the CAC and to address items on the agenda.
The public meeting is scheduled for Friday, June 10, 2016, from 1:00 p.m.-4:00 p.m.
The public meeting will take place at the Jamie L. Whitten Building, United States Department of Agriculture (USDA), 1400 Independence Avenue SW., Room 107-A, Washington, DC 20250. Documents related to the 39th Session of the CAC will be accessible via the Internet at the following address:
The U.S. Delegate to the 39th Session of the CAC invites U.S. interested parties to submit their comments electronically to the following email address:
The participant code will be posted on the Web page below:
Barbara McNiff, U.S. Codex Office, 1400 Independence Avenue SW., Room 4861, Washington, DC 20250, Telephone: (202) 690-4719, Fax: (202)720-3157, Email:
Jasmine Curtis, U.S. Codex Office, 1400 Independence Avenue SW., Room 4865, Washington, DC 20250, Telephone: (202) 205-7760, Fax: (202) 720-3157, Email:
The CAC was established in 1963 by two United Nations organizations, the Food and Agriculture Organization (FAO) and the World Health Organization (WHO). Through adoption of food standards, codes of practice, and other guidelines developed by its committees, and by promoting their adoption and implementation by governments, the CAC seeks to protect the health of consumers and ensure fair practices in the food trade; promotes coordination of all food standards work undertaken by international governmental and non-governmental organizations; determines priorities and initiates and guides the preparation of draft standards through and with the aid of appropriate organizations; finalizes standards elaborated and publishes them in a
The following items on the Agenda for the 39th Session of the CAC will be discussed during the public meeting:
Each issue listed will be fully described in documents distributed, or to be distributed, by the Secretariat before the Meeting. Members of the public may access or request copies of these documents (see
At the June 10, 2016, public meeting, draft U.S. positions on the agenda items will be described and discussed, and attendees will have the opportunity to pose questions and offer comments. Written comments may be offered at the meeting or sent to the U.S. Delegate for the 39th Session of the CAC (see
Public awareness of all segments of rulemaking and policy development is important. Consequently, FSIS will announce this
FSIS also will make copies of this publication available through the FSIS Constituent Update, which is used to provide information regarding FSIS policies, procedures, regulations,
No agency, officer, or employee of the USDA shall, on the grounds of race, color, national origin, religion, sex, gender identity, sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, or political beliefs, exclude from participation in, deny the benefits of, or subject to discrimination any person in the United States under any program or activity conducted by the USDA.
To file a complaint of discrimination, complete the USDA Program Discrimination Complaint Form, which may be accessed online at
Send your completed complaint form or letter to USDA by mail, fax, or email:
Persons with disabilities who require alternative means for communication (Braille, large print, audiotape, etc.), should contact USDA's TARGET Center at (202) 720-2600 (voice and TDD).
Food and Nutrition Service (FNS), USDA.
Notice.
In accordance with the Paperwork Reduction Act of 1995, this notice invites the general public and other public agencies to comment on this proposed new information collection.
Written comments must be received on or before June 24, 2016.
Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions that were used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on those who are to respond, including use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
All written comments will be open for public inspection at the office of the Food and Nutrition Service during regular business hours (8:30 a.m. to 5 p.m. Monday through Friday) at 3101
All responses to this notice will be summarized and included in the request for Office of Management and Budget approval. All comments will be a matter of public record.
Requests for additional information or copies of this information collection should be directed to Rosemarie Downer at 703-305-2129.
This study will examine policies, waivers, administrative practices, workflow, and processes associated with the APT rates of all 50 States and the District of Columbia. The primary purpose of this study is to determine best practices for facilitating high APT rates, and to identify State policy and procedural practices that hinder and facilitate high APT rates.
The study team will first review available State policy documents, procedure manuals, and administrative data. If these resources are not available from accessible sources, the study team will request these resources from SNAP offices/agencies. Following this review, the study team will collect quantitative and qualitative data via an online survey from the 50 States and the District of Columbia. The total annual burden for gathering documents, manuals, and administrative data and completing the survey is an annual total of 478.28 burden hours (468.49 for respondents and 9.8 hours for non-respondents) and 418 total annual responses (296 for respondents and 122 for non-respondents).
See the table below for estimated total annual burden for each type of respondent:
Forest Service, USDA.
Notice of meeting.
The Siuslaw Resource Advisory Committee (RAC) will meet in Corvallis, Oregon. The committee is authorized under the Secure Rural Schools and Community Self-Determination Act (the Act) and operates in compliance with the Federal Advisory Committee Act. The purpose of the committee is to improve collaborative relationships and to provide advice and recommendations to the Forest Service concerning projects and funding consistent with Title II of the Act. RAC information can be found at the following Web site:
The meeting will be held on June 3, 2016, from 9:00 a.m. to 5:00 p.m.
All RAC meetings are subject to cancellation. For status of meeting prior to attendance, please contact the person listed under
The meeting will be held at the Corvallis Forestry Sciences Lab and Siuslaw National Forest Supervisor's Office, 3200 SW. Jefferson Way, Corvallis, Oregon. Members of the public may attend in person or join by videoteleconference from Forest Service facilities in Hebo, Waldport, or Reedsport, Oregon.
Written comments may be submitted as described under
Lisa Romano, RAC Coordinator, by phone at 541-750-7075 or via email at
Individuals who use telecommunication devices for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1-800-877-8339 between 8:00 a.m. and 8:00 p.m., Eastern Standard Time, Monday through Friday.
The purpose of the meeting is:
1. To conduct RAC business,
2. Elect a RAC chairperson,
3. Set the Fiscal Year 2016 overhead rate,
4. Share information,
5. Provide a public forum, and
6. Review and select Projects for Title II funding.
The meeting is open to the public. The agenda will include time for people to make oral statements of three minutes or less. Individuals wishing to make an oral statement should request to do so in writing by May 23, 2016, to be scheduled on the agenda. Anyone who would like to bring related matters to the attention of the committee may file written statements with the committee staff before or after the meeting. Written comments and requests for time for oral comments must be sent to Lisa Romano, RAC Coordinator, 3200 SW. Jefferson Way, Corvallis, Oregon 97331; or by email to
The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments are requested regarding (1) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques and other forms of information technology.
Comments regarding this information collection received by May 25, 2016 will be considered. Written comments should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), New Executive Office Building, 725 17th Street NW., Washington, DC 20503. Commentors are encouraged to submit their comments to OMB via email to:
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments are requested regarding (1) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
Comments regarding this information collection received by May 25, 2016 will be considered. Written comments should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), New Executive Office Building, 725-17th Street NW., Washington, DC 20502. Commenters are encouraged to submit their comments to OMB via email to:
An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.
The Materials Processing Equipment Technical Advisory Committee (MPETAC) will meet on May 17, 2016, 9:00 a.m., Room 3884, in the Herbert C. Hoover Building, 14th Street between Pennsylvania and Constitution Avenues NW., Washington, DC. The Committee advises the Office of the Assistant Secretary for Export Administration with respect to technical questions that affect the level of export controls applicable to materials processing equipment and related technology.
1. Opening remarks and introductions.
2. Presentation of papers and comments by the Public.
3. Discussions on results from last, and proposals from last Wassenaar meeting.
4. Report on proposed and recently issued changes to the Export Administration Regulations.
5. Other business.
6. Discussion of matters determined to be exempt from the provisions relating to public meetings found in 5 U.S.C. app. 2 §§ 10 (a)(1) and 10 (a)(3).
The open session will be accessible via teleconference to 20 participants on a first come, first serve basis. To join the conference, submit inquiries to Ms. Yvette Springer at
A limited number of seats will be available for the public session. Reservations are not accepted. To the extent that time permits, members of the public may present oral statements to the Committee. The public may submit written statements at any time before or after the meeting. However, to facilitate the distribution of public presentation materials to the Committee members, the Committee suggests that presenters forward the public presentation materials prior to the meeting to Ms. Springer via email.
The Assistant Secretary for Administration, with the concurrence of the delegate of the General Counsel, formally determined on April 11, 2016, pursuant to Section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. app. 2 § 10(d)), that the portion of the meeting dealing with matters the premature disclosure of which would be likely to frustrate significantly implementation of a proposed agency action as described in 5 U.S.C. 552b(c)(9)(B) shall be exempt from the provisions relating to public meetings found in 5 U.S.C. app. 2 §§ 10(a)(1) and 10(a)(3). The remaining portions of the meeting will be open to the public. For more information, call Yvette Springer at (202) 482-2813.
International Trade Administration, DOC.
Notice of federal advisory committee meeting
This notice sets forth the schedule and proposed agenda of a meeting of the Environmental Technologies Trade Advisory Committee (ETTAC).
The meeting is scheduled for Tuesday, May 24, 2016, at 8:30 a.m. Eastern Standard Time (EST).
The meeting will be held in Room 3407 at the U.S. Department of Commerce, Herbert Clark Hoover Building, 1401 Constitution Avenue NW., Washington, DC 20230.
Ms. Maureen Hinman, Office of Energy & Environmental Industries (OEEI), International Trade Administration, Room 4053, 1401 Constitution Avenue NW., Washington, DC 20230 (Phone: 202-482-0627; Fax: 202-482-5665; email:
The meeting will take place from 8:30 a.m. to 3:30 p.m. EDT. The general meeting is open to the public and time will be permitted for public comment from 3:00-3:30 p.m. EDT. Those interested in attending must provide notification by Tuesday, May 10, 2016 at 5:00 p.m. EDT, via the contact information provided above. Written comments concerning ETTAC affairs are welcome any time before or after the meeting. Minutes will be available within 30 days of this meeting.
The agenda for this meeting will include discussion of priorities and objectives for the committee, trade promotion programs within the International Trade Administration, and subcommittee working meetings.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Patrick O'Connor or Aleksandras Nakutis, at (202) 482-0989 or (202) 482-3147, AD/CVD Operations, Enforcement and Compliance, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.
On March 28, 2016, the Department of Commerce (the Department) received an antidumping duty (AD) petition concerning imports of ferrovanadium from the Republic of Korea (Korea), filed in proper form on behalf of the Vanadium Producers and Reclaimers Association (VPRA) and VPRA members AMG Vanadium LLC (AMG V), Bear Metallurgical Company (Bear), Gulf Chemical & Metallurgical Corporation (Gulf), and Evraz Stratcor, Inc. (Stratcor) (Petitioners).
On March 31, 2016, and April 6, 2016, the Department requested additional information and clarification of certain areas of the Petition.
In accordance with section 732(b) of the Tariff Act of 1930, as amended (the Act), Petitioners allege that imports of ferrovanadium from Korea are being, or are likely to be, sold in the United States at less-than-fair value within the meaning of section 731 of the Act, and that such imports are materially injuring, or threatening material injury to, an industry in the United States. Also, consistent with section 732(b)(1) of the Act, the Petition is accompanied by information reasonably available to Petitioners supporting their allegations.
The Department finds that Petitioners filed this Petition on behalf of the domestic industry because Petitioners are interested parties as defined in section 771(9)(C), (E), and (F) of the Act. The Department also finds that Petitioners demonstrated sufficient
Because the Petition was filed on March 28, 2016, the period of investigation (POI) is, pursuant to 19 CFR 351.204(b)(1), January 1, 2015, through December 31, 2015.
The product covered by this investigation is ferrovanadium from Korea. For a full description of the scope of this investigation,
During our review of the Petition, the Department issued questions to, and received responses from, Petitioners pertaining to the proposed scope to ensure that the scope language in the Petition would be an accurate reflection of the products for which the domestic industry is seeking relief.
As discussed in the preamble to the Department's regulations,
The Department requests that any factual information the parties consider relevant to the scope of the investigation be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigation may be relevant, the party may contact the Department and request permission to submit the additional information.
All submissions to the Department must be filed electronically using Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS).
The Department requests comments from interested parties regarding the appropriate physical characteristics of ferrovanadium to be reported in response to the Department's AD questionnaires. This information will be used to identify the key physical characteristics of the subject merchandise in order to report sales and costs of production information accurately as well as to develop appropriate product-comparison criteria.
Interested parties may provide any information or comments that they believe are relevant to the development of physical characteristics for reporting and product matching purposes. Specifically, they may provide comments as to which characteristics are appropriate to use as: (1) General product characteristics and (2) product-comparison criteria. We note that it is not always appropriate to use all product characteristics as product-comparison criteria. We base product-comparison criteria on meaningful commercial differences among products. In other words, although there may be some physical product characteristics utilized by manufacturers to describe ferrovanadium, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in matching products. Generally, the Department attempts to list the most important physical characteristics first and the least important characteristics last.
In order to consider the suggestions of interested parties in developing and issuing the AD questionnaires, all comments must be filed by 5:00 p.m. ET on May 9, 2016, which is 21 calendar days from the signature date of this notice. Any rebuttal comments must be filed by 5:00 p.m. ET on May 16, 2016. All comments and submissions to the Department must be filed electronically using ACCESS, as explained above, on the record of this Korea less-than-fair-value investigation.
Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) At least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, the Department shall: (i) Poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the “industry.”
Section 771(4)(A) of the Act defines the “industry” as the producers as a whole of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs the Department to look to producers and workers who produce the domestic like product. The International Trade Commission (ITC), which is responsible for determining whether “the domestic industry” has been injured, must also determine what
Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (
With regard to the domestic like product, Petitioners do not offer a definition of the domestic like product distinct from the scope of the investigation. Based on our analysis of the information submitted on the record, we have determined that ferrovanadium, as defined in the scope, constitutes a single domestic like product, and we have analyzed industry support in terms of that domestic like product.
In determining whether Petitioners have standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petition with reference to the domestic like product as defined in the “Scope of the Investigation,” in Appendix I of this notice. To establish industry support, Petitioners provided the 2015 production of the domestic like product by the two petitioning companies that produce ferrovanadium in the United States (AMG Vanadium, LLC and Bear Metallurgical Company).
Our review of the data provided in the Petition and other information readily available to the Department indicates that Petitioners have established industry support.
The Department finds that Petitioners filed the Petition on behalf of the domestic industry because they are interested parties as defined in sections 771(9)(C), (E), and (F) of the Act and they have demonstrated sufficient industry support with respect to the AD investigation that they are requesting the Department initiate.
Petitioners allege that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than normal value (NV). In addition, Petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
Petitioners contend that the industry's injured condition is illustrated by reduced market share, underselling and price suppression or depression, lost sales and revenues, decline in shipments and toll production volume, negative impact on employment, and decline in financial performance.
The following is a description of the allegation of sales at less-than-fair value upon which the Department based its decision to initiate the investigation of imports of ferrovanadium from Korea. The sources of data relating to U.S. price and the usage quantities and input values relating to NV are discussed in greater detail in the initiation checklist.
Petitioners based U.S. prices on three affidavits documenting U.S. sales of ferrovanadium from Korea through a U.S. trading company during the POI.
Petitioners asserted that they were unable to obtain pricing data for sales of Korean-produced ferrovanadium by either Korean ferrovanadium producers or tollees of Korean ferrovanadium producers in the Korean market or in third country markets.
Pursuant to section 773(e) of the Act, CV consists of the cost of manufacturing (COM); SG&A expenses; financial expenses; packing expenses; and, profit. Petitioners calculated COM and packing expenses using usage rates that are based on a U.S. producer's experience during the proposed POI.
Based on the data provided by Petitioners, there is reason to believe that imports of ferrovanadium from Korea are being, or are likely to be, sold in the United States at less-than-fair value. Based on comparisons of export price (EP) to NV in accordance with sections 772 and 773 of the Act, the estimated dumping margins for ferrovanadium for Korea range from 20.25 to 54.69 percent.
Based upon the examination of the AD Petition on ferrovanadium from Korea, we find that the Petition meets the requirements of section 732 of the Act. Therefore, we are initiating a less-than-fair-value investigation to determine whether imports of ferrovanadium from Korea are being, or are likely to be, sold in the United States at less-than-fair value. In accordance with section 733(b)(1)(A) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determination no later than 140 days after the date of this initiation.
Petitioners identified a number of producers and/or exporters of Korean ferrovanadium.
In accordance with section 732(b)(3)(A) of the Act and 19 CFR 351.202(f), copies of the public version of the Petition have been provided to the government of Korea via ACCESS. To the extent practicable, we will attempt to provide a copy of the public version of the Petition to the exporters named in the Petition, as provided under 19 CFR 351.203(c)(2).
We will notify the ITC of our initiation, as required by section 732(d) of the Act.
The ITC will preliminarily determine, within 45 days after the date on which the Petition was filed, whether there is a reasonable indication that imports of ferrovanadium from Korea are materially injuring or threatening material injury to a U.S. industry.
Factual information is defined in 19 CFR 351.102(b)(21) as: (i) Evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by the Department; and (v) evidence other than factual information described in (i)-(iv). Any party, when submitting factual information, must specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted
Parties may request an extension of time limits before the expiration of a time limit established under 19 CFR 351, or as otherwise specified by the Secretary. In general, an extension request will be considered untimely if it is filed after the time limit established under 19 CFR 351 expires. For submissions that are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10:00 a.m. ET on the due date. Under certain circumstances, the Department may elect to specify a different time limit for extension requests for submissions which are due from multiple parties simultaneously. In such cases, we will inform parties of the time limit by issuing a letter or memorandum setting forth the deadline (including a specified time) by which extension requests must be filed to be considered timely. An extension request must be made in a separate, stand-alone submission; under limited circumstances we will grant untimely-filed requests for the extension of time limits. Review
Any party submitting factual information in an AD or CVD proceeding must certify to the accuracy and completeness of that information.
Interested parties must submit applications for disclosure under administrative protective order (APO) in accordance with 19 CFR 351.305. On January 22, 2008, the Department published
This notice is issued and published pursuant to section 777(i) of the Act.
The product covered by this investigation is all ferrovanadium regardless of grade (
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice; issuance of permit modification.
Notice is hereby given that Raymond Carthy, Ph.D., University of Florida, Florida Cooperative Fish and Wildlife Research Unit, 117 Newins-Ziegler Hall, P.O. Box 110450, Gainesville, FL 32611 has been issued a modification to scientific research Permit No. 17183-01.
The modification and related documents are available for review upon written request or by appointment in the Permits and Conservation Division, Office of Protected Resources, NMFS, 1315 East-West Highway, Room 13705, Silver Spring, MD 20910; phone (301) 427-8401; fax (301) 713-0376.
Amy Hapeman, (301) 427-8401.
On July 29, 2015, notice was published in the
Permit No. 17183-01 authorizes Dr. Carthy to continue long-term research on the demographics and movements of green (
Issuance of this modification, as required by the ESA was based on a finding that such permit (1) was applied for in good faith, (2) will not operate to the disadvantage of such endangered or threatened species, and (3) is consistent with the purposes and policies set forth in section 2 of the ESA.
The Department of Commerce will submit to the Office of Management and Budget (OMB) for clearance the following proposal for collection of
Pacific States Marine Fisheries Commission (PSMFC) is the Data Collection Agent for the CR Program. The CR Crab EDR program collects annually reported cost, revenue, ownership, and employment data from harvest and processing sector participants in the CR fisheries. This information is necessary to monitor and assess the economic effects of the CR program and support rigorous economic analysis to promote the goals and objectives of the Magnuson-Stevens Fishery Conservation and Management Act.
Participation in the CR Crab EDR program is mandatory under Federal fisheries regulations 50 CFR part 680.6 for all active vessel and processing sector participants in the CR Program fisheries.
This information collection request may be viewed at reginfo.gov. Follow the instructions to view Department of Commerce collections currently under review by OMB.
Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to
National Oceanic and Atmospheric Administration (NOAA), Commerce.
Notice.
The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.
Written comments must be submitted on or before June 24, 2016.
Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at
Requests for additional information or copies of the information collection instrument and instructions should be directed to Julia Royster, Office of Habitat Conservation, Restoration Center, 1315 East-West Highway, Silver Spring, 20910, (301) 427-8686, or
This request is for a revision and extension of a currently approved information collection.
Collection of estuary habitat restoration project information (
The collection method has been revised to only include paper or electronic forms instead of web-based data entry forms, as maintaining the web-based data entry option is not cost-effective.
Respondents have a choice of either electronic or paper forms. Methods of submittal include email of electronic forms, and mail and facsimile transmission of paper forms.
Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Applications for four new scientific research permits and four permit renewals.
Notice is hereby given that NMFS has received eight scientific research permit application requests relating to Pacific salmon, steelhead, and eulachon. The proposed research is intended to increase knowledge of species listed under the Endangered Species Act (ESA) and to help guide management and conservation efforts. The applications may be viewed online at:
Comments or requests for a public hearing on the applications must be received at the appropriate address or fax number (see
Written comments on the applications should be sent to the Protected Resources Division, NMFS, 1201 NE Lloyd Blvd., Suite 1100, Portland, OR 97232-1274. Comments may also be sent via fax to 503-230-5441 or by email to
Rob Clapp, Portland, OR (ph.: 503-231-2314), Fax: 503-230-5441, email:
The following listed species are covered in this notice:
Chinook salmon (
Steelhead (
Chum salmon (
Coho salmon (
Scientific research permits are issued in accordance with section 10(a)(1)(A) of the ESA (16 U.S.C. 1531
Anyone requesting a hearing on an application listed in this notice should set out the specific reasons why a hearing on that application would be appropriate (see
The United States Geological Survey (USGS) has requested a permit to annually take juvenile and adult LCR Chinook and coho, CR chum, and MCR steelhead while conducting research designed to (1) determine the diversity and distribution of fish species in the White Salmon River and tributaries, (2) compare populations of salmonids in the White Salmon and tributaries to pre-dam removal levels, (3) contribute to complimentary efforts by WDFW to characterize life history, genetics, and fish health of Chinook stocks in the lower White Salmon River. The USGS would capture fish by using a screw trap and backpack electrofishing equipment. Captured fish would be anesthetized, measured, weighed, and inspected for external diseases. Researchers would take fin clips of some captured fish in order to collect genetic tissues. Some juvenile fish would be PIT tagged to determine smolt trap efficiency and provide life history information through recaptures and detections at Bonneville Dam as juveniles or adults. The researchers would avoid adult salmonids, but some may be encountered as an unintentional result of sampling. The researchers do not expect to kill any listed salmonids but a small number may die as an unintended result of the research activities.
The Columbia River Inter-Tribal Fish Commission (CRITFC) is seeking a five-year permit to expand on and extend work previously conducted under other research permits (Permits 1532 and 15549). The research would take place in Satus, Ahtanum, Naches, and Toppenish Creeks in Washington State. The researchers wish to take juvenile MCR steelhead during the course of research designed to determine the fishes' freshwater movements and examine how those movements are affected by the area's substantially altered hydrograph. They would also collect baseline information on stock status and yearly abundance and seek to determine whether repeat spawners from a kelt reconditioning program are successfully reproducing.
The fish would be captured using screw traps and backpack electrofishing equipment. They would then be anesthetized and measured. Some would be tissue-sampled for DNA and some would receive passive integrated transponder (PIT) tags. The information gathered would be used to determine the fishes' movements and abundance and monitor the ongoing status of the various MCR steelhead populations in the Yakima River subbasin. The research would benefit the fish by helping managers determine the effectiveness of current recovery measures and design new ones where needed. The CRITFC does not plan to kill any of the fish being captured, but a few may die as an unintentional result of the research.
The Colville Confederated Tribes (CCT) are seeking a five-year permit to take juvenile UCR steelhead in the Okanogan River, Washington. The purpose of the research is to monitor steelhead populations in the basin. The researchers are seeking to estimate natural production and productivity and calculate annual population estimates, egg-to-emigrant survival, and emigrant-to-adult survival rates. The population estimates would be used to evaluate the effects of supplementation programs in the Okanogan River Basin and provide managers with the data they need to determine spawning success. The research would benefit the fish by giving state and Federal managers information on UCR steelhead status and the degree to which they are being
The Oregon Department of Fish and Wildlife (ODFW) is seeking to renew permit 16290 for five years. The permit would authorize ODFW to take listed salmonids while conducting research on the Oregon Chub. The purpose of the research is to study the distribution, abundance, and factors limiting the recovery of Oregon chub. The ODFW would capture, handle, and release juvenile UWR Chinook salmon, UWR steelhead, LCR Chinook salmon, LCR steelhead, LCR coho salmon, and CR chum salmon while conducting the research. The Oregon chub is endemic to the Willamette Valley of Oregon and the habitats it depends on are also important to salmonids. Research on the Oregon chub would benefit listed salmonids by helping managers recover habitats shared by the species. The ODFW researchers would use boat electrofishing equipment, minnow traps, beach seines, dip nets, hoop nets, and fyke nets to capture juvenile fish. Researchers would avoid contact with adult fish. If listed salmonids are captured during the research they would be released immediately. The researchers do not expect to kill any listed salmonids but a small number may die as an unintended result of the research activities.
The Confederated Tribes of the Colville Reservation (CCT) are seeking a five-year permit to monitor UCR steelhead population sizes, habitat use, and emigration rates in the Okanogan River and its tributaries in Washington State. Much of the proposed work for this permit was already being conducted under a previous permit (18049—now in its last year), but the CCT wanted to expand on that work, so rather than applying for a modification, they determined to seek an entirely new permit. The researchers would conduct their work in randomly-selected sites on eleven tributaries to the Okanogan River. They would capture juvenile steelhead using backpack electrofishing units and soft-mesh dipnets. The captured fish would be anesthetized and measured, and any steelhead greater than 95mm in fork length would be marked with a 12mm passive integrated transponder (PIT) tag injected from a single-use needle. All fish less than 95mm in length would have their caudal fins clipped for marking purposes and, in some cases, the tissue would be retained for DNA analysis. The researchers would make two passes with the electrofishing unit in each stream reach. The research would benefit the listed fish in two ways: First, UCR steelhead status in the Okanogan River subbasin is poorly understood and the information generated by the research would fill that gap and thereby help managers design recovery strategies for the listed fish in that area; it would also help them guide and mitigate any future land management activities that could affect the fish. Second, the collected genetic material would be used to examine the relationship between natural and hatchery fish in the area—and given that hatchery influence is considered a limiting factor for the UCR steelhead, more knowledge about that interaction would help managers design actions to address the negative effects local hatchery programs may be having. The researchers do not intend to kill any of the fish being captured, but a small number may die as an inadvertent result of the research activities.
The Idaho Power Company (IPC) is seeking a five-year permit to take juvenile and adult SR steelhead during the course of research designed to assess fish communities in and around the reservoirs formed by the Hells Canyon Complex of dams on the Snake River between Oregon and Idaho. The research encompasses six studies, but only two of them have the potential to affect salmonids listed under the ESA (1) winder bull trout surveys in the area between the Hells Canyon Complex and the Snake River's confluence with the Grande Ronde River; and (2) surveys for white sturgeon ion the mainstem Snake River downstream from the confluence with the Clearwater River in Idaho. Both of these studies have previously been conducted and covered under an ESA section 4(d) authorization overseen by the states, but it has since been determined that the most effective way of covering the actions would be for the IPC to seek a new section 10 permit. The bull trout study would be conducted during the winter via hook-and-line angling using barbless hooks. Any listed fish that are captured would immediately be released without further sampling, anesthetizing, etc. The white sturgeon study would be conducted using baited setlines on the bottom of the reservoirs and channel. The placement and timing of the setlines are such that it is very unlikely that any listed salmonids would be captured—none have been collected during the previous 30,000+ hours setlines have been in use under the 4(d) authorizations, but the captures could still take place. If such an event does occur, the listed fish would immediately be release without the researchers taking any further action.
The research would benefit listed fish by gathering information on fish community health over a several tens of miles of mainstem habitat. That information, in turn, would be used by IPC managers to balance water releases from the Hells Canyon dams, guide restoration projects, and make other management decisions for the benefit of the fish. The researchers do not intend to kill any listed salmonids, but a few may dies as an inadvertent result of the activities.
The U.S. Fish and Wildlife Service (FWS) is seeking a five-year permit to take juvenile SR steelhead while conducting a study to assess abundance and habitat use among juvenile Pacific lamprey in the Snake River and some of its tributaries. The researchers are proposing to conduct stream surveys for juvenile Pacific lamprey
The streams would be surveyed at approximately 1 km intervals, focusing on slow water fine substrate areas where lamprey juveniles reside. The researchers would avoid riffles and deep pool areas that are likely to contain salmonids. At each site, approximately 30 m of stream would be surveyed. The
The USFWS is seeking a five-year research permit to take MCR steelhead while conducting research on bull trout in the White Salmon River, Washington. Before its removal in 2011, Condit Dam blocked fish access to most of the White Salmon River basin for nearly 100 years. In 2007 and 2010, the USFWS surveyed for and did not find any bull trout in the White Salmon River basin. The conclusion of those surveys was that bull trout were extirpated and the dam was the likely cause. The purpose of USFWS' current research is to evaluate whether or not bull trout have begun to recolonize the White Salmon River basin. The research would benefit listed salmonids by providing information on the rebounding health of the White Salmon system—data that would be used in the ongoing restoration efforts in the area. The USFWS would use backpack electrofishing gear to capture fish and would release juvenile steelhead immediately. The researchers do not expect to kill any steelhead but a small number may die as an unintended result of the research activities.
This notice is provided pursuant to section 10(c) of the ESA. NMFS will evaluate the applications, associated documents, and comments submitted to determine whether the applications meet the requirements of section 10(a) of the ESA and Federal regulations. The final permit decisions will not be made until after the end of the 30-day comment period. NMFS will publish notice of its final action in the
National Telecommunications and Information Administration, U.S. Department of Commerce.
Notice of open meeting.
As part of the Digital Economy Agenda, the Department of Commerce is working to identify data gaps in measuring the importance of cross-border data flows and the economic impact of restrictions to the free-flow of data. Through this Notice, we announce a roundtable to facilitate a discussion with stakeholders and experts as a first step in improving the Department's understanding of those data gaps and related economic questions.
The roundtable will be held on May 9, 2016, from 8:30 a.m. to 12:00 p.m., Eastern Daylight Time.
The roundtable will be held at the Bureau of Labor Statistics Conference Center, 2 Massachusetts Avenue NE., Washington, DC
Giulia McHenry, Chief Economist, NTIA, at (202) 482-0061 or
The Department of Commerce (Commerce) recognizes that worldwide data usage and data flows between countries are growing and becoming an increasingly important component of international trade and communication between individuals and businesses worldwide. It is generally accepted that cross-border data flows increase economic opportunity and restrictions to these flows are economically detrimental, but there is relatively little supporting data or evidence. Commerce is working to identify data gaps in measuring the importance of cross-border data flows and the economic impact of restrictions to the free-flow of data. We are hosting this roundtable of stakeholders and experts as a first step in improving the information available to data users and other stakeholders. The goal of this roundtable is to get input from stakeholders on what additional data and analysis on cross-border data flows is necessary.
NTIA will post a detailed agenda on its Web site,
The roundtable will be open to observers and press on a first-come, first-served basis. Space is limited. Attendees must present valid government-issued photo identification upon arrival in order to enter the building.
So that we may plan appropriately to accommodate all interested persons, attendees are asked to provide prior notice of their intention to attend by sending an email to Giulia McHenry at or
The public meeting is physically accessible to people with disabilities. Individuals requiring accommodations, such as sign language interpretation or other ancillary aids, are asked to notify Giulia McHenry at (202) 482-0061 or
Please contact Giulia McHenry at (202) 482-0061 or
Consumer Product Safety Commission.
Notice.
As required by the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the Consumer Product Safety Commission (“CPSC” or “Commission”) requests comments on a proposed extension of approval of a collection of information regarding a form used to verify whether pools and spas are in compliance with the Virginia Graeme Baker Pool and Spa Safety Act. The Office of Management and Budget (“OMB”) previously approved the collection of information under control number 3041-0142. The Commission will consider all comments received in response to this notice before requesting an extension of approval of this collection of information from OMB.
Submit written or electronic comments on the collection of information by June 24, 2016.
You may submit comments, identified by Docket No. CPSC-2009-0073, by any of the following methods:
Robert H. Squibb, Consumer Product Safety Commission, 4330 East West Highway, Bethesda, MD 20814; (301) 504-7815, or by email to:
CPSC seeks to renew the following currently approved collection of information:
On December 19, 2008, the Virginia Graeme Baker Pool and Spa Safety Act (“Act”) became effective (Pub. L. 110-140). The Act applies to public pools and spas and requires that each swimming pool and spa drain cover manufactured, distributed, or entered into commerce in the United States shall conform to the entrapment protection standards of the ASME/ANSI A112.19.8 performance standard or any successor standard regulating such swimming pool or drain cover pursuant to section 1404(b) of the Pool and Spa Safety Act (Drain Cover Standard).
On August 5, 2011, the Commission published a final rule incorporating by reference ANSI/APSP-16 2011 as the successor standard, effective September 6, 2011. 76 FR 47436. The Act requires that, in addition to having the anti-entrapment devices or systems, each public pool and spa in the United States with a single main drain other than an unblockable drain shall be equipped with one or more of the following devices or systems designed to prevent entrapment by pool or spa drains including a safety vacuum release system, suction-limiting vent system, gravity drainage system, automatic pump shut-off system or drain disablement. CPSC will collect information through the verification of compliance form to identify drain covers, pools, and spas that do not meet the performance requirements in ANSI/APSP-16 2011 and the Act.
The Commission solicits written comments from all interested persons about the proposed collection of information. The Commission specifically solicits information relevant to the following topics:
Uniformed Services University of the Health Sciences (“the University”), Department of Defense.
Quarterly meeting notice.
The Department of Defense is publishing this notice to announce the following meeting of the Board of Regents, Uniformed Services University of the Health Sciences (“the Board”).
Friday, May 20, 2016, from 8:00 a.m. to 10:45 a.m. (Open Session) and 1:15 p.m. to 2:00 p.m. (Closed Session).
Uniformed Services University of the Health Sciences, 4301 Jones Bridge Road, Everett Alvarez Jr. Board of Regents Room (D3001), Bethesda, Maryland 20814.
Jennifer Nuetzi James, Designated Federal Officer, 4301 Jones Bridge Road, D3002, Bethesda, Maryland 20814; telephone 301-295-3066; email
This meeting notice is being published under the provisions of the Federal Advisory Committee Act of 1972 (5 U.S.C., Appendix, as amended), the Government in the Sunshine Act of 1976 (5 U.S.C. 552b, as amended), and 41 CFR 102-3.150.
Pursuant to 5 U.S.C. 552b(c)(2, 5-7), the Department of Defense has determined that the portion of the meeting from 1:15 p.m. to 2:00 p.m. shall be closed to the public. The Under Secretary of Defense (Personnel and Readiness), in consultation with the Office of the DoD General Counsel, has determined in writing that a portion of the committee's meeting will be closed as the discussion will disclose sensitive personnel information, will include matters that relate solely to the internal personnel rules and practices of the agency, will involve allegations of a person having committed a crime or censuring an individual, and may disclose investigatory records compiled for law enforcement purposes.
Notice.
The Department of Defense has submitted to OMB for clearance, the following proposal for collection of information under the provisions of the Paperwork Reduction Act.
Consideration will be given to all comments received by May 25, 2016.
Fred Licari, 571-372-0493.
Comments and recommendations on the proposed information collection should be emailed to Ms. Stephanie Tatham, DoD Desk Officer, at
You may also submit comments and recommendations, identified by Docket ID number and title, by the following method:
•
Written requests for copies of the information collection proposal should be sent to Mr. Licari at WHS/ESD Directives Division, 4800 Mark Center Drive, East Tower, Suite 02G09, Alexandria, VA 22350-3100.
Defense Finance and Accounting Service (DFAS), DoD.
Notice.
In compliance with the
Consideration will be given to all comments received by June 24, 2016.
You may submit comments, identified by docket number and title, by any of the following methods:
•
•
Any associated form(s) for this collection may be located within this same electronic docket and downloaded for review/testing. Follow the instructions at
To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the Defense Finance and Accounting Service, Enterprise Solutions and Standards, ATTN: Stuart Kran (JJFJB), 1240 East 9th Street, Cleveland, Ohio 44199 or via email at
Office of Innovation and Improvement, Department of Education.
Notice.
Investing in Innovation Fund—Development Grants.
Notice inviting applications for new awards for fiscal year (FY) 2016.
Catalog of Federal Domestic Assistance (CFDA) Number: 84.411P (Development grants Pre-Application) and 84.411C (Development grants Full Application).
To receive an Investing in Innovation Fund (i3) Development grant, an entity must submit a pre-application. The pre-application is intended to reduce the burden of submitting a full application for an i3 Development grant. Pre-applications will be reviewed and scored by peer reviewers using the selection criteria designated in this notice. Entities that submit a highly rated pre-application will be invited to submit a full application for a Development grant; however, any entity that successfully submits a pre-application may choose to submit a full application.
As importantly, all i3 projects are required to generate additional evidence of effectiveness. All i3 grantees must use part of their budgets to conduct independent evaluations (as defined in this notice) of their projects. This requirement ensures that projects funded under the i3 program contribute significantly to improving the information available to practitioners and policymakers about which practices work, for which types of students, and in what contexts.
The Department awards three types of grants under this program: “Development” grants, “Validation” grants, and “Scale-up” grants. These grants differ in terms of the level of prior evidence of effectiveness required for consideration of funding, the level of scale the funded project should reach, and, consequently, the amount of funding available to support the project.
Development grants provide funding to support the development or testing of practices that are supported by evidence of promise (as defined in this notice) or a strong theory (as defined in this notice) and whose efficacy should be systematically studied. Development grants will support new or substantially more effective practices for addressing widely shared challenges. Development projects are novel and significant nationally, not projects that simply implement existing practices in additional locations or support needs that are primarily local in nature. All Development grantees must evaluate the effectiveness of the project at the level of scale proposed in the application. This notice invites applications for Development grants only. The Department anticipates publishing notices inviting applications for the other types of i3 grants (Validation and Scale-up grants) in the spring of 2016.
We remind LEAs of the continuing applicability of the provisions of the Individuals with Disabilities Education Act (IDEA) for students who may be served under i3 grants. Any grants in which LEAs participate must be consistent with the rights, protections, and processes established under IDEA for students who are receiving special education and related services or who are in the process of being evaluated to determine their eligibility for such services.
As described later in this notice, an applicant is required, as a condition of receiving assistance under this program, to make civil rights assurances, including an assurance that its program or activity will comply with section 504 of the Rehabilitation Act of 1973, as amended, and the Department's section 504 implementing regulations, which prohibit discrimination on the basis of disability. Regardless of whether a student with disabilities is specifically targeted as a “high-need student” (as defined in this notice) in a particular grant application, recipients are required to comply with all legal nondiscrimination requirements, including, but not limited to, the obligation to ensure that students with disabilities are not denied access to the benefits of the recipient's program because of their disability. The Department also enforces Title II of the Americans with Disabilities Act (ADA), as well as the regulations implementing Title II of the ADA, which prohibit discrimination on the basis of disability by public entities.
Furthermore, Title VI and Title IX of the Civil Rights Act of 1964 prohibit discrimination on the basis of race, color, and national origin, and sex, respectively. On December 2, 2011, the Departments of Education and Justice jointly issued guidance that explains how educational institutions can promote student diversity or avoid racial isolation within the framework of Title VI (
Through its competitions, the i3 program seeks to improve the academic achievement of students in high-need schools by identifying and scaling promising solutions to pressing challenges in kindergarten through grade 12 (K-12). Now in its seventh year, the i3 program has invested over $1.3 billion—matched by over $200 million in private sector resources—in a portfolio of solutions and rigorous evaluations of several approaches that address critical challenges in education. When selecting the priorities for a given competition, the Department considers several factors including policy priorities, the need for new solutions in a particular priority area, the extent of the existing evidence supporting effective practices in a particular priority area, whether other available funding exists for a particular priority area, and the results and lessons learned from funded projects from prior i3 competitions. This year's competition does not include specific priorities for students with disabilities and English learners, as the program has successfully funded a range of projects serving these high-need populations under i3's broader priorities in previous competitions. Additionally, all applicants continue to be required to serve high-need student populations, and we continue to encourage applicants to consider how their
We include five absolute priorities in the FY 2016 Development competition. We include absolute priorities that are intended to prompt new approaches to challenges in education, represent new areas of policy focus in which rigorous evidence is scarce, and constitute areas that we would like to strengthen within the current portfolio of i3 grantees. As in the past three competitions, applicants applying under the Serving Rural Communities priority (Absolute Priority 5) must also address one of the other four absolute priorities established for the FY 2016 i3 Development competition. This structure has resulted in a strong set of grantees that are addressing the unique challenges in rural communities. We also include one competitive preference priority as described below.
First, we include an absolute priority that asks applicants to focus their projects on student diversity. In parts of the country, America's schools are more segregated than they were in the late 1960s, including by students' race and socioeconomic status.
Therefore, through the invitational priority, the Department invites projects with ambitious strategies that improve outcomes for high-need students by increasing racial and socioeconomic diversity in classroom or school settings. These projects could leverage approaches at the school, district, or regional level that encourage racial or socioeconomic diversity within classroom or school environments. Proposed strategies may range from new instructional approaches that impact socioeconomic integration and student achievement within schools (
Second, we include an absolute priority for projects designed to implement and support the transition to internationally benchmarked, college- and career-ready academic content standards and associated assessments. Many States have raised the expectations for what schools should teach and their students should learn and do across the K-12 grade span by adopting new, more rigorous standards and assessments aligned to the demands of college and careers. Emerging research confirms that these exams are aligned to more rigorous standards.
Third, we include an absolute priority to improve school climate. Under this priority, the Department seeks to support innovative alternatives to exclusionary discipline and other positive interventions that can help address the negative and often disparate impact of classroom removals by promoting safe schools that have a positive culture for all students. When students feel engaged and supported in school, their academic performance improves; this type of engagement and support is particularly important for students with disabilities and students of color (especially African-American male students) who suffer
Fourth, we include an absolute priority on influencing the development of non-cognitive factors. Non-cognitive factors may encompass many skills and behaviors, including but not limited to academic behaviors, academic mindset, perseverance, self-regulation, social and emotional skills, and approaches toward learning strategies.
Fifth, we include an absolute priority that focuses on serving rural communities. Students living in rural communities face unique challenges. Applicants applying under this priority must also address one of the other four absolute priorities established for the FY 2016 i3 Development competition, while serving students enrolled in rural LEAs (as defined in this notice).
We also include one competitive preference priority in the FY 2016 Development competition. To expand the reach of the i3 program and encourage entities that have not previously received an i3 grant to apply, the Department includes a competitive preference priority for novice i3 applicants. A novice i3 applicant is an applicant that has never received a grant under the i3 program. An applicant must identify whether it is a novice applicant when completing the applicant information sheet. Instructions on how to complete the applicant information sheet are included in the application package.
In summary, applications must address one of the first four absolute priorities for this competition and propose projects designed to implement practices that serve students who are in grades K-12 at some point during the funding period. If an applicant chooses to also address the absolute priority regarding students in rural LEAs, that applicant must also address one of the other four absolute priorities established for the FY 2016 i3 Development competition, while serving students enrolled in rural LEAs (as defined in this notice). Applicants must be able to demonstrate that the proposed process, product, strategy, or practice included in their applications is supported by either evidence of promise (as defined in this notice) or a strong theory (as defined in this notice). Applicants should carefully review all of the application requirements and the requirements in the
To meet the eligibility requirement regarding the applicant's record of improvement, an applicant must provide, in its application, sufficient supporting data or other information to allow the Department to determine whether the applicant has met the eligibility requirements. Note that, to address the statutory eligibility requirements in paragraphs (a)(1) or (2), and (b) of the statutory eligibility requirements (provided in the
The i3 program includes a statutory requirement for a private-sector match for all i3 grantees. For Development grants, an applicant must obtain matching funds or in-kind donations from the private sector equal to at least 15 percent of its grant award. Each highest-rated applicant, as identified by the Department following peer review of the applications, must submit evidence of at least 50 percent of the required private-sector match prior to the awarding of an i3 grant. An applicant must provide evidence of the remaining 50 percent of the required private-sector match no later than three months after the project start date (
An entity that submits a full application for a Development grant should include the following information in its application: An estimate of the number of students to be served by the project; evidence of the applicant's ability to implement and appropriately evaluate the proposed project; and information about its capacity (
The Department will screen applications that are submitted for Development grants in accordance with the requirements in this notice and determine which applications meet eligibility and other requirements. Peer reviewers will review all applications for Development grants that are submitted by the established deadline.
Applicants should note, however, that we may screen for eligibility at multiple points during the competition process, including before and after peer review; and applicants that are determined to be ineligible will not receive a grant award regardless of peer reviewer scores or comments. If we determine that a Development grant application is not supported by evidence of promise (as defined in this notice) or a strong theory (as defined in this notice), or that the applicant does not demonstrate the required prior record of improvement, or does not meet any other i3 requirement, the application will not be considered for funding.
Please note that on December 10, 2015, the Every Student Succeeds Act (ESSA), which reauthorized the Elementary and Secondary Education Act of 1965, was signed into law. ESSA establishes the Education Innovation and Research Program (EIR), a new program that builds on the work led by the i3 program and its grantees. Accordingly, this FY 2016 i3 competition will be the final i3 competition under current statute and regulations. Pending congressional appropriations, the Department will launch the first EIR competition in FY 2017.
Under the Development grant competition, each of the five absolute priorities constitutes its own funding category. The Secretary intends to award grants under each absolute priority for which applications of sufficient quality are submitted.
Applicants must address one of the first five absolute priorities in their pre-applications and full applications. An applicant that addresses Absolute Priority 5, Serving Rural Communities, must also address one of the first four absolute priorities. Because applications will be rank ordered by absolute priority, applicants must clearly identify the specific absolute priority that the proposed project addresses. Applications submitted under Absolute Priority 5 will be ranked with other applications under Absolute Priority 5, and not included in the ranking for the additional priority that the applicant identified. This design helps us ensure that applications under Absolute Priority 5 receive an “apples to apples” comparison with other applicants addressing the Serving Rural Communities priority.
These priorities are:
Under this priority, we provide funding to projects that are designed to prepare students for success in an increasingly diverse workforce and society by increasing the diversity, including racial, ethnic, and socioeconomic diversity, of students enrolled in individual schools or postsecondary programs; or, in the case of preschool, elementary, or secondary programs, decreasing the racial, ethnic, or socioeconomic isolation of students who are served by the project.
Within this absolute priority, we are particularly interested in applications that address the following invitational priority.
This priority is:
Designing and implementing intra-district, inter-district, community, or regional programs that improve student outcomes by increasing socioeconomic diversity. Such programs may include one or more of the following:
• Giving students increased choices in selecting a high-quality public school (
• Policies designed to attract and enroll substantial proportions of students from low-income households in schools that have relatively fewer students from low-income households in those schools, enrolling such students, and providing school-level support to promote equitable academic success within such schools.
• Establishing magnet schools, theme-based schools, or other schools of choice (
• Providing targeted academic and socio-emotional interventions to retain economically disadvantaged children within schools, and to support their academic success.
• Restructuring programs for high-achieving students such as honors programs, gifted and talented programs, or Advanced Placement or International Baccalaureate courses, so that they include students from low-income households and support their academic success.
Please note that evaluations of these programs should pay special attention to creating measurable outcomes for high-need students.
Under this priority, we provide funding to projects that are designed to support the implementation of, and transition to, internationally
Under this priority, we provide funding to projects that are designed to improve student outcomes through reducing or eliminating disparities in school disciplinary practices for particular groups of students, including minority students and students with disabilities, or reducing or eliminating the use of exclusionary discipline (such as suspensions, expulsions, and unnecessary placements in alternative education programs) by identifying and addressing the root causes of those disparities or uses and promoting alternative disciplinary practices that address the disparities or uses.
Under this priority, we provide funding to projects that are designed to improve students' mastery of non-cognitive skills and behaviors (such as academic behaviors, academic mindset, perseverance, self-regulation, social and emotional skills, and approaches toward learning strategies) and enhance student motivation and engagement in learning.
Under this priority, we provide funding to projects that address one of the absolute priorities established for the 2016 Development i3 competition and under which the majority of students to be served are enrolled in rural local educational agencies (as defined in this notice).
The priority is:
Eligible applicants that have never directly received a grant under this program.
(i) There is at least one study that is a—
(A) Correlational study with statistical controls for selection bias;
(B) Quasi-experimental design study that meets the What Works Clearinghouse Evidence Standards with reservations; or
(C) Randomized controlled trial that meets the What Works Clearinghouse Evidence Standards with or without reservations.
(ii) The study referenced in paragraph (i) of this definition found a statistically significant or substantively important (defined as a difference of 0.25 standard deviations or larger) favorable association between at least one critical component and one relevant outcome presented in the logic model for the proposed process, product, strategy, or practice.
(a) For grades and subjects in which assessments are required under ESEA section 1111(b)(3): (1) A student's score on such assessments and may include (2) other measures of student learning, such as those described in paragraph (b), provided they are rigorous and comparable across schools within an LEA.
(b) For grades and subjects in which assessments are not required under ESEA section 1111(b)(3): Alternative measures of student learning and performance such as student results on pre-tests, end-of-course tests, and objective performance-based assessments; student learning objectives; student performance on English language proficiency assessments; and other measures of student achievement that are rigorous and comparable across schools within an LEA.
The regulations in 34 CFR part 79 apply to all applicants except federally recognized Indian tribes.
The regulations in 34 CFR part 86 apply to institutions of higher education only.
These estimated available funds are the total available for all three types of grants under the i3 program (Development, Validation, and Scale-up grants). Contingent upon the availability of funds and the quality of applications, we may make additional awards in FY 2017 or later years from the list of unfunded applications from this competition.
Development grants: Up to $3,000,000.
Validation grants: Up to $12,000,000.
Scale-up grants: Up to $20,000,000.
The upper limit of the range of awards (
Development grants: $3,000,000.
Validation grants: $11,500,000.
Scale-up grants: $19,000,000.
Development grants: 9-11 awards.
Validation grants: 2-3 awards.
Scale-up grants: 0-2 awards.
The Department is not bound by any estimates in this notice.
1.
2.
3.
(a) An LEA.
(b) A partnership between a nonprofit organization and—
(1) One or more LEAs; or
(2) A consortium of schools.
(a)(1) Have significantly closed the achievement gaps between groups of students described in section 1111(b)(2) of the ESEA (economically disadvantaged students, students from major racial and ethnic groups, students with limited English proficiency, students with disabilities); or
(2) Have demonstrated success in significantly increasing student
(b) Have made significant improvements in other areas, such as high school graduation rates (as defined in this notice) or increased recruitment and placement of high-quality teachers and principals, as demonstrated with meaningful data;
(c) Demonstrate that it has established one or more partnerships with the private sector, which may include philanthropic organizations, and that organizations in the private sector will provide matching funds in order to help bring results to scale; and
(d) In the case of an eligible applicant that includes a nonprofit organization, provide in the application the names of the LEAs with which the nonprofit organization will partner, or the names of the schools in the consortium with which it will partner. If an eligible applicant that includes a nonprofit organization intends to partner with additional LEAs or schools that are not named in the application, it must describe in the application the demographic and other characteristics of these LEAs and schools and the process it will use to select them.
An entity submitting an application should provide, in Appendix C, under “Other Attachments Form,” of its application, information addressing the eligibility requirements described in this section. An applicant must provide, in its application, sufficient supporting data or other information to allow the Department to determine whether the applicant has met the eligibility requirements. Note that, to address the statutory eligibility requirements in paragraphs (a)(1) or (2), and (b), applicants must provide data that demonstrate a change due to the work of the applicant with an LEA or schools. In other words, applicants must provide data for at least two definitive points in time when addressing this requirement in Appendix C of their applications. For further guidance, please refer to the definition of “student achievement” in this notice; and the question and answer Webinar for FY 2016 i3 Development Full Applications for further guidance. Additionally, information on the statutory eligibility requirements can be found on the i3 Web site at
For purposes of this program, an LEA is an LEA located within one of the 50 States, the District of Columbia, or the Commonwealth of Puerto Rico.
The authorizing statute specifies that an eligible applicant that includes a nonprofit organization meets the requirements in paragraphs (a) and (b) of the eligibility requirements for this program if the nonprofit organization has a record of significantly improving student achievement, attainment, or retention. For an eligible applicant that includes a nonprofit organization, the nonprofit organization must demonstrate that it has a record of significantly improving student achievement, attainment, or retention through its record of work with an LEA or schools. Therefore, an eligible applicant that includes a nonprofit organization does not necessarily need to include as a partner for its i3 grant an LEA or a consortium of schools that meets the requirements in paragraphs (a) and (b) of the eligibility requirements in this notice.
In addition, the authorizing statute specifies that an eligible applicant that includes a nonprofit organization meets the requirements of paragraph (c) of the eligibility requirements in this notice if the eligible applicant demonstrates that it will meet the requirement for private-sector matching.
4.
The Secretary may consider decreasing the matching requirement on a case-by-case basis, and only in the most exceptional circumstances. An eligible applicant that anticipates being unable to meet the full amount of the private-sector matching requirement must include in its application a request that the Secretary reduce the matching-level requirement, along with a statement of the basis for the request.
An applicant that does not provide a request for a reduction of the matching-level requirement in its full application may not submit that request at a later time.
5.
•
Applicants must identify in Appendix D and the Applicant Information Sheet if their evidence is supported by evidence of promise or a strong theory.
In Appendix D, under the “Other Attachments Form,” an entity that submits a full application should provide information addressing one of the required evidence standards for Development grants. This information should include a description of the intervention(s) the applicant plans to implement and the intended student outcomes that the intervention(s) attempts to impact.
Applicants must identify in Appendix D and the Applicant Information Sheet if their evidence is supported by evidence of promise or a strong theory. An applicant submitting its Development grant application under the evidence of promise standard should identify up to two study citations to be reviewed for the purposes of meeting the i3 evidence standard requirement and include those citations in Appendix D. In addition, the applicant should specify the intervention that they plan to implement, the findings within the citations that the applicant is requesting be considered as evidence of promise, including page number(s) of specific tables if applicable. The Department will not consider a study citation that an applicant fails to clearly identify for review.
An applicant must either ensure that all evidence is available to the Department from publicly available sources and provide links or other guidance indicating where it is available; or, in the full application, include copies of evidence in Appendix D. If the Department determines that an applicant has provided insufficient information, the applicant will not have an opportunity to provide additional information at a later time. However, for applicants applying under evidence of promise, if the WWC determines that a study does not provide enough information on key aspects of the study design, such as sample attrition or equivalence of intervention and comparison groups, the WWC will submit a query to the study author(s) to gather information for use in determining a study rating. Authors are asked to respond to queries within ten business days. Should the author query
The evidence standards apply to the prior research that supports the effectiveness of the proposed project. The i3 program does not restrict the source of prior research providing evidence for the proposed project. As such, an applicant could cite prior research in Appendix D for studies that were conducted by another entity (
•
•
•
•
In addition, the grantee and its independent evaluator must agree to cooperate with any technical assistance provided by the Department or its contractor and comply with the requirements of any evaluation of the program conducted by the Department. This includes providing to the Department, within 100 days of a grant award, an updated comprehensive evaluation plan in a format and using such tools as the Department may require. Grantees must update this evaluation plan at least annually to reflect any changes to the evaluation. All of these updates must be consistent with the scope and objectives of the approved application.
•
•
1.
If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call, toll free: 1-877-576-7734.
You can contact ED Pubs at its Web site, also:
If you request an application package from ED Pubs, be sure to identify this competition as follows: CFDA number 84.411P (for pre-applications) or 84.411C (for full applications).
Individuals with disabilities can obtain a copy of the application package in an accessible format (
2. a.
We will be able to develop a more efficient process for reviewing grant applications if we know the approximate number of applicants that intend to apply for funding under this competition. Therefore, the Secretary strongly encourages each potential applicant to notify us of the applicant's intent to submit a pre-application by completing a Web-based form. When completing this form, applicants will provide (1) the applicant organization's name and address and (2) the absolute priority the applicant intends to address. Applicants may access this form online at
Applicants for both pre- and full applications should use the following standards:
• A “page” is 8.5″ x 11″, on one side only, with 1″ margins at the top, bottom, and both sides.
• Double space (no more than three lines per vertical inch) all text in the application narrative, including titles, headings, footnotes, quotations, references, and captions.
• Use a font that is either 12 point or larger or no smaller than 10 pitch (characters per inch).
•
The page limit for the full application does not apply to Part I, the cover sheet; Part II, the budget section, including the narrative budget justification; Part IV, the assurances and certifications; or the one-page abstract, the resumes, the bibliography, or the letters of support for the full application. However, the page limit does apply to all of the application narrative section of the full application.
b.
Consistent with the process followed in the prior i3 competitions, we plan on posting the project narrative section of funded i3 applications on the Department's Web site. Accordingly, you may wish to request confidentiality of business information. Identifying proprietary information in the submitted application will help facilitate this public disclosure process.
Consistent with Executive Order 12600, please designate in your application any information that you believe is exempt from disclosure under Exemption 4. In the appropriate Appendix section of your application, under “Other Attachments Form,” please list the page number or numbers on which we can find this information. For additional information please see 34 CFR 5.11(c).
3.
Pre- and full applications for Development grants under this competition must be submitted electronically using the Grants.gov Apply site (Grants.gov). For information (including dates and times) about how to submit your application electronically, or in paper format by mail or hand delivery if you qualify for an exception to the electronic submission requirement, please refer to
We do not consider an application that does not comply with the deadline requirements.
Individuals with disabilities who need an accommodation or auxiliary aid in connection with the application process should contact the person listed under
4.
5.
6.
a. Have a Data Universal Numbering System (DUNS) number and a Taxpayer Identification Number (TIN);
b. Register both your DUNS number and TIN with the System for Award Management (SAM) (formerly the Central Contractor Registry), the Government's primary registrant database;
c. Provide your DUNS number and TIN on your application; and
d. Maintain an active SAM registration with current information while your application is under review by the Department and, if you are awarded a grant, during the project period.
You can obtain a DUNS number from Dun and Bradstreet at the following Web site:
If you are a corporate entity, agency, institution, or organization, you can obtain a TIN from the Internal Revenue Service. If you are an individual, you can obtain a TIN from the Internal Revenue Service or the Social Security Administration. If you need a new TIN, please allow two to five weeks for your TIN to become active.
The SAM registration process can take approximately seven business days, but may take upwards of several weeks, depending on the completeness and accuracy of the data you enter into the SAM database. Thus, if you think you might want to apply for Federal financial assistance under a program administered by the Department, please allow sufficient time to obtain and register your DUNS number and TIN. We strongly recommend that you register early.
If you are currently registered with SAM, you may not need to make any changes. However, please make certain that the TIN associated with your DUNS number is correct. Also note that you will need to update your registration annually. This may take three or more business days.
Information about SAM is available at
In addition, if you are submitting your application via Grants.gov, you must (1) be designated by your organization as an Authorized Organization Representative (AOR); and (2) register yourself with Grants.gov as an AOR. Details on these steps are outlined at the following Grants.gov Web page:
7.
a.
Applications (both pre- and full applications) for Development grants under the i3 program, CFDA number 84.411P (pre-applications) and CFDA number 84.411C (full applications), must be submitted electronically using the Governmentwide Grants.gov Apply site at
We will reject your application if you submit it in paper format unless, as described elsewhere in this section, you qualify for one of the exceptions to the electronic submission requirement
You may access the electronic grant application for the i3 program at
Please note the following:
• When you enter the Grants.gov site, you will find information about submitting an application electronically through the site, as well as the hours of operation.
• Applications received by Grants.gov are date and time stamped. Your application must be fully uploaded and submitted and must be date and time stamped by the Grants.gov system no later than 4:30:00 p.m., Washington, DC time, on the application deadline date. Except as otherwise noted in this section, we will not accept your application if it is received—that is, date and time stamped by the Grants.gov system—after 4:30:00 p.m., Washington, DC time, on the application deadline date. We do not consider an application that does not comply with the deadline requirements. When we retrieve your application from Grants.gov, we will notify you if we are rejecting your application because it was date and time stamped by the Grants.gov system after 4:30:00 p.m., Washington, DC time, on the application deadline date.
• The amount of time it can take to upload an application will vary depending on a variety of factors, including the size of the application and the speed of your Internet connection. Therefore, we strongly recommend that you do not wait until the application deadline date to begin the submission process through Grants.gov.
• You should review and follow the Education Submission Procedures for submitting an application through Grants.gov that are included in the application package for this competition to ensure that you submit your application in a timely manner to the Grants.gov system. You can also find the Education Submission Procedures pertaining to Grants.gov under News and Events on the Department's G5 system home page at
• You will not receive additional point value because you submit your application in electronic format, nor will we penalize you if you qualify for an exception to the electronic submission requirement, as described elsewhere in this section, and submit your application in paper format.
• You must submit all documents electronically, including all information you typically provide on the following forms: the Application for Federal Assistance (SF 424), the Department of Education Supplemental Information for SF 424, Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.
• You must upload any narrative sections and all other attachments to your application as files in a read-only, non-modifiable Portable Document Format (PDF). Do not upload an interactive or fillable PDF file. If you upload a file type other than a read-only, non-modifiable PDF (
• Your electronic application must comply with any page-limit requirements described in this notice.
• After you electronically submit your application, you will receive from Grants.gov an automatic notification of receipt that contains a Grants.gov tracking number. This notification indicates receipt by Grants.gov only, not receipt by the Department. Grants.gov will also notify you automatically by email if your application met all the Grants.gov validation requirements or if there were any errors (such as submission of your application by someone other than a registered Authorized Organization Representative, or inclusion of an attachment with a file name that contains special characters). You will be given an opportunity to correct any errors and resubmit, but you must still meet the deadline for submission of applications.
Once your application is successfully validated by Grants.gov, the Department will retrieve your application from Grants.gov and send you an email with a unique PR/Award number for your application.
These emails do not mean that your application is without any disqualifying errors. While your application may have been successfully validated by Grants.gov, it must also meet the Department's application requirements as specified in this notice and in the application instructions. Disqualifying errors could include, for instance, failure to upload attachments in a read-only, non-modifiable PDF; failure to submit a required part of the application; or failure to meet applicant eligibility requirements. It is your responsibility to ensure that your submitted application has met all of the Department's requirements.
• We may request that you provide us original signatures on forms at a later date.
If you are prevented from electronically submitting your application on the application deadline date because of technical problems with the Grants.gov system, we will grant you an extension until 4:30:00 p.m., Washington, DC time, the following business day to enable you to transmit your application electronically or by hand delivery. You also may mail your application by following the mailing instructions described elsewhere in this notice.
If you submit an application after 4:30:00 p.m., Washington, DC time, on the application deadline date, please contact the person listed under
• You do not have access to the Internet; or
• You do not have the capacity to upload large documents to the Grants.gov system;
• No later than two weeks before the application deadline date (14 calendar days or, if the fourteenth calendar day before the application deadline date falls on a Federal holiday, the next business day following the Federal holiday), you mail or fax a written statement to the Department, explaining which of the two grounds for an exception prevents you from using the Internet to submit your application.
If you mail your written statement to the Department, it must be postmarked no later than two weeks before the application deadline date. If you fax your written statement to the Department, we must receive the faxed statement no later than two weeks before the application deadline date.
Address and mail or fax your statement to: Kelly Terpak, U.S. Department of Education, 400 Maryland Avenue SW., Room 4W312, Washington, DC 20202. FAX: (202) 401-4123.
Your paper application must be submitted in accordance with the mail or hand delivery instructions described in this notice.
b.
If you qualify for an exception to the electronic submission requirement, you may mail (through the U.S. Postal Service or a commercial carrier) your application to the Department. You must mail the original and two copies of your application, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.411P or 84.411C), LBJ Basement Level 1, 400 Maryland Avenue SW., Washington, DC 20202-4260,
You must show proof of mailing consisting of one of the following:
(1) A legibly dated U.S. Postal Service postmark.
(2) A legible mail receipt with the date of mailing stamped by the U.S. Postal Service.
(3) A dated shipping label, invoice, or receipt from a commercial carrier.
(4) Any other proof of mailing acceptable to the Secretary of the U.S. Department of Education.
If you mail your application through the U.S. Postal Service, we do not accept either of the following as proof of mailing:
(1) A private metered postmark.
(2) A mail receipt that is not dated by the U.S. Postal Service.
We will not consider applications postmarked after the application deadline date.
c.
If you qualify for an exception to the electronic submission requirement, you (or a courier service) may deliver your paper application to the Department by hand. You must deliver the original and two copies of your application by hand, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.411P or 84.411C), 550 12th Street SW., Room 7039, Potomac Center Plaza, Washington, DC 20202-4260.
The Application Control Center accepts hand deliveries daily between 8:00 a.m. and 4:30:00 p.m., Washington, DC time, except Saturdays, Sundays, and Federal holidays.
(1) You must indicate on the envelope and—if not provided by the Department—in Item 11 of the SF 424 the CFDA number, including suffix letter, if any, of the competition under which you are submitting your application; and
(2) The Application Control Center will mail to you a notification of receipt of your grant application. If you do not receive this notification within 15 business days from the application deadline date, you should call the U.S. Department of Education Application Control Center at (202) 245-6288.
1.
The points assigned to each criterion are indicated in the parentheses next to the criterion. An applicant may earn up to a total of 20 points based on the selection criteria for the pre-application. An applicant may earn up to a total of 100 points based on the selection criteria for the full application.
A.
In determining the significance of the project, the Secretary considers the extent to which the proposed project involves the development or demonstration of promising new strategies that build on, or are alternatives to, existing strategies. (34 CFR 75.210)
B.
In determining the quality of the proposed project design, the Secretary considers the extent to which the goals, objectives, and outcomes to be achieved by the project are clearly specified and measured. (34 CFR 75.210)
A.
In determining the significance of the project, the Secretary considers the following factors:
(1) The magnitude or severity of the problem to be addressed by the proposed project. (34 CFR 75.210)
(2) The extent to which the proposed project involves the development or demonstration of promising new strategies that build on, or are alternatives to, existing strategies. (34 CFR 75.210)
(3) The extent to which the proposed project addresses the absolute priority the applicant is seeking to meet. (2013 i3 NFP)
B.
In determining the quality of the proposed project design, the Secretary considers the following factors:
(1) The extent to which the goals, objectives, and outcomes to be achieved by the project are clearly specified and measurable. (34 CFR 75.210)
(2) The adequacy of the management plan to achieve the objectives of the proposed project on time and within budget, including clearly defined responsibilities, timelines, and milestones for accomplishing project tasks. (2013 i3 NFP)
(3) The adequacy of procedures for ensuring feedback and continuous improvement in the operation of the proposed project. (2013 i3 NFP)
(4) The mechanisms the applicant will use to broadly disseminate information on its project so as to support further development or replication. (34 CFR 75.210)
C.
In determining the quality of the project evaluation to be conducted, the Secretary considers the following factors:
(1) The clarity and importance of the key questions to be addressed by the project evaluation, and the appropriateness of the methods for how each question will be addressed. (2013 i3 NFP)
(2) The extent to which the methods of evaluation will, if well-implemented, produce evidence about the project's effectiveness that would meet the What Works Clearinghouse Evidence Standards with reservations. (34 CFR 75.210)
(3) The extent to which the proposed project plan includes sufficient resources to carry out the project evaluation effectively. (2013 i3 NFP)
2.
Before making awards, we will screen applications submitted in accordance with the requirements in this notice to determine which applications have met eligibility and other statutory requirements. This screening process may occur at various stages of the pre-application and full application processes; applicants that are determined ineligible will not receive a grant, regardless of peer reviewer scores or comments.
For the pre- and full application review processes, we will use independent peer reviewers with varied backgrounds and professions including pre-kindergarten through grade 12 teachers and principals, college and university educators, researchers and evaluators, social entrepreneurs, strategy consultants, grant makers and managers, and others with education expertise. All reviewers will be thoroughly screened for conflicts of interest to ensure a fair and competitive review process.
Peer reviewers will read, prepare a written evaluation of, and score the assigned pre-applications and full applications, using the respective selection criteria provided in this notice. For Development grant pre-applications, peer reviewers will review and score the applications based on the two selection criteria for pre-applications listed in the
We remind potential applicants that in reviewing applications in any discretionary grant competition, the Secretary may consider, under 34 CFR 75.217(d)(3), the past performance of the applicant in carrying out a previous award, such as the applicant's use of funds, achievement of project objectives, and compliance with grant conditions. The Secretary may also consider whether the applicant failed to submit a timely performance report or submitted a report of unacceptable quality.
In addition, in making a competitive grant award, the Secretary requires various assurances, including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department of Education (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).
3.
1.
If your application is not evaluated or not selected for funding, we notify you.
2.
We reference the regulations outlining the terms and conditions of an award in the
3.
(b) At the end of your project period, you must submit a final performance report, including financial information, as directed by the Secretary. If you receive a multiyear award, you must submit an annual performance report that provides the most current performance and financial expenditure information as directed by the Secretary under 34 CFR 75.118. The Secretary may also require more frequent performance reports under 34 CFR 75.720(c). For specific requirements on reporting, please go to
(c) Under 34 CFR 75.250(b), the Secretary may provide a grantee with additional funding for data collection analysis and reporting. In this case the Secretary establishes a data collection period.
4.
5.
In making a continuation award, the Secretary also considers whether the grantee is operating in compliance with the assurances in its approved application, including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).
Kelly Terpak, U.S. Department of Education, 400 Maryland Avenue SW., Room 4CW312, Washington, DC 20202. Telephone: (202) 453-7122. FAX: (202) 401-4123 or by email:
If you use a TDD or a TTY, call the Federal Relay Service, toll free, at 1-800-877-8339.
You may also access documents of the Department published in the
Department of Energy.
Notice of open meeting.
This notice announces a meeting of the Environmental Management Site-Specific Advisory Board (EM SSAB), Northern New Mexico. The Federal Advisory Committee Act (Pub. L. 92-463, 86 Stat. 770) requires that public notice of this meeting be announced in the
Wednesday, May 18, 2016, 1:00 p.m.-5:15 p.m.
Cities of Gold Conference Center, 10-A Cities of Gold Road, Pojoaque, New Mexico 87506.
Menice Santistevan, Northern New Mexico Citizens' Advisory Board (NNMCAB), 94 Cities of Gold Road, Santa Fe, NM 87506. Phone (505) 995-0393; Fax (505) 989-1752 or Email:
Department of Energy.
Notice of open meeting.
This notice announces a meeting of the Environmental Management Advisory Board (EMAB). The Federal Advisory Committee Act (Pub. L. 92-463, 86 Stat. 770) requires that public notice of this meeting be announced in the
Wednesday, May 11, 2016, 9:00 a.m.-5:00 p.m.
The Applied Research Center, 301 Gateway Drive, Aiken, South Carolina 29803.
Kristen G. Ellis, Designated Federal Officer, EMAB (EM-3.2), U.S. Department of Energy, 1000 Independence Avenue SW., Washington, DC 20585. Phone (202) 586-5810; fax (202) 586-0293 or email:
Take notice that the Commission received the following electric corporate filings:
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
This is a supplemental notice in the above-referenced proceeding of White Oak Solar, LLC`s application for market-based rate authority, with an accompanying rate tariff, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.
Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to intervene or protest must serve a copy of that document on the Applicant.
Notice is hereby given that the deadline for filing protests with regard to the applicant's request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability, is May 9, 2016.
The Commission encourages electronic submission of protests and interventions in lieu of paper, using the
Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.
The filings in the above-referenced proceeding are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for electronic review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email
This constitutes notice, in accordance with 18 CFR 385.2201(b), of the receipt of prohibited and exempt off-the-record communications.
Order No. 607 (64 FR 51222, September 22, 1999) requires Commission decisional employees, who make or receive a prohibited or exempt off-the-record communication relevant to the merits of a contested proceeding, to deliver to the Secretary of the Commission, a copy of the communication, if written, or a summary of the substance of any oral communication.
Prohibited communications are included in a public, non-decisional file associated with, but not a part of, the decisional record of the proceeding. Unless the Commission determines that the prohibited communication and any responses thereto should become a part of the decisional record, the prohibited off-the-record communication will not be considered by the Commission in reaching its decision. Parties to a proceeding may seek the opportunity to respond to any facts or contentions made in a prohibited off-the-record communication, and may request that the Commission place the prohibited communication and responses thereto in the decisional record. The Commission will grant such a request only when it determines that fairness so requires. Any person identified below as having made a prohibited off-the-record communication shall serve the document on all parties listed on the official service list for the applicable proceeding in accordance with Rule 2010, 18 CFR 385.2010.
Exempt off-the-record communications are included in the decisional record of the proceeding, unless the communication was with a cooperating agency as described by 40 CFR 1501.6, made under 18 CFR 385.2201(e)(1)(v).
The following is a list of off-the-record communications recently received by the Secretary of the Commission. The communications listed are grouped by docket numbers in ascending order. These filings are available for electronic review at the Commission in the Public Reference Room or may be viewed on the Commission's Web site at
Take notice that on April 18, 2016, pursuant to section 210 m of the Public Utility Regulatory Policies Act of 1978 (PURPA), 16 U.S.C. 824a-3(b), Interconnect Solar Development LLC filed a Petition for Enforcement alleging unlawful cancellation of QF Power Purchase Agreement and requesting the Federal Energy Regulatory Commission (Commission) to reincorporate previous FERC Docket Nos. EL13-51-000, Docket No. QF11-204-001 and QF11-205-001.
Any person desiring to intervene or to protest this filing must file in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211, 385.214). Protests will be considered by the Commission in determining the appropriate action to be taken, but will not serve to make protestants parties to the proceeding. Any person wishing to become a party must file a notice of intervention or motion to intervene, as appropriate. Such notices, motions, or protests must be filed on or before the comment date. On or before the comment date, it is not necessary to serve motions to intervene or protests on persons other than the Applicant.
The Commission encourages electronic submission of protests and interventions in lieu of paper using the “eFiling” link at
This filing is accessible on-line at
Take notice that the following hydroelectric application has been filed with the Commission and is available for public inspection:
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b.
c.
d.
e.
f.
g.
h.
i.
j. Deadline for filing comments, interventions and protests is 30 days from the issuance date of this notice by the Commission. The Commission strongly encourages electronic filing. Please file motions to intervene, protests and comments using the Commission's eFiling system at
k.
l.
m.
n. Individuals desiring to be included on the Commission's mailing list should so indicate by writing to the Secretary of the Commission.
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p.
q. Agency Comments—Federal, state, and local agencies are invited to file comments on the described proceeding. If any agency does not file comments within the time specified for filing comments, it will be presumed to have no comments.
Environmental Protection Agency (EPA).
Notice.
The Environmental Protection Agency has submitted an information collection request (ICR), “Distribution of Offsite Consequence Analysis Information under Section 112(r)(7)(H) of the Clean Air Act (CAA), as amended (Renewal)” (EPA ICR No. 1981.06, OMB Control No. 2050-0172) to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before May 25, 2016.
Submit your comments, referencing Docket ID No. EPA-HQ-OAR-2003-0073, to (1) EPA online using
EPA's policy is that all comments received will be included in the public docket without change including any personal information provided, unless the comment includes profanity, threats, information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute.
Sicy Jacob, Office of Emergency Management, Mail Code 5104A, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone number: (202) 564-8019; fax number: (202) 564-2625; email address:
Supporting documents which explain in detail the information that the EPA will be collecting are available in the public docket for this ICR. The docket can be viewed online at
On August 5, 1999, the President signed the Chemical Safety Information, Site Security, and Fuels Regulatory Relief Act (CSISSFRRA). The Act required the President to promulgate regulations on the distribution of OCA information (CAA section 112(r)(7)(H)(ii)). The President delegated to EPA and the Department of Justice (DOJ) the responsibility to promulgate
In accordance with the final rule, the federal government established 55 reading rooms at federal facilities geographically distributed across the United States and its territories. At these reading rooms, members of the public are able to read, but not mechanically copy or remove paper copies of OCA information for up to 10 stationary sources per calendar month. At these reading rooms, the members of the public may also have access to OCA information that the Local Emergency Planning Committee (LEPC) in whose jurisdiction the person lives or works is authorized to provide.
The final rule also authorizes and encourages state and local government officials to have access to OCA information for their official use, and to provide members of the public with read-only access to OCA sections of RMPs for sources located within the jurisdiction of the LEPC where the person lives or works and for any other stationary sources with vulnerability zones extending into the LEPC's jurisdiction.
EPA also established a Vulnerable Zone Indicator System (VZIS) that informs any person located in any state whether an address specified by that person might be within the vulnerable zone of one or more stationary sources, according to the data reported in RMPs. The VZIS is available on the Internet. Members of the public who do not have access to the Internet are able to obtain the same information by regular mail request to the EPA.
Environmental Protection Agency (EPA).
Notice of proposed issuance of NPDES General Permit and request for public comment.
The Environmental Protection Agency (EPA) Region 10 proposes to issue a National Pollutant Discharge Elimination System (NPDES) General Permit for Drinking Water Treatment Facilities in Idaho (DWGP). This proposed draft DWGP is intended to provide coverage for seven existing facilities with expired individual permits, in addition to any new applicants who are eligible for coverage. The seven existing permittees have individual permits which were issued on November 1, 2006, and expired on October 31, 2011. These seven permittees currently operate under an administrative extension of their individual permits. When issued, the DWGP will replace these seven administratively extended individual permits. As proposed, the DWGP authorizes the discharge from drinking water treatment facilities to surface waters within the State of Idaho from existing facilities and new facilities interested in seeking coverage. The draft DWGP contains technology-based and water quality-based effluent limitations for conventional and toxic pollutants, along with administrative reporting and monitoring requirements, as well as standard conditions, prohibitions, and management practices. A description of the basis for the conditions and requirements of the proposed general permit is given in the Fact Sheet.
Section 401 of the Clean Water Act, 33 U.S.C. 1341, requires EPA to seek a certification from the State of Idaho that the conditions of the DWGP comply with State water quality standards. The Idaho Department of Environmental Quality (IDEQ) has provided a draft certification that the draft DWGP complies with State of Idaho Water Quality Standards (IDAPA 58.01.02), including the State's antidegradation policy. EPA intends to seek a final certification from IDEQ prior to issuing the DWGP. This is also notice of the draft § 401 certification provided by IDEQ. Persons wishing to comment on the draft State certification should send written comments to Nicole Deinarowicz; Idaho Department of Environmental Quality, State Office, Surface Water Program; 1410 North Hilton Street; Boise, Idaho 83706 or via email to
The public comment period for the draft DWTP commences today and comments must be received or postmarked no later than midnight Pacific Daylight Time on May 25, 2016. All comments related to the draft DWGP and Fact Sheet received by EPA Region 10 by the comment deadline will be considered prior to issuing the final DWGP.
Comments on the draft DWGP may be sent to: Kai Shum, Office of Water and Watersheds; USEPA Region 10; 1200 6th Ave, Suite 900, OWW-191; Seattle, Washington 98101. Comments may also be submitted by fax to (206) 553-1280 or electronically to
Kai Shum, Office of Water and Watersheds, U.S. Environmental Protection Agency, Region 10. Contact information included above in the “Submitting Comments” Section.
Unfunded Mandates Reform Act
Section 201 of the Unfunded Mandates Reform Act (UMRA), Public Law 104-4, generally requires Federal agencies to assess the effects of their regulatory actions (defined to be the same as rules subject to the RFA) on tribal, state, and local governments, and the private sector. However, General NPDES Permits are not rules subject to the requirements of the APA, and are, therefore, not subject to the UMRA.
This action is taken under the authority of Section 402 of the Clean Water Act as amended, 42 U.S.C. 1342. I hereby provide public notice of the Draft Idaho DWGP in accordance with 40 CFR 124.10.
Environmental Protection Agency (EPA).
Notice.
This document announces the Office of Management and Budget (OMB) responses to Agency Clearance requests, in compliance with the Paperwork Reduction Act (44 U.S.C. 3501
Courtney Kerwin (202) 566-1669, or email at
EPA ICR Number 1856.10; NESHAP for Primary Lead Processing (Renewal); 40 CFR part 63, subparts A and TTT; was approved without change on 11/18/2015; OMB Number 2060-0414; expires on 11/30/2018.
EPA ICR Number 2294.04; NESHAP for Plating and Polishing Area Sources (Renewal); 40 CFR part 63, subparts A and WWWWWW; was approved without change on 11/18/2015; OMB Number 2060-0623; expires on 11/30/2018.
EPA ICR Number 1069.11; NSPS for Primary and Secondary Emissions from Basic Oxygen Furnaces (Renewal); 40 CFR part 60, subparts A, N and Na; was approved without change on 11/18/2015; OMB Number 2060-0029; expires on 11/30/2018.
EPA ICR Number 1167.11; NSPS for Lime Manufacturing (Renewal); 40 CFR part 63, subparts A and HH; was approved without change on 11/18/2015; OMB Number 2060-0063; expires on 11/30/2018.
EPA ICR Number 1716.09; NESHAP for Wood Furniture Manufacturing Operations (Renewal); 40 CFR part 63, subparts A and JJ; was approved without change on 11/18/2015; OMB Number 2060-0324; expires on 11/30/2018.
EPA ICR Number 1081.11; NESHAP for Inorganic Arsenic Emissions from Glass Manufacturing Plants (Renewal); 40 CFR part 61, subparts N and A; was approved without change on 11/18/2015; OMB Number 2060-0043; expires on 11/30/2018.
EPA ICR Number 1428.10; Trade Secret Claims for Community Right-to-Know and Emergency Planning (Renewal); 40 CFR part 350; was approved with change on 11/23/2015; OMB Number 2050-0078; expires on 11/30/2018.
EPA ICR Number 1446.11; PCBs: Consolidated Reporting and Recordkeeping Requirements (Renewal); 40 CFR part 761; was approved without change on 11/23/2015; OMB Number 2070-0112; expires on 11/30/2018.
EPA ICR Number 2163.05; NSPS for other Solid Waste Incineration (OSWI) Units (Renewal); 40 CFR part 60, subparts EEEE and A; was approved without change on 11/30/2015; OMB Number 2060-0563; expires on 11/30/2018.
EPA ICR Number 2486.01; Reporting and Recordkeeping Requirements for the Proposed Rule on Management Standards for Hazardous Waste Pharmaceuticals (Proposed Rule); 40 CFR part 266; OMB filed comment on 11/02/2015.
EPA ICR Number 2513.01; Reporting and Recordkeeping Requirements for the Proposed Hazardous Waste Generator Improvements Rule (Proposed Rule); 40 CFR parts 262.14 (a)(4) (viii) (B)(1)-(4), 262.11 (e), 262.15 (a)(5) (ii) and (iii), 262.16 (b)(6) (i)(B) and (C), 262.16 (b)(6) (ii)(B), 262.16 (b)(8) (vi) (3) (B), 262.17 (a) (5) (i) (B) and (C), 262.17 (a) (5) (ii) (B), 262.17 (a) (8) (i) (A) and (B), 262.17 (c) (4) (iv) (B)-(C), 262.17 (g), 262.18, 262.32 (c), 262.232, 262.233 (a), 262.234 (a), 262.256 (b), 262.262 (b)(2), 263.12 (b)(3)-(4), 268.50 (a)(2) (i) (C)-(D); OMB filed comment on 11/02/2015.
Environmental Protection Agency (EPA).
Notice.
The Environmental Protection Agency has submitted an information collection request (ICR), “NESHAP for Printing and Publishing Industry (40 CFR part 63, subpart KK) (Renewal)” (EPA ICR No. 1739.08, OMB Control No. 2060-0335), to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before May 25, 2016.
Submit your comments, referencing Docket ID Number EPA-HQ-OECA-2012-0666, to: (1) EPA online using
EPA's policy is that all comments received will be included in the public docket without change including any personal information provided, unless the comment includes profanity, threats, information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute.
Patrick Yellin, Monitoring, Assistance, and Media Programs Division, Office of Compliance, Mail Code 2227A, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone number: (202) 564-2970; fax number: (202) 564-0050; email address:
Supporting documents which explain in detail the information that the EPA will be collecting are available in the public docket for this ICR. The docket can be viewed online at
Environmental Protection Agency (EPA).
Notice.
EPA has submitted the following information collection request (ICR) to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act (PRA): “Assessment of Environmental Performance Standards and Ecolabels for Federal Procurement” and identified by EPA ICR No. 2516.01 and OMB Control No. 2070-NEW. The ICR is available in the docket along with other related materials, including details of the pilot assessment criteria for assessing volunteer standards and ecolabels, and the assessment tool for conducting the assessments. The ICR provides a detailed explanation of the collection activities and the burden estimate that is only briefly summarized in this document. EPA has addressed the comments received in response to the previously provided public review opportunity issued in the
Comments must be received on or before May 25, 2016.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPPT-2014-0838, to both EPA and OMB as follows:
• To EPA online using
• To OMB via email to
EPA's policy is that all comments received will be included in the docket without change, including any personal information provided, unless the comment includes profanity, threats, information claimed to be Confidential Business Information (CBI), or other information whose disclosure is restricted by statute. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.
To volunteer a standard or ecolabel to be assessed, please email the pilot effort's independent assessment entity under contract with EPA, Industrial Economics, Inc. at
Alison Kinn Bennett, Chemistry, Economics, and Sustainable Strategies Division (7409M), Office of Pollution
Federal agencies must comply with multiple sustainability-related purchasing mandates. While Federal purchasing policy is clear for the several standards and eco-labels that are listed in statute, regulation, or Executive Order, the lack of independently assessed information about and Federal guidance on using other product environmental performance standards and eco-labels often results in an inconsistent approach by Federal purchasers and confusion and uncertainty for vendors and manufacturers.
44 U.S.C. 3501
Environmental Protection Agency (EPA).
Notice.
The Environmental Protection Agency has submitted an information collection request (ICR), “Emission Guidelines and Compliance Times for Existing Municipal Solid Waste Landfills (40 CFR part 60, subpart Cc and 40 CFR part 62, subpart GGG) (Renewal)” (EPA ICR No. 1893.07, OMB Control No. 2060-0430), to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act (44 U.S.C. 3501
Additional comments may be submitted on or before May 25, 2016.
Submit your comments, referencing Docket ID Number EPA-HQ-OECA-2012-0680, to: (1) EPA online using
EPA's policy is that all comments received will be included in the public docket without change including any personal information provided, unless the comment includes profanity, threats, information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute.
Patrick Yellin, Monitoring, Assistance, and Media Programs Division, Office of Compliance, Mail Code 2227A, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460; telephone number: (202) 564-2970; email address:
Supporting documents which explain in detail the information that the EPA will be collecting are available in the public docket for this ICR. The docket can be viewed online at
Environmental Protection Agency (EPA).
Notice.
This notice announces EPA's approval of the Commonwealth of Pennsylvania's request to revise its National Primary Drinking Water Regulations Implementation EPA-authorized program to allow electronic reporting.
EPA's approval is effective May 25, 2016 for the Commonwealth of Pennsylvania's National Primary Drinking Water Regulations Implementation program, if no timely request for a public hearing is received and accepted by the Agency.
Karen Seeh, U.S. Environmental Protection Agency, Office of Environmental Information, Mail Stop 2823T, 1200 Pennsylvania Avenue NW., Washington, DC 20460, (202) 566-1175,
On October 13, 2005, the final Cross-Media Electronic Reporting Rule (CROMERR) was published in the
On March 7, 2016, the Pennsylvania Department of Environmental Protection (PA DEP) submitted an application titled Compliance Monitoring Data Portal for revision to its EPA-approved drinking water program under title 40 CFR to allow new electronic reporting. EPA reviewed PA DEP's request to revise its EPA-authorized program and, based on this review, EPA determined that the application met the standards for approval of authorized program revision set out in 40 CFR part 3, subpart D. In accordance with 40 CFR 3.1000(d), this notice of EPA's decision to approve Pennsylvania's request to revise its Part 142—National Primary Drinking Water Regulations Implementation program to allow electronic reporting under 40 CFR part 141 is being published in the
PA DEP was notified of EPA's determination to approve its application with respect to the authorized program listed above.
In today's notice, EPA is also informing interested persons that they may request a public hearing on EPA's action to approve the Commonwealth of Pennsylvania's request to revise its authorized public water system program under 40 CFR part 142, in accordance with 40 CFR 3.1000(f). Requests for a hearing must be submitted to EPA within 30 days of publication of today's
(1) The name, address and telephone number of the individual, organization or other entity requesting a hearing;
(2) A brief statement of the requesting person's interest in EPA's determination, a brief explanation as to why EPA should hold a hearing, and any other information that the requesting person wants EPA to consider when determining whether to grant the request;
(3) The signature of the individual making the request, or, if the request is made on behalf of an organization or other entity, the signature of a responsible official of the organization or other entity.
In the event a hearing is requested and granted, EPA will provide notice of the hearing in the
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3520), the Federal Communications Commission (FCC or Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collections. Comments are requested concerning: Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information collection burden on small business concerns with fewer than 25 employees. The FCC may not conduct or sponsor a collection of information unless it displays a currently valid Office of Management and Budget (OMB) control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid OMB control number.
Written comments should be submitted on or before May 25, 2016. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contacts below as soon as possible.
Direct all PRA comments to Nicholas A. Fraser, OMB, via email
For additional information or copies of the information collection, contact Nicole Ongele at (202) 418-2991. To view a copy of this information collection request (ICR) submitted to OMB: (1) Go to the Web page
Here, the Commission proposes to revise FCC Form 481 and its instructions to reflect information collection requirements that the Commission recently adopted. This includes reporting and certification requirements for price cap carriers that elected to receive Phase II model-based support, reporting and certification requirements for recipients of rural broadband experiment support, a reasonably comparable rate certification for broadband for recipients of high-cost support, and an E-rate bidding certification for Phase II model-based support and rate-of-return carrier high-cost recipients. The Commission also proposes to add templates for some of these obligations and to add a template for the existing obligation that certain ETCs report data regarding newly served community anchor institutions. Additionally, the Commission proposes to delete the outdated information collection for Phase II model-based support elections and to adjust the number of respondents for the state certification letter and annual reporting requirements to reflect that rural broadband experiment recipients must now meet these requirements. The Commission also proposes to modify the existing Phase II certification requirement to reduce the hours to reflect that some aspects of the existing certifications have been superseded by the new proposed requirements and to adjust the number of respondents to reflect the number of price cap carriers that accepted Phase II model-based support. Finally, the Commission proposes to make a number of non-substantive changes to FCC Form 481 and its instructions.
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3520), the Federal Communications Commission (FCC or the Commission) invites the general public and other federal agencies to take this opportunity to comment on the following information collection. Comments are requested concerning: Whether the collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information collection burden on small business concerns with fewer than 25 employees.
The FCC may not conduct or sponsor a collection of information unless it displays a currently valid control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid Office of Management and Budget (OMB) control number.
Written PRA comments should be submitted on or before June 24, 2016. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of
Direct all PRA comments to Cathy Williams, FCC, via email
For additional information about the information collection, contact Cathy Williams at (202) 418-2918.
Federal Election Commission.
Thursday, April 28, 2016 at 10:00 a.m.
999 E Street NW., Washington, DC (ninth floor).
This meeting will be open to the public.
Individuals who plan to attend and require special assistance, such as sign language interpretation or other reasonable accommodations, should contact Shawn Woodhead Werth, Secretary and Clerk, at (202) 694-1040, at least 72 hours prior to the meeting date.
Judith Ingram, Press Officer, Telephone: (202) 694-1220.
Board of Governors of the Federal Reserve System.
Notice is hereby given of the final approval of a proposed information collection by the Board of Governors of the Federal Reserve System (Board) under OMB delegated authority. Board-approved collections of information are incorporated into the official OMB inventory of currently approved collections of information. Copies of the Paperwork Reduction Act Submission, supporting statements and approved collection of information instrument(s) are placed into OMB's public docket files. The Federal Reserve may not conduct or sponsor, and the respondent is not required to respond to, an information collection that has been extended, revised, or implemented on or after October 1, 1995, unless it displays a currently valid OMB control number.
Federal Reserve Board Clearance Officer—Nuha Elmaghrabi—Office of the Chief Data Officer, Board of Governors of the Federal Reserve System, Washington, DC 20551; telephone (202) 452-3829. Telecommunications Device for the Deaf (TDD) users may contact (202) 263-4869, Board of Governors of the Federal Reserve System, Washington, DC 20551.
OMB Desk Officer—Shagufta Ahmed—Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 10235, 725 17th Street NW., Washington, DC 20503.
The companies listed in this notice have applied to the Board for approval, pursuant to the Bank Holding Company Act of 1956 (12 U.S.C. 1841
The applications listed below, as well as other related filings required by the Board, are available for immediate inspection at the Federal Reserve Bank indicated. The applications will also be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing on the standards enumerated in the BHC Act (12 U.S.C. 1842(c)). If the proposal also involves the acquisition of a nonbanking company, the review also includes whether the acquisition of the nonbanking company complies with the standards in section 4 of the BHC Act (12 U.S.C. 1843). Unless otherwise noted, nonbanking activities will be conducted throughout the United States.
Unless otherwise noted, comments regarding each of these applications must be received at the Reserve Bank indicated or the offices of the Board of Governors not later than May 20, 2016.
1.
Board of Governors of the Federal Reserve System.
The Board of Governors of the Federal Reserve System (Board or Federal Reserve) invites comment on a proposal to collect financial data on a consolidated basis from nonbank financial companies that the Financial Stability Oversight Council (FSOC) has determined pursuant to section 113 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), 12 U.S.C. 5323 should be supervised by the Board and subject to enhanced prudential standards and that have significant insurance activities, as outlined below. As of the date of publication of this notice, American International Group, Inc., and Prudential Financial, Inc., would be required to comply with the proposed information collection, if adopted.
On June 15, 1984, the Office of Management and Budget (OMB) delegated to the Board authority under the Paperwork Reduction Act (PRA) to approve of and assign OMB control numbers to collection of information requests and requirements conducted or sponsored by the Board. In exercising this delegated authority, the Board is directed to take every reasonable step to solicit comment. In determining whether to approve a collection of information, the Board will consider all comments received from the public and other agencies.
Comments must be submitted on or before June 24, 2016.
You may submit comments, identified by
•
•
•
•
• Mail: Robert deV. Frierson, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW., Washington, DC 20551.
All public comments are available from the Board's Web site at
Additionally, commenters may send a copy of their comments to the OMB Desk Officer—Shagufta Ahmed—Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 10235 725 17th Street NW., Washington, DC 20503 or by fax to (202) 395-6974.
A copy of the PRA OMB submission, including the proposed reporting form and instructions, supporting statement, and other documentation will be placed into OMB's public docket files, once approved. These documents will also be made available on the Federal Reserve Board's public Web site at:
Federal Reserve Board Clearance Officer—Nuha Elmaghrabi—Office of
The Board invites public comment on the following information collection, which is being reviewed under authority delegated by the OMB under the PRA. Comments are invited on the following:
a. Whether the proposed collection of information is necessary for the proper performance of the Federal Reserve's functions, including whether the information has practical utility;
b. The accuracy of the Federal Reserve's estimate of the burden of the proposed information collection, including the validity of the methodology and assumptions used;
c. Ways to enhance the quality, utility, and clarity of the information to be collected;
d. Ways to minimize the burden of information collection on respondents, including through the use of automated collection techniques or other forms of information technology; and
e. Estimates of capital or startup costs and costs of operation, maintenance, and purchase of services to provide information.
The information collection is authorized under section 161 of the Dodd-Frank Act.
The FR 2085 would include a balance sheet, an income statement, a statement of changes in equity, and detailed supporting schedules. The data requested in the proposed FR 2085 is additional information that is not publicly reported (
The FR 2085's supporting schedules would provide additional information needed to analyze certain financial statement line items and can be broadly grouped as those related to (1) investments, (2) insurance, and (3) other financial data. A summary of the proposed information to be collected in the supporting schedules is set forth below.
Proposed supporting schedules related to investments include: IRC-B Securities and Other Invested Assets; IRC-C Loans and Lease Financing Receivables; IRI-B Charge-Offs, Recoveries and Changes in Allowance for Loan and Lease Losses; IRC-D Trading Assets and Liabilities; and IRC-L Derivatives and Off-Balance-Sheet Items.
This schedule collects consolidated information about fixed maturity securities, equity securities and other “invested assets” grouped by classification as held-to-maturity, available-for-sale, or fair value option. Fixed maturity and equity securities classified as trading in accordance with ASC 320,
The FR 2085 leverages many of the data definitions from the FR Y-9C because the types of investments of insurance nonbank financial companies and holding companies are similar. Maintaining this consistency would allow for aggregation of data across institutions.
The schedule was, however, tailored to gather additional detailed balances for certain investment categories that are more significant or unique to insurance companies. These categories include fixed maturity securities issued by foreign governments, municipalities, and corporations, as well as equity securities and other invested assets. These data would be used to monitor exposures to these types of investments over time at each insurance nonbank financial company as well as across companies.
Given the significance of an insurance company's fixed maturity portfolio in its investment program and ability to hold sub-investment grade securities, it is important for the Board to understand the underlying credit quality of insurance nonbank financial companies' fixed maturity investments. Because section 939A of the Dodd-Frank Act requires the Federal Reserve to remove references to credit ratings from its regulations, fixed maturity securities are separately listed as investment grade or sub-investment grade based on the firm's internal credit rating system.
Because insurance nonbank financial companies participate and provide
In addition to the loans an insurance company has extended, high-level indicators of credit quality are also necessary to understand the content of insurance companies' loan portfolios. Specifically, data concerning past due and nonaccrual loans are indicative of the rate of improvement or deterioration of an insurance nonbank financial company's loan portfolio; troubled debt restructurings data give a more complete picture of the credit health of the loan portfolio; and loan-to-value ratios provide a snapshot of underwriting decisions and the riskiness of an insurance company's real estate loan portfolio compared to peers and over time.
This schedule collects charge-offs and recoveries by loan type as well as a roll forward of the allowance for loan and lease losses. Charge-offs and recoveries are a key input to credit and performance metrics of the loan portfolio. Additionally, aggregation of these data across the loan portfolios of all entities supervised by the Board can provide information about credit performance of certain loan classes. The allowance for loan and lease loss roll forward provides a basic explanation of the movements of the allowance as well as data items used to evaluate its adequacy.
This schedule collects total balances of an insurance company's trading assets and liabilities consisting of long and short fixed maturity securities and equities, derivatives, and other assets. Unlike the corresponding schedules in the FR Y-9C, this schedule only captures those instruments that are classified as trading and that are also held with the intent to trade. It does not include securities that are elected to be measured at fair value under the fair value option, which are to be reported in Schedule IRC-B Securities and Other Invested Assets.
For insurance companies, most instruments measured under the fair value option are not held with the intent to trade. Therefore, reporting these instruments separately from derivatives and other instruments classified as trading provides better insight into the business purpose for holding such instruments.
This schedule collects data related to derivatives types and exposures. This schedule is generally consistent with the corresponding FR Y-9C schedule. The first section includes the gross notional and fair value amounts for product types of free standing derivatives (
An embedded derivatives section is included to capture additional detail on derivatives that represent liabilities for certain insurance guarantees and contract options.
Together, these data would be used to monitor exposures at the individual firm level over time as well as across firms.
Although information about instruments designated as accounting or economic hedges would be pertinent, the collection of data on hedges may be better served through specific supervisory requests or a more detailed schedule that would be considered for a future revision to this report.
Balancing regulatory cost and burden with the needs of the supervisory teams for these data has been a fundamental consideration in the development of the proposed insurance-related schedules. This balance is important, as the proposed schedules may be expanded in the future to support any regulatory capital requirements that the Federal Reserve may propose for insurance nonbank financial companies. For example, more granular data may be needed for insurance-related liabilities.
Proposed supporting schedules related to insurance include: IRC-I Section I Property and Casualty, IRI-C Property and Casualty Underwriting, IRC-I Section II Life and Health, and IRC-I Section III Reinsurance Assets.
This schedule collects property and casualty reserves in a standardized way that allows for key risk exposures to be monitored over time and potentially across other property and casualty insurance companies. Three items related to property and casualty reserves are reported by line of business: Gross reserves, reported gross reserves (may be different due to discounted reserves), and reported net reserves. These three items together provide an understanding of the types of insurance exposure on an insurance nonbank financial company's balance sheet. Both gross and net reserves are required to allow for a high-level view of the impact of reinsurance and insight into the volatility of reinsurance recoverables. In addition, data for discounted and undiscounted reserves facilitates comparability of insurance companies' reserve balances, as U.S. GAAP discounting practices can vary.
This schedule also contains a roll forward of the total property and casualty insurance reserves balance from the prior year, which is necessary to understand the movement in the overall reserves balance.
The proposed lines of business are representative of the major categories of property and casualty products written in the United States and internationally. The lines of business defined by the National Association of Insurance Commissioners (NAIC) were leveraged where possible, but in some cases lines of business were combined to reduce regulatory burden. In addition, NAIC lines of business do not capture international business to the extent necessary for the Federal Reserve's supervision of the insurance nonbank financial companies. Therefore, proposed lines of business on this schedule differ from the NAIC's lines of business.
This schedule collects financial data to calculate the loss ratio, expense ratio, and combined ratio. These ratios, of incurred losses, underwriting expenses, and their sum relative to earned premium, are the most widely used metrics for analyzing property and casualty underwriting profitability.
Schedule IRI-C breaks out catastrophe losses to enable comparative and trend analysis of loss ratios with and without volatile catastrophe losses. Existing definitions of catastrophe losses can vary from firm to firm or even year to year within the same firm. Thus, to facilitate meaningful analysis, a consistent definition is needed. After considering several alternate definitions, a definition based on estimated industry losses of one billion dollars is proposed. This proposed threshold would reduce distortive annual loss volatility from low frequency/high severity events without having a large number of events declared catastrophes, which could increase the burden of reporting. Although events with industry losses approximately at the cutoff are unlikely, insurance nonbank financial companies would have the discretion to identify them in the Notes section of the report.
This schedule also separately covers current accident year losses and prior year development to better understand how changing estimates affect profitability.
The ratios are reported both gross and net of reinsurance. The gross ratio is indicative of the overall book of business underwritten by the firm while the net ratio reflects profits from its insurance operations. Comparison of gross and net ratios measure the financial and risk mitigating effect of the reporter's use of reinsurance.
In addition to the information needed to calculate the key ratios, this schedule also collects written premium information. This information would provide one indication of an insurance nonbank financial company's growth. Significant growth or declines in business can be important indicators of overall financial health and potential threats to safety and soundness.
The proposed schedules capture data for insurance-related liabilities and relevant balance sheet line items—such as Deferred Acquisition Cost (DAC), Value of Business Acquired (VOBA) and balances of Closed Block businesses
The proposed lines of business are representative of the major categories of life insurance, annuity, and accident and health products written in the United States and internationally. The existing NAIC lines of business were not used because it was determined that they do not align well with current product offerings or provide enough granularity with respect to product risks. Instead, lines of business were defined at a level to group products that share similar risk characteristics.
These schedules roll forward the insurance-related liability balances of future policyholder benefits as well as policyholder account balances by line of business. The schedules would provide supervisors with the detail required to understand the drivers of changes in liability balances and at a high level to gauge how business lines are performing and how management estimates are evolving.
This schedule captures a breakdown of contract and guarantee rider liability balances by guarantee type as well as a net amount at risk, which is a basic measure of exposure for this type of liability. Obtaining this information is important because the level, variability, and drivers of risk differ significantly by guarantee type.
This schedule collects information related to policies and contracts issued prior to the demutualization of an insurance company. Collecting standardized data in the FR 2085 allows the Federal Reserve to monitor closed blocks of business and their impact on the financial flexibility and liquidity of insurance nonbank financial companies, where applicable.
This schedule is complementary to Parts A and B above and is necessary to assess the activity and performance of lines of business, including as an indicator of when and where negative experience may be emerging and when a firm's expectation of future profitability has changed. The lines of business proposed for the deferred acquisition costs roll forward are consistent with the insurance-related liability roll forwards.
This schedule captures material reinsurance counterparty credit risk by individual exposure. This information is necessary to monitor exposures to individual reinsurers.
The proposed form would require a limited set of information to support the financial statements outside of the areas of investments and insurance. These supporting schedules are IRC-M Memoranda and IRC-V Variable Interest Entities.
This schedule provides additional breakdowns of certain balance sheet items and general information that are not captured in other proposed schedules, such as deferred taxes and borrowings. The additional breakdowns allow for historical tracking to support trend analysis as well as comparisons across firms.
This schedule provides information concerning consolidated variable interest entities. It is important to collect data on assets and liabilities associated with variable interest entities because variable interest entities can have different legal and risk characteristics than other assets and liabilities of a firm.
The Federal Reserve sought and received informal feedback from the insurance nonbank financial companies and two actuarial trade and professional organizations (American Academy of Actuaries and Society of Actuaries) in developing this proposed report. Several outreach meetings to discuss the draft FR 2085 form and instructions took place in October and November 2015 in an effort to refine the data items in the proposed schedules and provide clear accompanying instructions.
The notificants listed below have applied under the Change in Bank Control Act (12 U.S.C. 1817(j)) and § 225.41 of the Board's Regulation Y (12 CFR 225.41) to acquire shares of a bank or bank holding company. The factors that are considered in acting on the notices are set forth in paragraph 7 of the Act (12 U.S.C. 1817(j)(7)).
The notices are available for immediate inspection at the Federal Reserve Bank indicated. The notices also will be available for inspection at the offices of the Board of Governors. Interested persons may express their views in writing to the Reserve Bank indicated for that notice or to the offices of the Board of Governors. Comments must be received not later than May 10, 2016.
A. Federal Reserve Bank of New York (Ivan Hurwitz, Vice President) 33 Liberty Street, New York, New York 10045-0001. Comments can also be sent electronically to
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Board of Governors of the Federal Reserve System.
The Board of Governors of the Federal Reserve System (Board or Federal Reserve) invites comment on a proposal to extend for three years, with revision the Annual Report of Holding Companies (FR Y-6), the Annual Report of Foreign Banking Organizations (FR Y-7), and the Report of Changes in Organizational Structure (FR Y-10). The Federal Reserve proposes to revise the FR Y-6, FR Y-7, and FR Y-10 by modifying confidential treatment questions on the reporting forms and instructions to align with the recently approved confidentiality check-box proposal.
On June 15, 1984, the Office of Management and Budget (OMB) delegated to the Board authority under the Paperwork Reduction Act (PRA) to approve of and assign OMB control numbers to collection of information requests and requirements conducted or sponsored by the Board. In exercising this delegated authority, the Board is directed to take every reasonable step to solicit comment. In determining whether to approve a collection of information, the Board will consider all comments received from the public and other agencies.
Comments must be submitted on or before June 24, 2016.
You may submit comments, identified by
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All public comments are available from the Board's Web site at:
Additionally, commenters may send a copy of their comments to the OMB Desk Officer—Shagufta Ahmed—Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Room 10235 725 17th Street NW., Washington, DC 20503 or by fax to (202) 395-6974.
A copy of the PRA OMB submission, including the proposed reporting form and instructions, supporting statement, and other documentation will be placed into OMB's public docket files, once approved. These documents will also be made available on the Federal Reserve Board's public Web site at:
Federal Reserve Board Clearance Officer—Nuha Elmaghrabi—Office of the Chief Data Officer, Board of Governors of the Federal Reserve System, Washington, DC 20551 (202) 452-3829. Telecommunications Device for the Deaf (TDD) users may contact (202) 263-4869, Board of Governors of the Federal Reserve System, Washington, DC 20551.
The Board invites public comment on the following information collection,
a. Whether the proposed collection of information is necessary for the proper performance of the Federal Reserve's functions; including whether the information has practical utility;
b. The accuracy of the Federal Reserve's estimate of the burden of the proposed information collection, including the validity of the methodology and assumptions used;
c. Ways to enhance the quality, utility, and clarity of the information to be collected;
d. Ways to minimize the burden of information collection on respondents, including through the use of automated collection techniques or other forms of information technology; and
e. Estimates of capital or start up costs and costs of operation, maintenance, and purchase of services to provide information.
FR Y-6: Section 5(c)(1)(A) of the Bank Holding Company Act (BHC Act) (12 U.S.C. 1844(c)(1)(A)); sections 8(a) and 13(a) of the International Banking Act (IBA) (12 U.S.C. 3106(a) and 3108(a)); sections 11(a)(1), 25, and 25A of the Federal Reserve Act (FRA) (12 U.S.C. 248(a)(1), 602, and 611a); and sections 113, 165, 312, 618, and 809 of the Dodd-Frank Act (12 U.S.C. 5361, 5365, 5412, 1850a(c)(1), and 5468(b)(1)), respectively.
FR Y-7: Sections 8(a) and 13(a) of the IBA (12 U.S.C. 3106(a) and 3108(a)); sections 113, 165, 312, 618, and 809 of the Dodd-Frank Act (12 U.S.C. 5361, 5365, 5412, 1850a(c)(1), and 5468(b)(1)), respectively.
FR Y-10 and FR Y-10E: Sections 4(k) and 5(c)(1)(A) of the BHC Act (12 U.S.C. 1843(k), 1844(c)(1)(A)); section 8(a) of the IBA (12 U.S.C. 3106(a)); sections 11(a)(1), 25(7), and 25A of the FRA (12 U.S.C. 248(a)(1), 321, 601, 602, 611a, 615, and 625); sections 113, 165, 312, 618, and 809 of the Dodd-Frank Act (12 U.S.C. 5361, 5365, 5412, 1850a(c)(1), and 5468(b)(1)); and section 10(c)(2)(H) of the Home Owners' Loan Act (12 U.S.C. 1467a(c)(2)(H)), respectively.
The data collected in the FR Y-6, FR Y-7, FR Y-10, and FR Y-10E are not considered confidential. With regard to information that a banking organization may deem confidential, the institution may request confidential treatment of such information under one or more of the exemptions in the Freedom of Information Act (FOIA) (5 U.S.C. 552). The most likely case for confidential treatment will be based on FOIA exemption 4, which permits an agency to exempt from disclosure “trade secrets and commercial or financial information obtained from a person and privileged and confidential” (5 U.S.C. 552(b)(4)). To the extent an institution can establish the potential for substantial competitive harm, such information would be protected from disclosure under the standards set forth in
The Federal Reserve proposes that the disclosure of the responses to the certification questions may interfere with home-country regulators' administration, execution, and disclosure of their stress-test regime and its results, and may cause substantial competitive harm to the FBO providing the information, and thus this information may be protected from disclosure under FOIA exemption 4.
The FR Y-7 is an annual information collection submitted by qualifying FBOs to update their financial and organizational information with the Federal Reserve. The FR Y-7 collects financial, organizational, shareholder, and managerial information. The Federal Reserve uses the information to assess an FBO's ability to be a continuing source of strength to its U.S. operations and to determine compliance with U.S. laws and regulations.
The FR Y-10 is an event-generated information collection submitted by FBOs; top-tier HCs; securities holding companies as authorized under Section 618 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act) (12 U.S.C. 1850a(c)(1)); state member banks unaffiliated with a bank holding company (BHC); Edge and agreement corporations that are not controlled by a member bank, a domestic BHC, or an FBO; and nationally chartered banks that are not controlled by a BHC (with regard to their foreign investments only), to capture changes in their regulated investments and activities. The Federal Reserve uses the data to monitor structure information on subsidiaries and regulated investments of these entities engaged in banking and nonbanking activities. The FR Y-10E is a free-form supplement that may be used to collect additional structural information deemed to be critical and needed in an expedited manner.
Detailed description of proposed changes.
On the Banking and Nonbanking Schedules, the Federal Reserve proposes to add to the company type “IHCs.” Banking Schedule item 5, “Fiscal Year End,” would be revised to be applicable to IHCs. Additionally, on the Nonbanking Schedule, a new item “Fiscal Year End” would be added to allow for reporting IHCs that do not control a U.S. insured depository institution. The new item would be item 5 and current items 4 and 5 would be renumbered to 4.a and 4.b, respectively.
On the Banking and Nonbanking Schedules, the Federal Reserve proposes to add examples for “Date of Event” in the instructions to provide guidance to IHC reporting.
The Federal Reserve proposes to add a formula to calculate ownership percentage control for Report Item 3. The formula is used by the Federal Reserve when calculating control. Inclusion of the formula would help to standardize information received.
Also in the General Instructions, the Federal Reserve proposes to remove the paragraph under “What is the Legal Authority for the FR Y-10?” This change will align the reporting instructions with other forms and instructions, which provide the legal authority on the form.
In the Banking, Savings and Loan, and Nonbanking Schedules instructions, the Federal Reserve proposes to clarify conditions under which sole partnership and sole member LLCs are reportable. Institutions often report incorrectly. The clarification would result in fewer revisions, thereby reducing overall burden.
The Federal Reserve proposes to rephrase the description of section 10(c)(6)(B) in Legal Authority Code (LAC) 412 and create a new LAC for section 10(c)(9)(C) to clearly identity which exemption SLHCs are claiming as a grandfathered unitary SLHC.
The Federal Reserve also proposes to add definitions to the FR Y-10 Glossary for the following terms: Grandfathered Unitary Savings and Loan Holding Company, Insured Depository Institution, and U.S. Intermediate Holding Company.
In the Nonbanking Schedule instructions, the Federal Reserve proposes to add a note to clarify that a nonbank subsidiary under a savings association does not meet the definition of a financial subsidiary.
The Federal Reserve proposes to update the Merger Schedule instructions to indicate that the popular name of the branch (for example, when the branch was formerly the head office of the nonsurvivor) must be reported on the Domestic Branch Schedule. Respondents often forget to report this information.
Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
Notice of request for comments regarding the extension of a previously existing OMB clearance.
Under the provisions of the Paperwork Reduction Act, Regulatory Secretariat Division will be submitting to the Office of Management and Budget (OMB) a request to review and approve an extension of a previously approved information collection requirement concerning Department of Commerce patent regulations.
Submit comments on or before June 24, 2016.
Submit comments identified by Information Collection 9000-0095, Commerce Patent Regulations, by any of the following methods:
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Mr. Edward Loeb, Procurement Analyst, Office of Governmentwide Acquisition Policy, GSA, 202-501-0650 or email
FAR subpart 27.3, Patents Rights under Government Contracts, implements the Department of Commerce regulation (37 CFR 401) based on chapter 18 of title 35 U.S.C., Presidential Memorandum on Government Patent Policy to the Heads of Executive Departments and Agencies, dated February 18, 1983, and Executive Order 12591, Facilitating Access to Science and Technology, dated April 10, 1987. Under the subpart, a contracting officer may insert clauses 52.227-11, Patent Rights-Ownership by the Contractor, or 52.227-13, Patent Rights-Ownership by the Government, in solicitations and contracts pertaining to inventions made in the performance of experimental, developmental, or research work.
In accordance with the clauses, a Government contractor must report all subject inventions to the contracting officer, submit a disclosure of the invention, and identify any publication, or sale, or public use of the invention (52.227-11(c), 52.227-13(e)(1)). The contracting officer may modify 52.227-11(e) or otherwise supplement the clause to require contractors to submit periodic or interim and final reports listing subject inventions (27.303(b)(2)(i) and (ii)). In order to ensure that subject inventions are reported, the contractor is required to establish and maintain effective procedures for identifying and disclosing subject inventions (52.227-11, Alternate IV; 52.227-13(e)(1)). In addition, the contractor must require his employees, by written agreements, to disclose subject inventions (52.227-11(e)(2); 52.227-13(e)(4)). The contractor also has an obligation to utilize the subject invention, and agree to report, upon request, the utilization or efforts to utilize the subject invention (27.302(e); 52.227-11(f)).
Public comments are particularly invited on: Whether this collection of information is necessary for the proper performance of functions of the FAR, and whether it will have practical utility; whether our estimate of the public burden of this collection of information is accurate, and based on valid assumptions and methodology; ways to enhance the quality, utility, and clarity of the information to be collected; and ways in which we can minimize the burden of the collection of information on those who are to respond, through the use of appropriate technological collection techniques or other forms of information technology.
Department of Defense (DOD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
Notice of request for comments regarding the extension to an existing OMB clearance.
Under the provisions of the Paperwork Reduction Act, Regulatory Secretariat Division will be submitting to the Office of Management and Budget (OMB) a request to review and approve an extension of a previously approved information collection requirement concerning Bankruptcy.
Submit comments on or before June 24, 2016.
Submit comments identified by Information Collection 9000-0108, Bankruptcy, by any of the following methods:
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Curtis E. Glover, Sr., Procurement Analyst, Contract Policy Division, GSA, 202-501-1448 or email
Under statute, contractors may enter into bankruptcy which may have a significant impact on the contractor's ability to perform its Government contract. The Government often does not receive adequate and timely notice of this event. The clause at 52.242-13 requires contractors to notify the contracting officer within 5 days after the contractor enters into bankruptcy.
In accordance with Section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92-463), the Centers for Disease Control and Prevention (CDC) announces a meeting for the initial review of applications in response to Funding Opportunity Announcement (FOA) PS16-006, “Early HIV Treatment to Optimize Patient Health and HIV Prevention”.
In accordance with Section 10(a)(2) of the Federal Advisory Committee Act (Pub. L. 92-463), the Centers for Disease Control and Prevention (CDC) announces a meeting for the initial review of applications in response to Funding Opportunity Announcements (FOAs) GH16-006, Conducting Public Health Research in Kenya; GH16-008, Hospital-based birth defects surveillance in Kampala, Uganda, and GH14-002, Addressing Emerging Infectious Diseases in Bangladesh.
The Director, Management Analysis and Services Office, has been delegated the authority to sign
Administration for Community Living, HHS.
Notice.
The Administration for Community Living (ACL) announces the intent to award a supplemental single-source cooperative agreement in the amount of $275,000 to the University of Southern (U.S.C.) California, Department of Family Medicine and Geriatrics, National Center on Elder Abuse (NCEA) to support and stimulate the expansion of work already underway by U.S.C./NCEA proving public awareness and improving the national response to elder abuse, neglect and exploitation to all.
The award will be issued for the project period to run concurrently with the existing grantee's budget period of September 30, 2015 through September 29, 2016.
Aiesha Gurley, Office of Elder Justice and Adult Protective Services, Administration on Aging, Administration for Community Living, 330 C Street SW., Washington, DC 20024.
The ACL National Center on Elder Abuse serves as a national resource center dedicated to the prevention of elder mistreatment. The NCEA disseminates elder abuse information to professionals and the public, and provides technical assistance and training to states and to community-based organizations. NCEA is unique because it operates as a multi-disciplinary consortium of equal partners with expertise in elder abuse, neglect, and exploitation. They serve as a national clearinghouse of information for elder rights advocates, law enforcement, legal professionals, public policy leaders, researchers, and others working to ensure that all older Americans will live with dignity, integrity, independence, and without abuse, neglect, and exploitation.
Additional funds are needed to leverage the resource center's funding for elder abuse awareness through social media and creating state leadership networks through targeted campaigns that will assist states in spreading awareness. This supplementary funding would be provided for the approved period.
This program is authorized under Title II of the Older Americans Act Section 202(d)(2) which establishes the requirements for the National Center for Elder Abuse.
Food and Drug Administration, HHS.
Notice of availability.
The Food and Drug Administration (FDA or Agency) is announcing the availability of a revised draft guidance for industry entitled “Assay Development and Validation for Immunogenicity Testing of Therapeutic Protein Products.” This guidance provides recommendations to facilitate industry's development and validation of immune assays for assessment of the immunogenicity of therapeutic protein products during clinical trials. The guidance for assay development and validation provided in this document applies to assays for detection of anti-drug antibodies (ADA). This document includes guidance regarding the development and validation of screening assays, confirmatory assays, titering assays, and neutralization assays. This guidance revises the draft guidance for industry entitled “Assay Development for Immunogenicity Testing of Therapeutic Proteins” issued in December 2009. This revised draft guidance includes new information on titering and confirmatory assays.
Although you can comment on any guidance at any time (see 21 CFR 10.115(g)(5)), to ensure that the Agency considers your comment on this revised draft guidance before it begins work on the final version of the guidance, submit either electronic or written comments on the revised draft guidance by June 24, 2016.
You may submit comments as follows:
Submit electronic comments in the following way:
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• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
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• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
• Confidential Submissions—To submit a comment with confidential information that you do not wish to be made publicly available, submit your comments only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on
Submit written requests for single copies of the revised draft guidance to the Division of Drug Information, Center for Drug Evaluation and Research, Food and Drug Administration, 10001 New Hampshire Ave., Hillandale Building, 4th Floor, Silver Spring, MD 20993-0002; or the Office of Communication, Outreach, and Development, Center for Biologics Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 71, Rm. 3128, Silver Spring, MD 20993-0002; or the Office of the Center Director, Guidance and Policy Development, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. 5431, Silver Spring, MD 20993-0002. Send one self-addressed adhesive label to assist that office in processing your requests. See the
Ebla Ali Ibrahim, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 51, Rm. 6308, Silver Spring, MD 20993, 301-796-0281; or Stephen Ripley, Center for Biologics Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 71, Rm. 7301, Silver Spring, MD 20993-0002, 240-402-7911; or Peter Hudson, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. G434 (HFZ-410), Silver Spring, MD, 20993-0002, 301-796-6440.
FDA is announcing the availability of a revised draft guidance for industry entitled “Assay Development and Validation for Immunogenicity Testing of Therapeutic Protein Products.” Patient immune responses to therapeutic protein products have the potential to affect product safety and efficacy. The clinical effects of patient immune responses are highly variable, ranging from no effect at all to extreme harmful effects to patient health. Detection and analysis of ADA formation is a helpful tool in understanding potential patient immune responses. Information on immune responses observed during clinical trials, particularly the incidence of ADA induction and the implications of ADA responses for drug safety and efficacy, is crucial for any therapeutic product development program. Accordingly, such information, if applicable, should be included in the prescribing information as a subsection of the ADVERSE REACTIONS section entitled “Immunogenicity.”
In general, assays for detection of ADA facilitate understanding of the immunogenicity, safety, and efficacy of therapeutic protein products. However, the detection of ADA is dependent on key operating parameters of the assays (
This guidance revises the draft guidance for industry entitled “Assay Development for Immunogenicity Testing of Therapeutic Proteins” issued in December 2009. The information in the draft guidance has been reorganized for clarity, and the revised draft guidance includes new information on titering and confirmatory assays.
This revised draft guidance is being issued consistent with FDA's good guidance practices regulation (21 CFR 10.115). The revised draft guidance, when finalized, will represent the current thinking of FDA on assay development and validation for immunogenicity testing of therapeutic protein products. It does not establish any rights for any person and is not binding on FDA or the public. You can use an alternative approach if it satisfies the requirements of the applicable statutes and regulations.
This revised draft guidance refers to previously approved collections of information that are subject to review by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). The collections of information in 21 CFR part 312 have been approved under OMB control number 0910-0014; the collections of information in 21 CFR part 314 have been approved under OMB control numbers 0910-0001 and 0910-0230; the collections of information in 21 CFR part 58 have been approved under OMB control number 0910-0119; and the collections of information in 21 CFR part 601 have been approved under OMB control numbers 0910-0338 and 0910-0719.
Persons with access to the Internet may obtain the document at
Food and Drug Administration, HHS.
Notice.
The Food and Drug Administration (FDA or Agency) has determined that THALITONE (chlorthalidone USP) tablets, 15 milligrams (mg), were not withdrawn from sale for reasons of safety or effectiveness. This determination will allow FDA to approve abbreviated new drug applications (ANDAs) for
Christopher Koepke, Center for Drug Evaluation and Research, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 51, Rm. 6214, Silver Spring, MD 20993-0002, 240-402-3543.
In 1984, Congress enacted the Drug Price Competition and Patent Term Restoration Act of 1984 (Pub. L. 98-417) (the 1984 amendments), which authorized the approval of duplicate versions of drug products under an ANDA procedure. ANDA applicants must, with certain exceptions, show that the drug for which they are seeking approval contains the same active ingredient in the same strength and dosage form as the “listed drug,” which is a version of the drug that was previously approved. ANDA applicants do not have to repeat the extensive clinical testing otherwise necessary to gain approval of a new drug application (NDA).
The 1984 amendments include what is now section 505(j)(7) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355(j)(7)), which requires FDA to publish a list of all approved drugs. FDA publishes this list as part of the “Approved Drug Products With Therapeutic Equivalence Evaluations,” which is known generally as the “Orange Book.” Under FDA regulations, drugs are removed from the list if the Agency withdraws or suspends approval of the drug's NDA or ANDA for reasons of safety or effectiveness or if FDA determines that the listed drug was withdrawn from sale for reasons of safety or effectiveness (21 CFR 314.162).
A person may petition the Agency to determine, or the Agency may determine on its own initiative, whether a listed drug was withdrawn from sale for reasons of safety or effectiveness. This determination may be made at any time after the drug has been withdrawn from sale, but must be made prior to approving an ANDA that refers to the listed drug (§ 314.161 (21 CFR 314.161)). FDA may not approve an ANDA that does not refer to a listed drug.
THALITONE (chlorthalidone USP) tablets, 15 mg, are the subject of NDA 19-574, held by Citron Pharma LLC, and initially approved on December 20, 1988. THALITONE is indicated for the management of hypertension either alone or in combination with other antihypertensive drugs. Chlorthalidone is indicated as an adjunctive therapy in edema associated with congestive heart failure, hepatic cirrhosis, and corticosteroid and estrogen therapy. Chlorthalidone has also been found useful in edema due to various forms of renal dysfunction such as nephrotic syndrome, acute glomerulonephritis, and chronic renal failure.
THALITONE (chlorthalidone USP) tablets, 15 mg, are currently listed in the “Discontinued Drug Product List” section of the Orange Book.
Clinipace Worldwide submitted a citizen petition dated September 9, 2015 (Docket No. FDA-2015-P-3299), under 21 CFR 10.30, requesting that the Agency determine whether THALITONE (chlorthalidone USP) tablets, 15 mg, were withdrawn from sale for reasons of safety or effectiveness.
After considering the citizen petition and reviewing Agency records and based on the information, FDA has determined under § 314.161 that THALITONE (chlorthalidone USP) tablets, 15 mg, were not withdrawn for reasons of safety or effectiveness. The petitioner has identified no data or other information suggesting that THALITONE (chlorthalidone USP) tablets, 15 mg, were withdrawn for reasons of safety or effectiveness. We have carefully reviewed our files for records concerning the withdrawal of THALITONE (chlorthalidone USP) tablets, 15 mg, from sale. We have also independently evaluated relevant literature and data for possible postmarketing adverse events. We have reviewed the available evidence and determined that this drug product was not withdrawn from sale for reasons of safety or effectiveness.
Accordingly, the Agency will continue to list THALITONE (chlorthalidone USP) tablets, 15 mg, in the “Discontinued Drug Product List” section of the Orange Book. The “Discontinued Drug Product List” delineates, among other items, drug products that have been discontinued from marketing for reasons other than safety or effectiveness. ANDAs that refer to THALITONE (chlorthalidone USP) tablets, 15 mg, may be approved by the Agency as long as they meet all other legal and regulatory requirements for the approval of ANDAs. If FDA determines that labeling for this drug product should be revised to meet current standards, the Agency will advise ANDA applicants to submit such labeling.
Indian Health Service, HHS.
Notice and request for comments. Request for extension of approval.
In compliance the Paperwork Reduction Act of 1995, the Indian Health Service (IHS) invites the general public to comment on the information collection titled, “Indian Self-Determination and Education Assistance Act Contracts,” Office of Management and Budget (OMB) Control Number 0917-0037. IHS is requesting OMB to approve an extension for this collection, which expires on July 31, 2016.
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Send your written comments, requests for more information on the collection, or requests to obtain a copy of the data collection instrument and instructions to Mr. Chris Buchanan by one of the following methods:
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This previously approved information collection project was last published in the
Representatives of the IHS seek renewal of the approval for information collections conducted under 25 CFR part 900, implementing the Indian Self-Determination and Education Assistance Act (ISDEAA), as amended (25 U.S.C. 450
The information requirements for this rule represent significant differences from other agencies in several respects. Under the Act, the Secretary of Health and Human Services is directed to enter into self-determination contracts with Tribes upon request, unless specific declination criteria apply, and, generally, Tribes may renew these contracts annually, whereas other agencies provide grants on a discretionary or competitive basis. Additionally, IHS awards contracts for multiple programs whereas other agencies usually award single grants to Tribes.
The IHS uses the information collected to determine applicant eligibility, evaluate applicant capabilities, protect the service population, safeguard Federal funds and other resources, and permit the Federal agency to administer and evaluate contract programs. Tribal governments or Tribal organizations provide the information by submitting contract proposals, and related information, to the IHS, as required under Public Law 93-638. No third party notification or public disclosure burden is associated with this collection.
The IHS requests your comments on this collection concerning: (a) The necessity of this information collection for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency's estimate of the burden (hours and cost) of the collection of information, including the validity of the methodology and assumptions used; (c) ways we could enhance the quality, utility, and clarity of the information to be collected; and (d) ways we could minimize the burden of the collection of the information on the respondents.
Please note that an agency may not conduct or sponsor, and an individual need not respond to, a collection of information unless it displays a valid OMB Control Number.
It is our policy to make all comments available to the public for review at the location listed in the
Pursuant to section 10(a) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of a meeting of the Advisory Committee to the Director, National Institutes of Health.
The meeting will be open to the public, with attendance limited to space available. Individuals who plan to attend and need special assistance, such as sign language interpretation or other reasonable accommodations, should notify the Contact Person listed below in advance of the meeting.
Any interested person may file written comments with the committee by forwarding the statement to the Contact Person listed on this notice. The statement should include the name, address, telephone number and when applicable, the business or professional affiliation of the interested person.
In the interest of security, NIH has instituted stringent procedures for entrance onto the NIH campus. All visitor vehicles, including taxicabs, hotel, and airport shuttles will be inspected before being allowed on campus. Visitors will be asked to show one form of identification (for example, a government-issued photo ID, driver's license, or passport) and to state the purpose of their visit.
Information is also available on the Institute's/Center's home page:
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and contract proposal discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications or contract proposal, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of a meeting of the National Advisory Child Health and Human Development Council.
The meeting will be open to the public as indicated below, with attendance limited to space available. A portion of this meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended for the review and discussion of grant applications. Individuals who plan to attend and need special assistance, such as sign language interpretation or other reasonable accommodations, should notify the contact person listed below in advance of the meeting.
Any interested person may file written comments with the committee by forwarding the statement to the contact person listed on this notice. The statement should include the name, address, telephone number, and when applicable, the business or professional affiliation of the interested person.
In the interest of security, NIH has instituted stringent procedures for entrance onto the NIH campus. All visitor vehicles, including taxis, hotel, and airport shuttles, will be inspected before being allowed on campus. Visitors will be asked to show one form of identification (for example, a government-issued photo ID, driver's license, or passport) and to state the purpose of their visit.
In order to facilitate public attendance at the open session of Council in the main meeting room, Conference Room 6, please contact Ms. Lisa Kaeser, Program and Public Liaison Office, NICHD, at 301-496-0536 to make your reservation, additional seating will be available in the meeting overflow rooms, Conference Rooms 7 and 8. Individuals will also be able to view the meeting via NIH Videocast. Please go to the following link for Videocast access instructions at:
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of a meeting of the National Advisory Council for Complementary and Integrative Health.
The meeting will be open to the public as indicated below, with attendance limited to space available. Individuals who plan to attend and need special assistance, such as sign language interpretation or other reasonable accommodations, should notify the Contact Person listed below in advance of the meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Closed: 8:30 a.m. to 9:45 a.m.
Open: 10:00 a.m. to 3:30 p.m.
Any interested person may file written comments with the committee by forwarding the statement to the Contact Person listed on this notice. The statement should include the name, address, telephone number and when applicable, the business or professional affiliation of the interested person.
In the interest of security, NIH has instituted stringent procedures for entrance onto the NIH campus. All visitor vehicles, including taxicabs, hotel, and airport shuttles will be inspected before being allowed on campus. Visitors will be asked to show one form of identification (for example, a government-issued photo ID, driver's license, or passport) and to state the purpose of their visit.
Information is also available on the Institute's/Center's home page:
This notice announces the next meeting of the National Toxicology Program (NTP) Board of Scientific Counselors (BSC). The BSC, a federally chartered, external advisory group composed of scientists from the public and private sectors, will review and provide advice on programmatic activities. The meeting is open to the public and registration is requested for both attendance and oral comment and required to access the webcast. Information about the meeting and registration are available at
Meeting: June 15-16, 2016; it begins at 8:30 a.m. Eastern Daylight Time (EDT) on both days and continues until adjournment.
Dr. Lori White, Designated Federal Officer for the BSC, Office of Liaison, Policy and Review, Division of NTP, NIEHS, P.O. Box 12233, K2-03, Research Triangle Park, NC 27709. Phone: 919-541-9834, Fax: 301-480-3272, Email:
The BSC will provide input to the NTP on programmatic activities and issues. Preliminary agenda topics include: Reports from the NIEHS/NTP Director and the NTP Associate Director, an update on NTP activities at the National Center for Toxicological Research, a report on the peer review of NTP Technical Reports on antimony trioxide and TRIM® VX, a report on the peer review of the Report on Carcinogens monographs on selected viruses, a research concept on thallium compounds, updates on NTP testing and the synthetic turf/crumb rubber research program, a report on projects utilizing the NIEHS Clinical Research Unit, and reports on three recent workshops (1)
The preliminary agenda, roster of BSC members, background materials, public comments, and any additional information, when available, will be posted on the BSC meeting Web site (
The public may attend the meeting in person or view the webcast. Registration is required to view the webcast; the URL for the webcast will be provided in the email confirming registration. Individuals who plan to provide oral comments (see below) are encouraged to register online at the BSC meeting Web site (
Request for Comments: Written comments submitted in response to this notice should be received by June 1, 2016. Comments will be posted on the BSC meeting Web site and persons submitting them will be identified by their name and affiliation and/or sponsoring organization, if applicable. Persons submitting written comments should include their name, affiliation (if applicable), phone, email, and sponsoring organization (if any) with the document. Guidelines for public comments are at
Time is allotted during the meeting for the public to present oral comments to the BSC on the agenda topics. Public comments can be presented in-person at the meeting or by teleconference line. There are 50 lines for this call; availability is on a first-come, first-served basis. The lines will be open from 8:30 a.m. until adjournment on June 15 and 16, although the BSC will receive public comments only during the formal public comment periods, which are indicated on the preliminary agenda. Each organization is allowed one time slot per agenda topic. Each speaker is allotted at least 7 minutes, which if time permits, may be extended to 10 minutes at the discretion of the BSC chair. Persons wishing to present oral comments should register on the BSC meeting Web site by June 8, 2016, indicate whether they will present comments in-person or via the teleconference line, and indicate the topic(s) on which they plan to comment. The access number for the teleconference line will be provided to registrants by email prior to the meeting. On-site registration for oral comments will also be available on the meeting day, although time allowed for comments by these registrants may be limited and will be determined by the number of persons who register at the meeting.
Persons registering to make oral comments are asked to send a copy of their statement and/or PowerPoint slides to the Designated Federal Officer by June 8, 2016. Written statements can supplement and may expand upon the oral presentation. If registering on-site and reading from written text, please bring 20 copies of the statement for distribution to the BSC and NTP staff and to supplement the record.
Background Information on the BSC: The BSC is a technical advisory body comprised of scientists from the public and private sectors that provides primary scientific oversight to the NTP. Specifically, the BSC advises the NTP on matters of scientific program content, both present and future, and conducts periodic review of the program for the purpose of determining and advising on the scientific merit of its activities and their overall scientific quality. Its members are selected from recognized authorities knowledgeable in fields such as toxicology, pharmacology, pathology, biochemistry, epidemiology, risk assessment, carcinogenesis,
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Federal Emergency Management Agency, DHS.
Notice.
Comments are requested on proposed flood hazard determinations, which may include additions or modifications of any Base Flood Elevation (BFE), base flood depth, Special Flood Hazard Area (SFHA) boundary or zone designation, or regulatory floodway on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports for the communities listed in the table below. The purpose of this notice is to seek general information and comment regarding the preliminary FIRM, and where applicable, the FIS report that the Federal Emergency Management Agency (FEMA) has provided to the affected communities. The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report, once effective, will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings.
Comments are to be submitted on or before July 25, 2016.
The Preliminary FIRM, and where applicable, the FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
You may submit comments, identified by Docket No. FEMA-B-1613, to Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
FEMA proposes to make flood hazard determinations for each community listed below, in accordance with section 110 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
These proposed flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities. These flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings built after the FIRM and FIS report become effective.
The communities affected by the flood hazard determinations are provided in the tables below. Any request for reconsideration of the revised flood hazard information shown on the Preliminary FIRM and FIS report that satisfies the data requirements outlined in 44 CFR 67.6(b) is considered an appeal. Comments unrelated to the flood hazard determinations also will be considered before the FIRM and FIS report become effective.
Use of a Scientific Resolution Panel (SRP) is available to communities in support of the appeal resolution process. SRPs are independent panels of experts in hydrology, hydraulics, and other pertinent sciences established to review conflicting scientific and technical data and provide recommendations for resolution. Use of the SRP only may be exercised after
The watersheds and/or communities affected are listed in the tables below. The Preliminary FIRM, and where applicable, FIS report for each community are available for inspection at both the online location and the respective Community Map Repository address listed in the tables. For communities with multiple ongoing Preliminary studies, the studies can be identified by the unique project number and Preliminary FIRM date listed in the tables. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
I. Watershed-based studies:
II. Non-watershed-based studies:
Federal Emergency Management Agency, DHS.
Final notice.
New or modified Base (1-percent annual chance) Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, and/or regulatory floodways (hereinafter referred to as flood hazard determinations) as shown on the indicated Letter of Map Revision (LOMR) for each of the communities listed in the table below are finalized. Each LOMR revises the Flood Insurance Rate Maps (FIRMs), and in some cases the Flood Insurance Study (FIS) reports, currently in effect for the listed communities. The flood hazard determinations modified by each LOMR will be used to calculate flood insurance premium rates for new buildings and their contents.
The effective date for each LOMR is indicated in the table below.
Each LOMR is available for inspection at both the respective Community Map Repository address listed in the table below and online through the FEMA Map Service Center at
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The Federal Emergency Management Agency (FEMA) makes the final flood hazard determinations as shown in the LOMRs for each community listed in the table below. Notice of these modified flood hazard determinations has been published in newspapers of local circulation and 90 days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
The modified flood hazard determinations are made pursuant to section 206 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
For rating purposes, the currently effective community number is shown and must be used for all new policies and renewals.
The new or modified flood hazard information is the basis for the floodplain management measures that the community is required either to adopt or to show evidence of being already in effect in order to remain qualified for participation in the National Flood Insurance Program (NFIP).
This new or modified flood hazard information, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or pursuant to policies established by other Federal, State, or regional entities.
This new or modified flood hazard determinations are used to meet the floodplain management requirements of the NFIP and also are used to calculate the appropriate flood insurance premium rates for new buildings, and for the contents in those buildings. The changes in flood hazard determinations are in accordance with 44 CFR 65.4.
Interested lessees and owners of real property are encouraged to review the final flood hazard information available at the address cited below for each community or online through the FEMA Map Service Center at
Federal Emergency Management Agency, DHS.
Committee Management; Notice of Federal Advisory Committee meeting.
The Federal Emergency Management Agency (FEMA) National Advisory Council (NAC) will meet in person on May 10, 11, and 12, 2016 in San Antonio, TX. The meeting will be open to the public.
The NAC will meet on Tuesday, May 10, 2016, from 9:00 a.m. to 2:30 p.m., on Wednesday, May 11, 2016 from 8:30 a.m. to 5:30 p.m., and on Thursday, May 12 from 8:30 a.m. to 10:20 a.m. Central Daylight Time (CDT). Please note that the meeting may close early if the NAC has completed its business.
The meeting will be held at The Menger Hotel located at 204 Alamo Plaza in San, Antonio, TX 78205. It is recommended that attendees register with FEMA prior to the meeting by providing your name, telephone number, email address, title, and organization to the person listed in
For information on facilities or services for individuals with disabilities or to request special assistance at the meeting, contact the person listed in
To facilitate public participation, members of the public are invited to provide written comments on the issues to be considered by the NAC. The “Agenda” section below outlines these
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A public comment period will be held on Wednesday, May 11 from 2:50 p.m. to 3:10 p.m. CDT. All speakers must limit their comments to 3 minutes. Comments should be addressed to the committee. Any comments not related to the agenda topics will not be considered by the NAC. To register to make remarks during the public comment period, contact the individual listed below by May 9, 2016. Please note that the public comment period may end before the time indicated, following the last call for comments.
Alexandra Woodruff, Designated Federal Officer, Office of the National Advisory Council, Federal Emergency Management Agency, 500 C Street SW., Washington, DC 20472-3184, telephone (202) 646-2700, fax (540) 504-2331, and email
Notice of this meeting is given under the Federal Advisory Committee Act, 5 U.S.C. Appendix.
The NAC advises the FEMA Administrator on all aspects of emergency management. The NAC incorporates state, local, and tribal government, and private sector input in the development and revision of FEMA plans and strategies. The NAC includes a cross-section of senior officials, emergency managers, and emergency response providers from state, local, and tribal governments, the private sector, and nongovernmental organizations.
On Wednesday, May 11, the NAC will hear from a FEMA Regional Administrator about activities in the FEMA Regions and engage in an open discussion with the FEMA Administrator. The three NAC subcommittees (Federal Insurance and Mitigation Subcommittee, Preparedness and Protection Subcommittee, and Response and Recovery Subcommittee) and the Spontaneous Volunteers Ad Hoc Subcommittee will provide reports to the NAC about their work, whereupon the NAC will deliberate on any recommendations presented in the subcommittees' reports, and, if appropriate, vote on recommendations for the FEMA Administrator. The subcommittee reports will be posted on the NAC Web page by 8:30 a.m. on Wednesday, May 11. The NAC will receive a briefing about Supply Chain Resiliency and engage in a facilitated discussion of the status of previously submitted NAC recommendations.
On Thursday, May 12, the NAC will review agreed upon recommendations and confirm charges for the subcommittees as well as engage in an open discussion with the FEMA Deputy Administrator.
The full agenda and any related documents for this meeting will be posted by Friday, May 6 on the NAC Web site at
Federal Emergency Management Agency, DHS.
Final notice.
Flood hazard determinations, which may include additions or modifications of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or regulatory floodways on the Flood Insurance Rate Maps (FIRMs) and where applicable, in the supporting Flood Insurance Study (FIS) reports have been made final for the communities listed in the table below.
The FIRM and FIS report are the basis of the floodplain management measures that a community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the Federal Emergency Management Agency's (FEMA's) National Flood Insurance Program (NFIP). In addition, the FIRM and FIS report are used by insurance agents and others to calculate appropriate flood insurance premium rates for buildings and the contents of those buildings.
The effective date of August 17, 2016 which has been established for the FIRM and, where applicable, the supporting FIS report showing the new or modified flood hazard information for each community.
The FIRM, and if applicable, the FIS report containing the final flood hazard information for each community is available for inspection at the respective Community Map Repository address listed in the tables below and will be available online through the FEMA Map Service Center at
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The Federal Emergency Management Agency (FEMA) makes the final determinations listed below for the new or modified flood hazard information for each community listed. Notification of these changes has been published in newspapers of local circulation and 90 days have elapsed since that publication. The Deputy Associate Administrator for Mitigation has resolved any appeals resulting from this notification.
This final notice is issued in accordance with section 110 of the Flood Disaster Protection Act of 1973,
Interested lessees and owners of real property are encouraged to review the new or revised FIRM and FIS report available at the address cited below for each community or online through the FEMA Map Service Center at
The flood hazard determinations are made final in the watersheds and/or communities listed in the table below.
I. Watershed-based studies:
II. Non-watershed-based studies:
Federal Emergency Management Agency, DHS.
Notice.
This notice lists communities where the addition or modification of Base Flood Elevations (BFEs), base flood depths, Special Flood Hazard Area (SFHA) boundaries or zone designations, or the regulatory floodway (hereinafter referred to as flood hazard determinations), as shown on the Flood Insurance Rate Maps (FIRMs), and where applicable, in the supporting Flood Insurance Study (FIS) reports, prepared by the Federal Emergency Management Agency (FEMA) for each community, is appropriate because of new scientific or technical data. The FIRM, and where applicable, portions of the FIS report, have been revised to reflect these flood hazard determinations through issuance of a Letter of Map Revision (LOMR), in accordance with Title 44, Part 65 of the Code of Federal Regulations (44 CFR part 65). The LOMR will be used by insurance agents and others to calculate appropriate flood insurance premium rates for new buildings and the contents of those buildings. For rating purposes, the currently effective community number is shown in the table below and must be used for all new policies and renewals.
These flood hazard determinations will become effective on the dates listed in the table below and revise the FIRM panels and FIS report in effect prior to this determination for the listed communities.
From the date of the second publication of notification of these changes in a newspaper of local circulation, any person has 90 days in which to request through the community that the Deputy Associate Administrator for Mitigation reconsider the changes. The flood hazard determination information may be changed during the 90-day period.
The affected communities are listed in the table below. Revised flood hazard information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Submit comments and/or appeals to the Chief Executive Officer of the community as listed in the table below.
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance and Mitigation Administration, FEMA, 500 C Street SW., Washington, DC 20472, (202) 646-7659, or (email)
The specific flood hazard determinations are not described for each community in this notice. However, the online location and local community map repository address where the flood hazard determination information is available for inspection is provided.
Any request for reconsideration of flood hazard determinations must be submitted to the Chief Executive Officer of the community as listed in the table below.
The modifications are made pursuant to section 201 of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4105, and are in accordance with the National Flood Insurance Act of 1968, 42 U.S.C. 4001
The FIRM and FIS report are the basis of the floodplain management measures that the community is required either to adopt or to show evidence of having in effect in order to qualify or remain qualified for participation in the National Flood Insurance Program (NFIP).
These flood hazard determinations, together with the floodplain management criteria required by 44 CFR 60.3, are the minimum that are required. They should not be construed to mean that the community must change any existing ordinances that are more stringent in their floodplain management requirements. The community may at any time enact stricter requirements of its own or
The affected communities are listed in the following table. Flood hazard determination information for each community is available for inspection at both the online location and the respective community map repository address listed in the table below. Additionally, the current effective FIRM and FIS report for each community are accessible online through the FEMA Map Service Center at
Bureau of Indian Affairs, Interior.
Notice of request for comments.
In compliance with the Paperwork Reduction Act of 1995, the Bureau of Indian Affairs (BIA) is seeking comments on the renewal of Office of Management and Budget (OMB) approval for the collection of information for Grazing Permits authorized by OMB Control Number 1076-0157. This information collection expires October 31, 2016.
Submit comments on or before June 24, 2016.
You may submit comments on the information collection to David Edington, Office of Trust Services, 1849 C Street NW., Mail Stop 4637 MIB, Washington, DC 20240; facsimile: (202) 219-0006; email:
David Edington, (202) 513-0886.
The Bureau of Indian Affairs (BIA) is seeking renewal of the approval for the information collection conducted under 25 CFR 166, Grazing Permits, related to grazing on Tribal land, individually-owned Indian land, or government land. This information collection allows BIA to obtain the information necessary to determine whether an applicant is eligible to acquire, modify, or assign a grazing permit on trust or restricted lands and to allow a successful applicant to meet bonding requirements.
The Bureau of Indian Affairs requests your comments on this collection concerning: (a) The necessity of this information collection for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) The accuracy of the agency's estimate of the burden (hours and cost) of the collection of information, including the validity of the methodology and assumptions used; (c) Ways to enhance the quality, utility, and clarity of the information collected; and (d) Ways to minimize the burden of collecting information from respondents.
Please note that an agency may not conduct or sponsor, and an individual need not respond to, a collection of information unless it displays a valid OMB Control Number.
It is our policy to make all comments available to the public for review at the location listed in the
Bureau of Land Management, Interior.
Notice of filing of plats of survey.
The Bureau of Land Management (BLM) will file the plat of survey of the lands described below in the BLM Montana State Office, Billings, Montana, on May 25, 2016.
A notice of protest of the survey must be filed before May 25, 2016 to be considered. A statement of reasons for a protest may be filed with the notice of protest and must be filed within 30 days after the notice of protest is filed.
Protests of the survey should be sent to the Branch of Cadastral Survey, Bureau of Land Management, 5001 Southgate Drive, Billings, Montana 59101-4669.
Thomas Trzinski, Cadastral Surveyor, Branch of Cadastral Survey, Bureau of Land Management, 5001 Southgate Drive, Billings, Montana 59101-4669, telephone (406) 896-5364 or (406) 896-5003,
This survey was executed at the request of the Bureau of Indian Affairs, Great Plains Region, Aberdeen, South Dakota, and was necessary to determine individual and tribal trust lands.
The lands we surveyed are:
43 U.S.C. Chap. 3.
Bureau of Land Management, Interior.
Notice of filing of plats of survey.
The Bureau of Land Management (BLM) will file the plat of survey of the lands described below in the BLM Montana State Office, Billings, Montana, on May 25, 2016.
A notice of protest of the survey must be filed before May 25, 2016 to be considered. A statement of reasons for a protest may be filed with the notice of protest and must be filed within 30 days after the notice of protest is filed.
Protests of the survey should be sent to the Branch of Cadastral Survey, Bureau of Land Management, 5001 Southgate Drive, Billings, Montana 59101-4669.
Thomas Trzinski, Cadastral Surveyor, Branch of Cadastral Survey, Bureau of Land Management, 5001 Southgate Drive, Billings, Montana 59101-4669, telephone (406) 896-5364 or (406) 896-5003,
This survey was executed at the request of the Bureau of Indian Affairs, Great Plains Region, Aberdeen, South Dakota, and was necessary to determine individual and tribal trust lands.
The lands we surveyed are:
The plat, in two sheets, representing the dependent resurvey of a portion of the east boundary, a portion of the subdivisonal lines, and the subdivision of section 24, Township 42 North, Range 29 West, Sixth Principal Meridian, South Dakota, was accepted March 24, 2016. We will place a copy of the plat, in two sheets, we described in the open files. They will be available to the public as a matter of information. If the BLM receives a protest against this survey, as shown on this plat, in two sheets, prior to the date of the official filing, we will stay the filing pending our consideration of the protest. We will not officially file this plat, in two sheets, until the day after we have accepted or dismissed all protests and they have become final, including decisions or appeals. Before including your address, phone number, email address, or other personally identifying information in your comment, you should be aware that your entire comment—including your personally identifying information—may be made publicly available at any time. While you can ask us in your comment to withhold your personally identifying information from public review, we cannot guarantee that we will be able to do so.
43 U.S.C. Chap. 3.
National Park Service, Interior.
Notice; request for comments.
We (National Park Service, NPS) will ask the Office of Management and Budget (OMB) to approve the information collection described below. As required by the Paperwork Reduction Act of 1995 and as part of our continuing efforts to reduce paperwork and respondent burden, we invite the general public and other Federal agencies to take this opportunity to comment on this information collection. We may not conduct or sponsor and a person is not required to respond to a collection of information unless it displays a valid OMB control number.
Please submit your comment on or before June 24, 2016.
Please send your comments on the ICR to Madonna L. Baucum, Information Collection Clearance Officer, National Park Service, 12201 Sunrise Valley Drive, Room 2C114, Mail Stop 242, Reston, VA 20192 (mail); or
Stephan Nofield, Rivers, Trails, and Conservation Assistance Program Manager, National Park Service, Department of the Interior, 1201 Eye St. NW., Washington, DC 20005. You may send an email to
The purpose of this information collection is to enable members of the general public to apply for technical assistance provided by the NPS Rivers, Trails, and Conservation Assistance (RTCA) Program. The information collected will be used by the NPS to evaluate the applications for technical assistance. The RTCA Program draws its authority from three important pieces of legislation, the Wild and Scenic Rivers Act (16 U.S.C. 1271 through 1287), the National Trails System Act (16 U.S.C. 1241 through 1249), and the Outdoor Recreation Act of 1963 (16 U.S.C. 4601-1 through 4601-3).
The RTCA Program is the community assistance service of the NPS. RTCA supports community-led natural resource conservation and outdoor recreation projects. Additionally, NPS staff provide technical assistance to communities to conserve rivers, preserve open space, and develop trails and greenways and other conservation and outdoor recreation community initiatives.
The RTCA Program collects the following as part of the application package to request technical assistance:
• Completed application form (NPS Form 10-1001 (Rev. 04/2016));
• Site location map;
• At least three (3) letters of commitment; and
• Supplementary information to help the NPS learn more about the project (background documents, examples of media coverage, additional support letters, maps, list of links to resources, project photos, etc.).
We invite comments concerning this information collection on:
• Whether or not the collection of information is necessary, including whether or not the information will have practical utility;
• The accuracy of the burden for this collection of information;
• Ways to enhance the quality, utility, and clarity of the information to be collected; and
• Ways to minimize the burden to respondents, including use of automated information techniques or other forms of information technology.
Please note that the comments submitted in response to this notice are a matter of public record. We will include or summarize each comment in our request to OMB to approve this IC. Before including your address, phone number, email address, or other personal identifying information in your comment, you should be aware that your entire comment, including your personal identifying information, may be made publicly available at any time. While you can ask us in your comment to withhold your personal identifying information from public review, we cannot guarantee that it will be done.
National Park Service, Interior.
Notice.
The Utah Museum of Natural History has completed an inventory of human remains, in consultation with the appropriate Indian tribes or Native Hawaiian organizations, and has determined that there is a cultural affiliation between the human remains and present-day Indian tribes or Native Hawaiian organizations. Lineal descendants or representatives of any Indian tribe or Native Hawaiian organization not identified in this notice that wish to request transfer of control of these human remains should submit a written request to the Utah Museum of Natural History. If no additional requestors come forward, transfer of control of the human remains to the lineal descendants, Indian tribes, or Native Hawaiian organizations stated in this notice may proceed.
Lineal descendants or representatives of any Indian tribe or Native Hawaiian organization not identified in this notice that wish to request transfer of control of these human remains should submit a written request with information in support of the request to the Utah Museum of Natural History at the address in this notice by May 25, 2016.
Dr. Lisbeth Louderback, Utah Museum of Natural History, 301 Wakara Way, Salt Lake City, UT 84108, telephone (801) 585-2634, email
Notice is here given in accordance with the Native American Graves Protection and Repatriation Act (NAGPRA), 25 U.S.C. 3003, of the completion of an inventory of human remains under the control of the Utah Museum of Natural History, Salt Lake City, UT. The human remains were removed from Fillmore, Millard County, Utah.
This notice is published as part of the National Park Service's administrative responsibilities under NAGPRA, 25 U.S.C. 3003(d)(3). The determinations in this notice are the sole responsibility of the museum, institution, or Federal agency that has control of the Native American human remains. The National Park Service is not responsible for the determinations in this notice.
A detailed assessment of the human remains was made by the Utah Museum of Natural History professional staff in consultation with representatives of the Confederated Tribes of the Goshute Reservation, Nevada and Utah; Northwestern Band of Shoshoni Nation of Utah (Washakie); Paiute Indian Tribe of Utah (Cedar Band of Paiutes, Kanosh Band of Paiutes, Koosharem Band of Paiutes, Indian Peaks Band of Paiutes, and Shivwits Band of Paiutes); Skull Valley Band of Goshute Indians of Utah; and the Ute Indian Tribe of the Uintah & Ouray Reservation, Utah.
Around 1932, human remains representing, at minimum, one individual male between the ages of 35-50 were removed from a privately-owned field in Fillmore in Millard County, UT. The individual (UMNH148) was recovered during ploughing and shortly thereafter were transferred to the University of Utah. The Utah Museum of Natural History received control of the human remains in 1973. No known individuals were identified. No associated funerary objects were found.
An osteological analysis indicates that the individual is Native American. Based on the geographical location of the burial, the individual is most closely affiliated with the Kanosh Band of the Paiute Indian Tribe of Utah, who inhabited this area during the protohistoric and contact periods.
Officials of the Utah Museum of Natural History have determined that:
• Pursuant to 25 U.S.C. 3001(9), the human remains described in this notice represent the physical remains of one individual of Native American ancestry.
• Pursuant to 25 U.S.C. 3001(2), there is a relationship of shared group identity that can be reasonably traced between the Native American human remains and the Kanosh Band of the Paiute Indian Tribe of Utah.
Lineal descendants or representatives of any Indian tribe or Native Hawaiian organization not identified in this notice that wish to request transfer of control of these human remains should submit a written request with information in support of the request to Dr. Lisbeth Louderback, Utah Museum of Natural History, 301 Wakara Way, Salt Lake City, UT 84108, telephone (801) 585-2634, email
The Utah Museum of Natural History is responsible for notifying the Confederated Tribes of the Goshute Reservation, Nevada and Utah; Northwestern Band of Shoshoni Nation of Utah (Washakie); Paiute Indian Tribe of Utah (Cedar Band of Paiutes, Kanosh Band of Paiutes, Koosharem Band of Paiutes, Indian Peaks Band of Paiutes, and Shivwits Band of Paiutes); Skull Valley Band of Goshute Indians of Utah; and the Ute Indian Tribe of the Uintah & Ouray Reservation, Utah that this notice has been published.
U.S. International Trade Commission.
Notice.
Notice is hereby given that a complaint was filed with the U.S.
The complainant requests that the Commission institute an investigation and, after the investigation, issue a limited exclusion order and cease and desist orders.
The complaint, as supplemented, except for any confidential information contained therein, is available for inspection during official business hours (8:45 a.m. to 5:15 p.m.) in the Office of the Secretary, U.S. International Trade Commission, 500 E Street SW., Room 112, Washington, DC 20436, telephone (202) 205-2000. Hearing impaired individuals are advised that information on this matter can be obtained by contacting the Commission's TDD terminal on (202) 205-1810. Persons with mobility impairments who will need special assistance in gaining access to the Commission should contact the Office of the Secretary at (202) 205-2000. General information concerning the Commission may also be obtained by accessing its Internet server at
The Office of Docket Services, U.S. International Trade Commission, telephone (202) 205-1802.
The authority for institution of this investigation is contained in section 337 of the Tariff Act of 1930, as amended, and in section 210.10 of the Commission's Rules of Practice and Procedure, 19 CFR 210.10 (2015).
(1) Pursuant to subsection (b) of section 337 of the Tariff Act of 1930, as amended, an investigation be instituted to determine whether there is a violation of subsection (a)(1)(B) of section 337 in the importation into the United States, the sale for importation, or the sale within the United States after importation of certain height-adjustable desk platforms and components thereof by reason of infringement of one or more of claims 1-2, 4, 6-8, and 10-11 of the '703 patent and claims 1-2, 5-18, and 22-26 of the '809 patent, and whether an industry in the United States exists as required by subsection (a)(2) of section 337;
(2) For the purpose of the investigation so instituted, the following are hereby named as parties upon which this notice of investigation shall be served:
(a) The complainant is: Varidesk LLC, 117 Wrangler Drive, Coppell, TX 75019.
(b) The respondents are the following entities alleged to be in violation of section 337, and are the parties upon which the complaint is to be served:
(3) For the investigation so instituted, the Chief Administrative Law Judge, U.S. International Trade Commission, shall designate the presiding Administrative Law Judge.
The Office of Unfair Import Investigations will not participate as a party in this investigation.
Responses to the complaint and the notice of investigation must be submitted by the named respondents in accordance with section 210.13 of the Commission's Rules of Practice and Procedure, 19 CFR 210.13. Pursuant to 19 CFR 201.16(e) and 210.13(a), such responses will be considered by the Commission if received not later than 20 days after the date of service by the Commission of the complaint and the notice of investigation. Extensions of time for submitting responses to the complaint and the notice of investigation will not be granted unless good cause therefor is shown.
Failure of a respondent to file a timely response to each allegation in the complaint and in this notice may be deemed to constitute a waiver of the right to appear and contest the allegations of the complaint and this notice, and to authorize the administrative law judge and the Commission, without further notice to the respondent, to find the facts to be as alleged in the complaint and this notice and to enter an initial determination and a final determination containing such findings, and may result in the issuance of an exclusion order or a cease and desist order or both directed against the respondent.
By order of the Commission.
Civil Rights Division, Department of Justice.
60-Day notice.
The Department of Justice (DOJ), Civil Rights Division, will be submitting the following information collection request to the Office of Management and Budget (OMB) for review and approval in accordance with the Paperwork Reduction Act of 1995.
Comments are encouraged and will be accepted for “sixty days” until June 24, 2016.
If you have comments especially on the estimated public burden or associated response time, suggestions, or need a copy of the proposed information collection instrument with instructions or additional information, please contact Alberto Ruisanchez, Deputy Special Counsel, USDOJ-CRT-OSC, 950 Pennsylvania Avenue NW-NYA, Washington, DC 20530.
Written comments and suggestions from the public and affected agencies concerning the proposed collection of information are encouraged. Your comments should address one or more of the following four points:
(1)
(2)
(3)
(4) Affected public who will be asked or required to respond, as well as a brief abstract: General Public. The Office of Special Counsel for Immigration-Related Unfair Employment Practices (OSC) enforces the anti-discrimination provision (§ 274B) of the Immigration and Nationality Act (INA), 8 U.S.C. 1324b. The statute prohibits: (1) Citizenship or immigration status discrimination in hiring, firing, or recruitment or referral for a fee, (2) national origin discrimination in hiring, firing, or recruitment or referral for a fee, (3) unfair documentary practices during the employment eligibility verification (Form I-9 and E-Verify) process, and (4) retaliation or intimidation for asserting rights covered by the statute. OSC, within the Department's Civil Rights Division, investigates and, where reasonable cause is found, litigates charges alleging discrimination. OSC also initiates independent investigations, at times based on information developed during individual charge investigations. Independent investigations normally involve alleged discriminatory policies that potentially affect many employees or applicants. These investigations may result in complaints alleging a pattern or practice of discriminatory activity. If the Department lacks jurisdiction over a particular charge but believes another agency has jurisdiction over the claim, the charge is forwarded to the applicable Federal, state or local agency for any action deemed appropriate.
(5)
(6)
If additional information is required contact: Jerri Murray, Department Clearance Officer, United States Department of Justice, Justice Management Division, Policy and Planning Staff, Two Constitution Square, 145 N Street NE., Suite 3E.405B, Washington, DC 20530.
National Institute of Justice, Justice.
Notice.
The National Institute of Justice (NIJ) announces publication of
Brian Montgomery, by telephone at (202) 353-9786 [Note: this is not a toll-free telephone number], or by email at
In accordance with Section 223 of the Trade Act of 1974, as amended (“Act”), 19 U.S.C. 2273, the Department of Labor issued a Certification of Eligibility to Apply for Worker Adjustment Assistance on September 16, 2015, applicable to workers and former workers of Magnetation LLC, Plant 1, Keewatin, Minnesota (Magnetation-Plant 1). Magnetation LLC (subject firm) is engaged in the activities related to the production of iron ore concentrate. The certification applicable to Magnetation-Plant 1 was based on the Department's finding that the petitioning worker group met the requirements of Section 222(b) of the Act.
Following the issuance of the determination, the Department reviewed the certification applicable to workers and former workers of Magnetation-Plant 1.
New information provided by the subject firm revealed that Magnetation LLC, Plant 4, Grand Rapids, Minnesota (Magnetation-Plant 4) is a supplier to the same firm(s) supplied by Magnetation-Plant 1 and Magnetation-Plant 2, and that the workers of Magnetation-Plant 4 are similarly-affected as the workers of Magnetation-Plant 1 and Magnetation-Plant 2.
Based on these findings, the Department is amending this certification to include workers from Magnetation LLC, Plant 4, Grand Rapids, Minnesota.
The amended notice applicable to TA-W-86,083 is hereby issued as follows:
”All workers of Magnetation LLC, Plant 1, Keewatin, Minnesota (TA-W-86,083), Magnetation LLC, Plant 2, Bovey, Minnesota (TA-W-86,083A), and Magnetation LLC, Plant 4, Grand Rapids, Minnesota (TA-W-86,083B), who became totally or partially separated from employment on or after June 9, 2014 through September 16, 2017, are eligible to apply for adjustment assistance under Chapter 2 of Title II of the Trade Act of 1974, as amended.”
Office of the Assistant Secretary for Policy, Chief Evaluation Office, Department of Labor.
Notice.
The Department of Labor, as part of its continuing effort to reduce paperwork and respondent burden, conducts a preclearance consultation program to provide the general public and federal agencies with an opportunity to comment on proposed and/or continuing collections of information in accordance with the Paperwork Reduction Act of 1995 (PRA95) [44 U.S.C. 3506(c)(2)(A)]. This program helps to ensure that requested data can be provided in the desired format, reporting burden (time and financial resources) is minimized, collection instruments are clearly understood, and the impact of collection requirements on respondents is properly assessed.
A copy of the proposed Information Collection Request (ICR) can be obtained by contacting the office listed in the addressee section of this notice.
Written comments must be submitted to the office listed in the addressee's section below on or before June 24, 2016.
You may submit comments by either one of the following methods:
Molly Irwin by telephone at 202-693-5091 (this is not a toll-free number) or by email at
The U.S. Department of Labor (DOL) is proposing a data collection activity as part of the H-1B Ready to Work Partnership Grants Evaluation Impact Study. The goal of the evaluation is determine the effectiveness of the H-1B grant-funded program in improving the labor market and other outcomes of program participants. For selected grantees, the impact study will randomly assign individuals to a group that can receive grant-funded programs or to a group that cannot access these services but who can participate in other services available in the community. The impact study will compare the employment and earnings and other outcomes of the groups to determine effectiveness of the H1-B Ready to Work training grants. The evaluation also includes an implementation study will describe services participants receive through the grantee programs, as well as provide operational lessons.
Data collection efforts previously approved for the H-1B Impact Study under OMB Control Number 1205-0507 include: Data collection activities for the implementation study, a study consent form, and a baseline information form for study participants. These collection activities will continue under the previously approved request.
This
DOL is soliciting comments concerning the above data collection for the H-1B Ready to Work Partnership Grants Evaluation. DOL is particularly interested in comments that do the following:
• Evaluate whether the proposed collection of information is necessary for the proper performance functions of the agency, including whether the information will have practical utility;
• Evaluate the accuracy of the agency's burden estimate of the proposed information collection, including the validity of the methodology and assumptions used;
• Enhance the quality, utility, and clarity of the information to be collected; and
• Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology (for example, permitting electronic submissions of responses).
DOL is requesting clearance for the follow-up survey of sample members in the H-1B Ready to Work Impact Study.
Comments submitted in response to this comment request will be summarized and/or included in the request for Office of Management and Budget approval of the information collection request; they will also become a matter of public record.
Occupational Safety and Health Administration (OSHA), Labor.
Announcement of WPAC charter renewal.
In accordance with the provisions of the Federal Advisory Committee Act (FACA), and after consultation with the General Services Administration, the Secretary of Labor is renewing the charter for the Whistleblower Protection Advisory Committee (WPAC or the Committee). The Committee will better enable OSHA to perform its duties under the Occupational Safety and Health Act (the OSH Act) of 1970, and help to improve the fairness, efficiency, and transparency of OSHA's whistleblower investigations.
Anthony Rosa, OSHA, Directorate of Whistleblower Protection Programs, Room N-4618, U.S. Department of Labor, 200 Constitution Avenue NW., Washington, DC 20210; telephone (202) 693-2199; email
WPAC operates in accordance with the Federal Advisory Committee Act (FACA), as amended (5 U.S.C. App. 2), its implementing regulations (41 CFR part 102-3), and OSHA's regulations on advisory committees (29 CFR part 1912). Pursuant to Section 14 of FACA, WPAC's charter must be renewed every two years.
WPAC's duties are solely advisory and consultative. WPAC advises, consults with, and makes recommendations to the Secretary and the Assistant Secretary on matters relating to whistleblower complaints filed under the whistleblower statutes that the Occupational Safety and Health Administration (OSHA) enforces. The Committee is diverse and balanced, both in terms of categories of stakeholders (
Authority to establish this Committee is at Section 11(c) of the OSH Act, 29 U.S.C. 660(c); the Surface Transportation Assistance Act, 49 U.S.C. 31105; the Asbestos Hazard Emergency Response Act, 15 U.S.C. 2651; the International Safe Container Act, 46 U.S.C. 80507; the Safe Drinking Water Act, 42 U.S.C. 300j-9(i); the Federal Water Pollution Control Act, 33 U.S.C. 1367; the Toxic Substances Control Act, 15 U.S.C. 2622; the Solid Waste Disposal Act, 42 U.S.C. 6971; the Clean Air Act, 42 U.S.C. 7622; the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. 9610; the Energy Reorganization Act, 42 U.S.C. 5851; the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century, 49 U.S.C. 42121; the Sarbanes-Oxley Act, 18 U.S.C. 1514A; the Pipeline Safety Improvement Act, 49 U.S.C. 60129; the Federal Railroad Safety Act, 49 U.S.C. 20109; the National Transit Systems Security Act, 6 U.S.C. 1142; the Consumer Product Safety Improvement Act, 15 U.S.C. 2087; the Affordable Care Act, 29 U.S.C. 218C; the Consumer Financial Protection Act of 2010, 12 U.S.C. 5567; the Seaman's Protection Act, 46 U.S.C. 2114; the FDA Food Safety Modernization Act, 21 U.S.C. 399d; and the Moving Ahead for Progress in the 21st Century Act, 49 U.S.C. 30171.
David Michaels, Ph.D., MPH, Assistant Secretary of Labor for Occupational Safety and Health, authorized the preparation of this notice under the authority granted by 5 U.S.C. App. 2, 41 CFR part 102-3, chapter 1600 of Department of Labor Management Series 3 (Aug. 15, 2013), 77 FR 3912 (Jan. 25, 2012), and the Secretary of Labor's authority to administer the whistleblower provisions found in 29 U.S.C. 660(c), 49 U.S.C. 31105, 15 U.S.C. 2651, 46 U.S.C. 80507, 42 U.S.C. 300j-9(i), 33 U.S.C. 1367, 15 U.S.C. 2622, 42 U.S.C. 6971, 42 U.S.C. 7622, 42 U.S.C. 9610, 42 U.S.C. 5851, 49 U.S.C. 42121, 18 U.S.C. 1514A, 49 U.S.C. 60129, 49 U.S.C. 20109, 6 U.S.C. 1142, 15 U.S.C. 2087, 29 U.S.C. 218c, 12 U.S.C. 5567, 46 U.S.C. 2114, 21 U.S.C. 399d, and 49 U.S.C. 30171.
Occupational Safety and Health Administration (OSHA), Labor.
Notice.
In this notice, OSHA announces its final decision to expand the scope of recognition for QPS Evaluation Services Inc. as a Nationally Recognized Testing Laboratory (NRTL).
The expansion of the scope of recognition becomes effective on April 25, 2016.
Information regarding this notice is available from the following sources:
OSHA hereby gives notice of the expansion of the scope of recognition of QPS Evaluation Services Inc. (QPS) as an NRTL. QPS's expansion covers the addition of one test standard to its scope of recognition.
OSHA recognition of an NRTL signifies that the organization meets the requirements specified by 29 CFR 1910.7. Recognition is an acknowledgment that the organization can perform independent safety testing and certification of the specific products covered within its scope of recognition and is not a delegation or grant of government authority. As a result of recognition, employers may use products properly approved by the NRTL to meet OSHA standards that
The Agency processes applications by an NRTL for initial recognition, or for expansion or renewal of this recognition, following requirements in Appendix A to 29 CFR 1910.7. This appendix requires that the Agency publish two notices in the
QPS submitted an application, dated July 28, 2014, (OSHA-2010-0046-0005) to expand its recognition to include one additional test standard. OSHA staff performed a detailed analysis of the application packet and reviewed other pertinent information. OSHA performed an on-site review in relation to this application on July 16-17, 2015.
OSHA published the preliminary notice announcing QPS's expansion application in the
To obtain or review copies of all public documents pertaining to QPS's application, go to
OSHA staff examined QPS's expansion application, its capability to meet the requirements of the test standards, and other pertinent information. Based on its review of this evidence, OSHA finds that QPS meets the requirements of 29 CFR 1910.7 for expansion of its recognition, subject to the specified limitation and conditions listed below. OSHA, therefore, is proceeding with this final notice to grant QPS's scope of recognition. OSHA limits the expansion of QPS's recognition to testing and certification of products for demonstration of conformance to the test standard listed in Table 1 below.
OSHA's recognition of any NRTL for a particular test standard is limited to equipment or materials for which OSHA standards require third-party testing and certification before using them in the workplace. Consequently, if a test standard also covers any products for which OSHA does not require such testing and certification, an NRTL's scope of recognition does not include these products.
In addition to those conditions already required by 29 CFR 1910.7, QPS must abide by the following conditions of the recognition:
1. QPS must inform OSHA as soon as possible, in writing, of any change of ownership, facilities, or key personnel, and of any major change in its operations as an NRTL, and provide details of the change(s);
2. QPS must meet all the terms of its recognition and comply with all OSHA policies pertaining to this recognition; and
3. QPS must continue to meet the requirements for recognition, including all previously published conditions on QPS's scope of recognition, in all areas for which it has recognition.
Pursuant to the authority in 29 CFR 1910.7, OSHA hereby expands the scope of recognition of QPS, subject to the limitation and conditions specified above.
David Michaels, Ph.D., MPH, Assistant Secretary of Labor for Occupational Safety and Health, 200 Constitution Avenue NW., Washington, DC 20210, authorized the preparation of this notice. Accordingly, the Agency is issuing this notice pursuant to 29 U.S.C. 657(g)(2), Secretary of Labor's Order No. 1-2012 (77 FR 3912, Jan. 25, 2012), and 29 CFR 1910.7.
Occupational Safety and Health Administration (OSHA), Labor.
Notice.
This notice announces the Occupational Safety and Health Administration's final decision granting renewal and expansion of recognition of QPS Evaluation Services Inc., as a Nationally Recognized Testing Laboratory (NRTL).
The renewal and expansion of recognition become effective on April 25, 2016.
Information regarding this notice is available from the following sources:
OSHA recognition of an NRTL signifies that the organization meets the requirements specified by 29 CFR 1910.7. Recognition is an acknowledgment that the organization can perform independent safety testing and certification of the specific products covered within its scope of recognition and is not a delegation or grant of government authority. Each NRTL's scope of recognition includes (1) the type of products the NRTL may test, with each type specified by its applicable test standard; and (2) the recognized site(s) that has/have the technical capability to perform the product-testing and product-certification activities for test standards within the NRTL's scope. As a result of recognition, employers may use products properly approved by the NRTL to meet OSHA standards that require testing and certification. OSHA maintains an informational Web page for each NRTL at
OSHA processes applications submitted by an NRTL for renewal and expansion of recognition following requirements in Appendix A to 29 CFR 1910.7. OSHA conducts renewals in accordance with the procedures in 29 CFR 1910.7, Appendix A, Section II.C. OSHA processes applications for modifying the scope of recognition in accordance with 29 CFR 1910.7, Appendix A, Section II.B. An NRTL may submit an application to modify its scope of recognition at any time within its recognition period. For renewal, an NRTL must submit a renewal request to OSHA between nine months and one year before the expiration date of its current recognition. A renewal request includes an application for renewal and any additional information demonstrating an NRTL's continued compliance with the terms of its recognition and 29 CFR 1910.7. If OSHA has not conducted an on-site assessment of the NRTL headquarters and any key sites within the past 18 to 24 months, it will schedule the necessary on-site assessment prior to the expiration date of the NRTL's recognition.
Upon review of the submitted material and, as necessary, the successful completion of the on-site assessment, OSHA announces its preliminary decision to grant or deny renewal and expansion of an NRTL's scope of recognition in the
QPS Evaluation Services Inc. (QPS), initially received OSHA recognition as an NRTL on March 2, 2011 (76 FR 11518) for a five-year period expiring on March 2, 2016. QPS submitted a timely request for renewal, dated April 21, 2015 (OSHA-2010-0046-0007), and retained its recognition pending OSHA's final decision in this renewal process. The current address of QPS facilities recognized by OSHA and included as part of the renewal request is: QPS Evaluation Services Inc., 81 Kelfield Street, Unit 8, Toronto, Ontario M9W 5A3, Canada.
OSHA evaluated QPS's application for renewal and made a preliminary determination that QPS can continue to meet the requirements prescribed by 29 CFR 1910.7 for recognition. OSHA conducted an on-site assessment of QPS facilities on July 16-17, 2015 (Toronto, Canada) and found nonconformances with the requirements of 29 CFR 1910.7. QPS addressed these issues sufficiently to meet the applicable NRTL requirements.
QPS submitted applications, dated July 16, 2014, and June 9, 2015 (OSHA-2010-0046-0004), to expand its recognition to include a total of seven additional test standards. OSHA staff performed a comparability analysis and reviewed other pertinent information. OSHA performed an on-site review in relation to these applications (as well as the application for renewal) on July 16-17, 2015.
OSHA published the preliminary notice announcing QPS's renewal request and scope expansion applications in the
To obtain or review copies of all public documents pertaining to the QPS's applications, go to
OSHA staff examined QPS's renewal and expansion applications, its capability to meet the requirements of the test standards, and other pertinent information. Based on its review of this evidence, OSHA finds that QPS meets the requirements of 29 CFR 1910.7 for renewal and expansion of its recognition, subject to the specified limitations and conditions listed below. OSHA, therefore, is proceeding with this final notice to grant QPS's renewal and scope of recognition requests. OSHA limits the expansion of QPS's recognition to testing and certification of products for demonstration of conformance to the test standards listed in Table 1 below.
OSHA's recognition of any NRTL for a particular test standard is limited to equipment or materials for which OSHA standards require third-party testing and certification before using them in the workplace. Consequently, if a test standard also covers any products for which OSHA does not require such testing and certification, an NRTL's scope of recognition does not include these products.
The American National Standards Institute (ANSI) may approve the test standards listed above as American National Standards. However, for convenience, we may use the designation of the standards-developing organization for the standard as opposed to the ANSI designation. Under the NRTL Program's policy (see OSHA Instruction CPL 1-0.3, Appendix C, paragraph XIV), any NRTL recognized for a particular test standard may use either the proprietary version of the test standard or the ANSI version of that standard. Contact ANSI to determine whether a test standard is currently ANSI-approved.
OSHA limits the renewal of QPS's recognition to include the terms and conditions of QPS's scope of recognition, inclusive of the expansion of scope granted in this notice. The scope of recognition for QPS is available in the
In addition to those conditions already required by 29 CFR 1910.7, QPS also must abide by the following conditions of recognition:
1. QPS must inform OSHA as soon as possible, in writing, of any change of ownership, facilities, or key personnel, and of any major change in its operations as an NRTL, and provide details of the change(s);
2. QPS must meet all the terms of its recognition and comply with all OSHA policies pertaining to this recognition; and
3. QPS must continue to meet the requirements for recognition, including all previously published conditions on QPS's scope of recognition, in all areas for which it has recognition.
David Michaels, Ph.D., MPH, Assistant Secretary of Labor for Occupational Safety and Health, 200 Constitution Avenue NW., Washington, DC 20210, authorized the preparation of this notice. Accordingly, the Agency is issuing this notice pursuant to 29 U.S.C. 657(g)(2), Secretary of Labor's Order No. 1-2012 (77 FR 3912, January 25, 2012), and 29 CFR 1910.7.
National Foundation on the Arts and the Humanities.
Notice of meeting.
Pursuant to the Federal Advisory Committee Act, notice is hereby given that the Federal Council on the Arts and the Humanities will hold a meeting of the Arts and Artifacts International Indemnity Panel.
The meeting will be held on Wednesday, May 18, 2016, from 1:00 p.m. to 5:00 p.m.
The meeting will be held by teleconference originating at the National Endowment for the Arts, Washington, DC 20506.
Elizabeth Voyatzis, Committee Management Officer, 400 7th Street SW., Room 4060, Washington, DC 20506, (202) 606 8322;
The purpose of the meeting is for panel review, discussion, evaluation, and recommendation on applications for Certificates of Indemnity submitted to the Federal Council on the Arts and the Humanities, for exhibitions beginning on or after July 1, 2016. Because the meeting will consider proprietary financial and commercial data provided in confidence by indemnity applicants, and material that is likely to disclose trade secrets or other privileged or confidential information, and because it is important to keep the values of objects to be indemnified, and the methods of transportation and security measures confidential, I have determined that the meeting will be closed to the public pursuant to subsection (c)(4) of section 552b of Title 5, United States Code. I have made this determination under the authority granted me by the Chairman's Delegation of Authority to Close Advisory Committee Meetings, dated July 19, 1993.
April 25, May 2, 9, 16, 23, 30, 2016.
Commissioners' Conference Room, 11555 Rockville Pike, Rockville, Maryland.
Public and Closed.
There are no meetings scheduled for the week of April 25, 2016.
There are no meetings scheduled for the week of May 2, 2016.
There are no meetings scheduled for the week of May 9, 2016.
This meeting will be webcast live at the Web address—
There are no meetings scheduled for the week of May 23, 2016.
This meeting will be webcast live at the Web address—
The schedule for Commission meetings is subject to change on short notice. For more information or to verify the status of meetings, contact Denise McGovern at 301-415-0681 or via email at
The NRC Commission Meeting Schedule can be found on the Internet at:
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Nuclear Regulatory Commission.
Exemption; issuance.
The U.S. Nuclear Regulatory Commission (NRC) is issuing an exemption from the requirement to maintain a specified level of onsite property damage insurance in response to a request from Entergy Nuclear Operations, Inc. (ENO or the licensee) dated April 17, 2014. The exemption would permit Vermont Yankee Nuclear Power Station (VY) to reduce its onsite insurance from $1.06 billion to $50 million.
April 25, 2016.
Please refer to Docket ID NRC-2016-0017 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document using any of the following methods:
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Jack D. Parrott, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-6634, email:
The VY site is a single unit facility located near the town of Vernon, Vermont. The site is situated in Windham County on the western shore of the Connecticut River, immediately upstream of the Vernon Hydroelectric Station. The VY facility employs a General Electric boiling water reactor nuclear steam supply system licensed to generate 1,912 megawatts thermal. The boiling water reactor and supporting facilities are owned and operated by Entergy Vermont Yankee, a subsidiary of ENO. The licensee, ENO, is the holder of Renewed Facility Operating License No. DPR-28. The license provides, among other things, that the facility is subject to all rules, regulations, and orders of the NRC now or hereafter in effect.
By letter dated September 23, 2013 (ADAMS Accession No. ML13273A204), ENO submitted a notification to the NRC indicating that it would permanently shut down VY in the fourth calendar quarter of 2014. On December 29, 2014, ENO permanently ceased power operations at VY. On January 12, 2015, ENO certified that it had permanently defueled the VY reactor vessel and placed the fuel in the spent fuel pool (SFP) (ADAMS Accession No. ML15013A426). Accordingly, pursuant to § 50.82(a)(2) of title 10 of the Code of Federal Regulations (10 CFR), the VY renewed facility operating license no longer authorized operation of the reactor or emplacement or retention of fuel in the reactor vessel. However, the licensee is still authorized to possess and store irradiated nuclear fuel. Irradiated fuel is currently being stored onsite in a SFP and independent spent fuel storage installation dry casks.
Under 10 CFR 50.12, “Specific exemptions,” ENO has requested an exemption from 10 CFR 50.54(w)(1) by letter dated April 17, 2014 (ADAMS Accession No. ML14111A401). The exemption from the requirements of 10 CFR 50.54(w)(1) would permit ENO to reduce its onsite property damage insurance from $1.06 billion to $50 million.
The regulation in 10 CFR 50.54(w)(1) requires each licensee to have and maintain onsite property damage insurance to stabilize and decontaminate the reactor and reactor site in the event of an accident. The onsite insurance coverage must be either $1.06 billion or whatever amount of insurance is generally available from private sources (whichever is less).
The licensee states that the risk of an accident at a permanently shutdown and defueled reactor is much less than the risk from an operating power reactor. In addition, since reactor operation is no longer authorized at VY, there are no events that would require the stabilization of reactor conditions after an accident. Similarly, the risk of an accident that would result in significant onsite contamination at VY is also much lower than the risk of such an event at operating reactors. Therefore, ENO is requesting an exemption from 10 CFR 50.54(w)(1), effective April 15, 2016, that would permit a reduction in its onsite property damage insurance from $1.06 billion to
In accordance with 10 CFR 50.12, the Commission may, upon application by any interested person or upon its own initiative, grant exemptions from the requirements of 10 CFR part 50 when (1) the exemptions are authorized by law, will not present an undue risk to the public health or safety, and are consistent with the common defense and security; and (2) any of the special circumstances listed in 10 CFR 50.12(a)(2) are present.
The financial protection limits of 10 CFR 50.54(w)(1) were established after the Three Mile Island accident, out of concern that licensees may be unable to financially cover onsite cleanup costs, in the event of a major nuclear accident. The specified $1.06 billion coverage amount requirement was developed based on an analysis of an accident at a nuclear reactor operating at power, resulting in a large fission product release and requiring significant resource expenditures to stabilize the reactor conditions and ultimately decontaminate and cleanup the site (similar to the stabilization and cleanup activities at the Fukushima Daiichi nuclear power facility following the damage from a severe earthquake and tsunami).
These cost estimates were developed in consideration of the spectrum of postulated accidents for an operating nuclear reactor. The costs were derived from the consequences of a release of radioactive material from the reactor. Although the risk of an accident at an operating reactor is very low, the consequences can be large. In an operating plant, the high temperature and pressure of the reactor coolant system (RCS), as well as the inventory of relatively short-lived radionuclides, contribute to both the risk and consequences of an accident. With the permanent cessation of reactor operations at VY and the permanent removal of the fuel from the reactor core, such accidents are no longer possible. As a result, the reactor, RCS, and supporting systems no longer operate and, therefore, have no function as it pertains to the storage of the irradiated fuel. Hence, postulated accidents involving failure or malfunction of the reactor, RCS, or supporting systems are no longer applicable.
During reactor decommissioning, the principal radiological risks are associated with the storage of spent fuel onsite. In its April 17, 2014, exemption request, ENO describes both design-basis and beyond-design-basis events involving irradiated fuel stored in the SFP. The licensee determined that there are no applicable design-basis events at VY that could result in a radiological release exceeding the limits established by the U.S. Environmental Protection Agency (EPA) early-phase Protective Action Guidelines (PAGs) of one roentgen equivalent man (rem) at the exclusion area boundary, as a way to demonstrate that any possible radiological releases would be minimal and not require precautionary protective actions (
The NRC staff has previously authorized a lesser amount of onsite property damage insurance coverage based on this analysis of the zirconium fire risk. In SECY-96-256, “Changes to Financial Protection Requirements for Permanently Shutdown Nuclear Power Reactors, 10 CFR 50.54(w)(1) and 10 CFR 140.11,” dated December 17, 1996 (ADAMS Accession No. ML15062A483), the staff recommended changes to the power reactor insurance regulations that would allow licensees to lower onsite insurance levels to $50 million, upon demonstration that the fuel stored in the SFP can be air-cooled. In its Staff Requirements Memorandum to SECY-96-256, dated January 28, 1997 (ADAMS Accession No. ML15062A454), the Commission supported the staff's recommendation that, among other things, would allow permanently shutdown power reactor licensees to reduce commercial onsite property damage insurance coverage to $50 million, when the licensee was able to demonstrate the technical criterion that the spent fuel could be air-cooled if the SFP was drained of water. The staff has used this technical criterion to grant similar exemptions to other decommissioning reactors (
In SECY-00-0145, “Integrated Rulemaking Plan for Nuclear Power Plant Decommissioning,” dated June 28, 2000, and SECY-01-0100, “Policy Issues Related to Safeguards, Insurance, and Emergency Preparedness Regulations at Decommissioning Nuclear Power Plants Storing Fuel in Spent Fuel Pools,” dated June 4, 2001 (ADAMS Accession Nos. ML003721626 and ML011450420, respectively), the NRC staff discussed additional information concerning SFP zirconium fire risks at decommissioning reactors and associated implications for onsite property damage insurance. Providing an analysis of when the spent fuel stored in the SFP is capable of air-cooling is one measure that can be used to demonstrate that the probability of a zirconium fire is exceedingly low. However, the staff has more recently used an additional analysis that bounds an incomplete drain down of the SFP water, or some other catastrophic event (such as a complete drainage of the SFP with rearrangement of spent fuel rack geometry and/or the addition of rubble to the SFP). This analysis includes an assumption of adiabatic conditions,
In the case of VY, the licensee determined that the fuel removed from the reactor would have sufficiently decayed by April 15, 2016, to significantly reduce the risk from SFP draining events. To support this determination, the licensee provided an adiabatic analysis indicating that the fuel cladding temperature would not reach levels associated with a significant radiological release within 10 hours after the loss of all means of cooling. The licensee maintains strategies and equipment to cool the spent fuel in the unlikely event that coolant is lost, and the 10-hour adiabatic heating time would provide sufficient time for personnel to respond with onsite equipment to restore a means of spent fuel cooling.
In addition, the licensee cited NRC-staff developed reports concluding that the high density storage of fuel in the SFP is safe and the risk of a large radiological release is very low. The staff presented an independent evaluation of a SFP subject to a severe earthquake in NUREG-2161, “Consequence Study of a Beyond-Design-Basis Earthquake Affecting the Spent Fuel Pool for a U.S. Mark I Boiling Water Reactor,” September 2014 (ADAMS Accession No. ML14255A365). This evaluation concluded that, for a representative boiling-water reactor (BWR), fuel in a dispersed high-density configuration would be adequately cooled by natural circulation airflow within several months after discharge from a reactor if the pool was drained of water.
By letter dated November 23, 2015 (ADAMS Accession No.ML15329A167), ENO confirmed that the plant design and fuel storage configuration considered in NUREG-2161 were consistent with the VY plant design and fuel storage configurations to be used in the decommissioning of VY. The staff independently confirmed that the fuel assembly decay power was also consistent. Thus, after 15.4 months decay, which will be reached by the requested effective date of April 15, 2016 for this exemption, the fuel stored in the VY SFP will be able to adequately be cooled by air in the unlikely event the SFP drained. For the very unlikely beyond-design-basis accident scenario, where the SFP coolant inventory is lost in such a manner that all methods of heat removal from the spent fuel are no longer available, there will be a minimum of 10 hours from the initiation of the accident until the cladding reaches a temperature where offsite radiological release might occur. The staff finds that 10 hours is sufficient time to support deployment of mitigation equipment to prevent the zirconium cladding from reaching a point of rapid oxidation.
Based on the above discussion and SECY-96-256, the NRC staff determined $50 million to be an adequate level of onsite property damage insurance for a decommissioning reactor, once the spent fuel in the SFP is no longer susceptible to a zirconium fire. The staff has postulated that there is still a potential for other radiological incidents at a decommissioning reactor that could result in significant onsite contamination besides a zirconium fire. In SECY-96-256, the NRC staff cited the rupture of a large contaminated liquid storage tank, causing soil contamination and potential groundwater contamination, as the most costly postulated event to decontaminate and remediate (other than a SFP zirconium fire). The postulated large liquid radiological waste storage tank rupture event was determined to have a bounding onsite cleanup cost of approximately $50 million. Therefore, the staff determined that the licensee's proposal to reduce onsite insurance to a level of $50 million would be consistent with the bounding cleanup and decontamination cost, as discussed in SECY-96-256, to account for the postulated rupture of a large liquid radiological waste tank at the VY site, should such an event occur.
The regulation in 10 CFR 50.54(w)(1) requires each licensee to have and maintain onsite property damage insurance of either $1.06 billion or whatever amount of insurance is generally available from private sources, whichever is less. In accordance with 10 CFR 50.12, the Commission may grant exemptions from the regulations in 10 CFR part 50, as the Commission determines are authorized by law.
As explained above, the NRC staff has determined that the licensee's proposed reduction in onsite property damage insurance coverage to a level of $50 million is consistent with SECY-96-256. Moreover, the staff concluded that as of April 15, 2016, sufficient irradiated fuel decay time will have elapsed at VY to decrease the probability of an onsite and offsite radiological release from a postulated zirconium fire accident to negligible levels. In addition, the licensee's proposal to reduce onsite insurance to a level of $50 million is consistent with the maximum estimated cleanup costs for the recovery from the rupture of a large liquid radiological waste storage tank.
The NRC staff has determined that granting of the licensee's proposed exemption will not result in a violation of the Atomic Energy Act of 1954, or other laws, as amended. Therefore, based on its review of ENO's exemption request, as discussed above, and consistent with SECY-96-256, the NRC staff concludes that the exemption is authorized by law.
The onsite property damage insurance requirements of 10 CFR 50.54(w)(1) were established to provide financial assurance that following a significant nuclear incident, onsite conditions could be stabilized and the site decontaminated. The requirements of 10 CFR 50.54(w)(1) and the existing level of onsite insurance coverage for VY are predicated on the assumption that the reactor is operating. However, VY is a permanently shutdown and defueled facility. The permanently defueled status of the facility has resulted in a significant reduction in the number and severity of potential accidents, and correspondingly, a significant reduction in the potential for and severity of onsite property damage. The proposed reduction in the amount of onsite insurance coverage does not impact the probability or consequences of potential accidents. The proposed level of insurance coverage is commensurate with the reduced consequences of potential nuclear accidents at VY. Therefore, the NRC staff concludes that granting the requested exemption will not present an undue risk to the health and safety of the public.
The proposed exemption would not eliminate any requirements associated with physical protection of the site and would not adversely affect ENO's ability to physically secure the site or protect special nuclear material. Physical security measures at VY are not affected by the requested exemption. Therefore, the proposed exemption is consistent with the common defense and security.
Under 10 CFR 50.12(a)(2)(ii), special circumstances are present if the application of the regulation in the particular circumstances would not serve the underlying purpose of the rule or is not necessary to achieve the underlying purpose of the rule. The underlying purpose of 10 CFR 50.54(w)(1) is to provide reasonable
The NRC staff also finds that the licensee's proposed $50 million level of onsite insurance is consistent with the bounding cleanup and decontamination cost, as discussed in SECY-96-256, to account for the hypothetical rupture of a large liquid radiological waste tank at the VY site, should such an event occur. Therefore, the staff concludes that the application of the current requirements in 10 CFR 50.54(w)(1) to maintain $1.06 billion in onsite insurance coverage is not necessary to achieve the underlying purpose of the rule for the permanently shutdown and defueled VY reactor.
Under 10 CFR 50.12(a)(2)(iii), special circumstances are present whenever compliance would result in undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted, or that are significantly in excess of those incurred by others similarly situated.
The NRC staff concludes that if the licensee was required to continue to maintain an onsite insurance level of $1.06 billion, the associated insurance premiums would be in excess of those necessary and commensurate with the radiological contamination risks posed by the site. In addition, such insurance levels would be significantly in excess of other decommissioning reactor facilities that have been granted similar exemptions by the NRC.
The NRC staff finds that compliance with the existing rule would result in an undue hardship or other costs that are significantly in excess of those contemplated when the regulation was adopted and are significantly in excess of those incurred by others similarly situated.
Therefore, the special circumstances required by 10 CFR 50.12(a)(2)(ii) and 10 CFR 50.12(a)(2)(iii) exist.
The NRC approval of the exemption to insurance or indemnity requirements belongs to a category of actions that the Commission, by rule or regulation, has declared to be a categorical exclusion, after first finding that the category of actions does not individually or cumulatively have a significant effect on the human environment. Specifically, the exemption is categorically excluded from further analysis under § 51.22(c)(25).
Under 10 CFR 51.22(c)(25), granting of an exemption from the requirements of any regulation of Chapter I to 10 CFR is a categorical exclusion provided that (i) there is no significant hazards consideration; (ii) there is no significant change in the types or significant increase in the amounts of any effluents that may be released offsite; (iii) there is no significant increase in individual or cumulative public or occupational radiation exposure; (iv) there is no significant construction impact; (v) there is no significant increase in the potential for or consequences from radiological accidents; and (vi) the requirements from which an exemption is sought involve: surety, insurance, or indemnity requirements.
The Director, Division of Decommissioning, Uranium Recovery and Waste Programs, Office of Nuclear Material Safety and Safeguards, has determined that approval of the exemption request involves no significant hazards consideration because reducing the licensee's onsite property damage insurance for VY does not (1) involve a significant increase in the probability or consequences of an accident previously evaluated; or (2) create the possibility of a new or different kind of accident from any accident previously evaluated; or (3) involve a significant reduction in a margin of safety. The exempted financial protection regulation is unrelated to the operation of VY. Accordingly, there is no significant change in the types or significant increase in the amounts of any effluents that may be released offsite; and no significant increase in individual or cumulative public or occupational radiation exposure.
In addition, the exempted regulation is not associated with construction, so there is no significant construction impact. The exempted regulation does not concern the source term (
Accordingly, the Commission has determined that, pursuant to 10 CFR 50.12(a), the exemption from 50.54(w)(1) is authorized by law, will not present an undue risk to the public health and safety, and is consistent with the common defense and security. In addition, special circumstances are present as set forth in 10 CFR 50.12. Therefore, the Commission hereby grants VY an exemption from the requirements of 10 CFR 50.54(w)(1). The exemption will permit VY to lower minimum required onsite insurance to $50 million no earlier than April 15, 2016.
The exemption is effective upon issuance.
For the Nuclear Regulatory Commission.
In accordance with the purposes of Sections 29 and 182b of the Atomic Energy Act (42 U.S.C. 2039, 2232b), the Advisory Committee on Reactor Safeguards (ACRS) will hold a meeting on May 5-7, 2016, 11545 Rockville Pike, Rockville, Maryland.
Procedures for the conduct of and participation in ACRS meetings were published in the
Thirty-five hard copies of each presentation or handout should be provided 30 minutes before the meeting. In addition, one electronic copy of each presentation should be emailed to the Cognizant ACRS Staff one day before meeting. If an electronic copy cannot be provided within this timeframe, presenters should provide the Cognizant ACRS Staff with a CD containing each presentation at least 30 minutes before the meeting.
In accordance with Subsection 10(d) of Public Law 92-463 and 5 U.S.C. 552b(c), certain portions of this meeting may be closed, as specifically noted above. Use of still, motion picture, and television cameras during the meeting may be limited to selected portions of the meeting as determined by the Chairman. Electronic recordings will be permitted only during the open portions of the meeting.
ACRS meeting agendas, meeting transcripts, and letter reports are available through the NRC Public Document Room at
Video teleconferencing service is available for observing open sessions of ACRS meetings. Those wishing to use this service should contact Mr. Theron Brown, ACRS Audio Visual Technician (301-415-8066), between 7:30 a.m. and 3:45 p.m. (ET), at least 10 days before the meeting to ensure the availability of this service. Individuals or organizations requesting this service will be responsible for telephone line charges and for providing the equipment and facilities that they use to establish the video teleconferencing link. The availability of video teleconferencing services is not guaranteed.
For the Nuclear Regulatory Commission.
Nuclear Regulatory Commission.
Exemption; issuance.
The U.S. Nuclear Regulatory Commission (NRC) is issuing an exemption in response to a letter from Entergy Nuclear Operations, Inc. (ENO), dated April 17, 2014, requesting an exemption from the NRC's regulations regarding the required level of primary financial protection. An exemption from these regulations would permit Vermont Yankee Nuclear Power Station (VY) to reduce the required level of primary financial protection from $375,000,000 to $100,000,000, and to withdraw from participation in the secondary layer of financial protection, no earlier than April 15, 2016.
April 25, 2016.
Please refer to Docket ID NRC-2016-0017 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document using any of the following methods:
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Jack D. Parrott, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-6634, email:
The VY site is a single unit facility located near the town of Vernon, Vermont. The site is situated in Windham County on the western shore of the Connecticut River, immediately upstream of the Vernon Hydroelectric Station. The VY facility employs a General Electric boiling water reactor nuclear steam supply system licensed to generate 1,912 megawatts-thermal. The boiling water reactor and supporting facilities are owned and operated by Entergy Vermont Yankee, a subsidiary of ENO. The licensee, ENO, is the holder of the Vermont Yankee Renewed Facility Operating License No. DPR-28. The license provides, among other things, that the facility is subject to all rules, regulations, and orders of the NRC now or hereafter in effect.
By letter dated September 23, 2013 (ADAMS Accession No. ML13273A204), ENO submitted a notification to the NRC indicating that it would permanently shut down Vermont Yankee in the fourth calendar quarter of 2014. On December 29, 2014, ENO permanently ceased power operations at VY. On January 12, 2015, ENO certified that it had permanently defueled the Vermont Yankee reactor vessel and placed the fuel in the Spent Fuel Pool (SFP) (ADAMS Accession No. ML15013A426). Accordingly, pursuant to § 50.82(a)(2) of title 10 of the
Pursuant to 10 CFR 140.8, “Specific exemptions,” ENO has requested an exemption from 10 CFR 140.11(a)(4), by letter dated April 17, 2014 (ADAMS Accession No. ML14111A400). The exemption from 10 CFR 140.11(a)(4) would permit the licensee to reduce the required level of primary financial protection from $375,000,000 to $100,000,000, and to withdraw from participation in the secondary layer of financial protection (also known as the secondary retrospective rating pool for deferred premium charges), no earlier than April 15, 2016.
The regulation in 10 CFR 140.11(a)(4) requires each licensee to have and maintain financial protection. For a single unit reactor site, which has a rated capacity of 100,000 kilowatts electric or more, 10 CFR 140.11(a)(4) requires the licensee to maintain $375 million in primary financial protection. In addition, the licensee is required to participate in a secondary retrospective rating pool (secondary financial protection) that commits each licensee to additional indemnification for damages that may exceed primary insurance coverage. Participation in the secondary retrospective rating pool could potentially subject ENO to deferred premium charges up to a maximum total deferred premium of $121,255,000 with respect to any nuclear incident at any operating nuclear power plant, and up to a maximum annual deferred premium of $18,963,000 per incident.
The licensee states that the risk of an offsite radiological release is significantly lower at a nuclear power reactor that has permanently shut down and defueled, when compared to an operating power reactor. Similarly, it states that the associated risk of offsite liability damages that require insurance indemnification is commensurately lower for permanently shut down and defueled plants. The licensee has therefore requested an exemption from 10 CFR 140.11(a)(4) to allow a reduction in offsite liability insurance coverage commensurate with the significantly reduced risks associated with a permanently defueled reactor.
Pursuant to 10 CFR 140.8, the Commission may, upon application of any interested person or upon its own initiative, grant such exemptions from the requirements of the regulations in 10 CFR part 140, when the exemptions are authorized by law and are otherwise in the public interest. The NRC staff has reviewed ENO's request for an exemption from 10 CFR 140.11(a)(4) and has concluded that the requested exemption is authorized by law and is otherwise in the public interest.
The Price Anderson Act of 1957 (PAA) requires that nuclear power reactor licensees have insurance to compensate the public for damages arising from a nuclear incident. Specifically, the PAA requires licensees of facilities with a “rated capacity of 100,000 electrical kilowatts or more” to maintain the maximum amount of primary offsite liability insurance commercially available (currently,
As noted above, the PAA requirements with respect to primary and secondary insurance, and the implementing regulations at 10 CFR 140.11(a)(4), apply to licensees of facilities with a “rated capacity of 100,000 electrical kilowatts or more.” When the NRC issues a license amendment to a decommissioning licensee to reflect the defueled status of the facility, the license amendment includes removal of the rated capacity of the reactor from the license. Accordingly, a reactor that is undergoing decommissioning has no “rated capacity.” Removal of the rated capacity from the facility of a decommissioning licensee, thus, allows the NRC to take the reactor licensee out of the category of reactor licensees that are required to maintain the maximum available insurance and to participate in the secondary retrospective insurance pool under the PAA, subject to a technical finding that lesser potential hazards exist at the facility after termination of operations.
The financial protection limits of 10 CFR 140.11(a)(4) were established to require a licensee to maintain sufficient insurance, as specified under the PAA, to satisfy liability claims by members of the public for personal injury, property damage, and the legal cost associated with lawsuits, as the result of a nuclear accident at an operating reactor with a rated capacity of 100,000 kilowatts electric (or greater). Thus, the insurance levels established by this regulation, as required by the PAA, were associated with the risks and potential consequences of an accident at an operating reactor with a rated capacity of 100,000 kilowatts electric (or greater). The legal and associated technical basis for granting exemptions from 10 CFR part 140 is set forth in SECY-93-127. The legal analysis underlying SECY-93-127 concluded that, upon a technical finding that lesser potential hazards exist after termination of operations (and removal of the rated capacity), the Commission has the discretion under the PAA to reduce the amount of insurance required of a licensee undergoing decommissioning.
As a technical matter, the fact that a reactor has permanently ceased operation is not itself determinative as to whether a licensee may cease providing the offsite liability coverage required by the PAA and 10 CFR 140.11(a)(4). In light of the presence of freshly discharged irradiated fuel in the spent fuel pool at a recently shutdown reactor, the primary consideration is the risk of offsite radiological release from a zirconium fire. That risk generally remains for about 15 to 18 months of decay time for the fuel used in the last cycle of power operation. After that time, the offsite consequences of an offsite radiological release from a zirconium fire are negligible for shutdown reactors, but the spent fuel pool is still operational and an inventory of radioactive materials still exists onsite. Therefore, an evaluation of the potential for offsite damage is necessary to determine the appropriate level of offsite insurance post shutdown, in accordance with the Commission's discretionary authority under the PAA to establish an appropriate level of required financial protection for such shutdown facilities.
The NRC staff has conducted an evaluation and concluded that, aside from the handling, storage, and transportation of spent fuel and radioactive materials for a permanently shut down and defueled reactor, no reasonably conceivable potential accident exists that could cause significant offsite damage. During normal power reactor operations, the forced flow of water through the Reactor Coolant System (RCS) removes heat generated by the reactor. The RCS transfers this heat away from the reactor core by converting reactor feedwater to steam, which then flows to the main turbine generator to produce electricity. Most of the accident scenarios postulated for operating power reactors involve failures or malfunctions of systems that could affect the fuel in the reactor core, which in the most severe postulated accidents, would involve the release of large quantities of fission products. With the permanent cessation of reactor operations at VY and the permanent removal of the fuel from the reactor core, such accidents are no longer possible. The reactor, RCS, and supporting systems no longer operate and have no function related to the storage of the irradiated fuel. Therefore, postulated accidents involving failure or malfunction of the reactor, RCS, or supporting systems are no longer applicable.
During reactor decommissioning, the principal radiological risks are associated with the storage of spent fuel onsite. On a case-by-case basis, licensees undergoing decommissioning have been granted permission to reduce the required amount of primary offsite liability insurance coverage from $375,000,000 to $100,000,000 and to withdraw from the secondary insurance pool.
The only design-basis accident that could potentially result in an offsite radiological release at VY, following its permanent shutdown and defueling, is a Fuel Handling Accident (FHA). However, ENO performed an analysis demonstrating that 17 days after shutdown, the radiological consequences of a FHA would not exceed the limits established by the EPA PAGs at the exclusion area boundary. Accordingly, based on the time that VY has been permanently shutdown (approximately 15 months), the staff has determined that the possibility of an offsite radiological release from a design-basis accident that could exceed the EPA PAGs has been eliminated. Therefore, any offsite consequence from a design basis radiological release is
The only beyond design-basis event that has the potential to lead to a significant radiological release at a permanently shut down and defueled (decommissioning) reactor is a zirconium fire. The zirconium fire scenario is a postulated, but highly unlikely, accident scenario that involves the loss of water inventory from the SFP, resulting in a significant heat-up of the spent fuel and culminating in substantial zirconium cladding oxidation and fuel damage. The probability of a zirconium fire scenario is related to the decay heat of the irradiated fuel stored in the SFP. Therefore, the risks from a zirconium fire scenario continue to decrease as a function of the time that VY has been permanently shut down. The licensee's adiabatic heat-up analyses demonstrate that as of April 15, 2016, there would be at least 10 hours after the loss of all means of cooling (both air and/or water), before the spent fuel cladding would reach a temperature where the potential for a significant offsite radiological release could occur. The NRC staff has confirmed the reduced risks at VY by comparing the generic risk assumptions in the analyses in NUREG-1738, “Technical Study of Spent Fuel Pool Accident Risk at Decommissioning Nuclear Power Plants,” dated February 28, 2001 (ADAMS Accession No. ML010430066) to site-specific conditions at VY; based on this assessment, the staff determined that the risk values in NUREG-1738 bound the risks presented by VY. As indicated by the results of research conducted for NUREG-1738 and more recently, for NUREG-2161, “Consequence Study of a Beyond-Design-Basis Earthquake Affecting the Spent Fuel Pool for a U.S. Mark I Boiling Water Reactor” (ADAMS Accession No. ML14255A365), ENO's analysis of a beyond-design-basis accident involving a complete loss of SFP water inventory, where adequate fuel handling building air exchange with the environment and air cooling of the stored fuel are available, the analyses show that within 15.4 months after shutdown, air cooling of the spent fuel assemblies was sufficient to keep the fuel within a safe temperature range, indefinitely, without fuel cladding damage or offsite radiological release.
In this regard, one technical criterion for relieving decommissioning reactor licensees from the insurance obligations applicable to an operating reactor is a finding that the heat generated by the SFP has decayed to the point where the possibility of a zirconium fire is highly unlikely. This was addressed in SECY-93-127, where the NRC staff concluded that there was a low likelihood and reduced short-term public health consequences of a zirconium fire once a decommissioning plant's spent fuel has sufficiently decayed. In its Staff Requirements Memorandum “Financial Protection Required of Licensees of Large Nuclear Power Plants during Decommissioning,” dated July 13, 1993 (ADAMS Accession No. ML003760936), the Commission approved a policy that authorized, through the exemption process, withdrawal from participation in the secondary insurance layer and a reduction in commercial liability insurance coverage to $100 million, when a licensee is able to demonstrate that the spent fuel could be air-cooled if the SFP was drained of water. The staff has used this technical criterion to grant similar exemptions to other decommissioning reactors (
The NRC staff has determined that the fuel stored in the VY SFP will have decayed sufficiently by the requested effective exemption date of April 15, 2016, to support a reduction in the required insurance. The licensee determined that by April 15, 2016, the fuel removed from the reactor would have sufficiently decayed by 15.4 months after shutdown so as to significantly reduce the risk from SFP draining events (ADAMS Accession No. ML14080A141). The NRC staff has evaluated the issue of zirconium fires in SFPs and presented an independent evaluation of a SFP subject to a severe earthquake in NUREG-2161, “Consequence Study of a Beyond-Design-Basis Earthquake Affecting the Spent Fuel Pool for a U.S. Mark l Boiling Water Reactor,” dated September 2014 (ADAMS Accession No. ML14255A365). This evaluation concluded that, for a representative Boiling-Water Reactor (BWR), fuel in a dispersed high-density configuration would be adequately cooled by natural circulation air flow within several months after discharge from a reactor if the pool was drained of water. By letter dated November 23, 2015 (ADAMS Accession No. ML15329A167), ENO confirmed that the plant design and fuel storage configuration considered in NUREG-2161 were consistent with the VY plant design and fuel storage configurations to be used in the decommissioning of VY. The staff independently confirmed that the VY fuel assembly decay levels are also consistent with the spent fuel considered in NUREG-2161. Thus, the staff has determined that after 15.4 months decay, which will be reached by the requested effective date of April 15, 2016, the fuel stored in the VY SFP will be able to adequately be cooled by air in the unlikely event of pool drainage.
In SECY-00-0145, “Integrated Rulemaking Plan for Nuclear Power Plant Decommissioning,” dated June 28, 2000, and SECY-01-0100, “Policy Issues Related to Safeguards, Insurance, and Emergency Preparedness Regulations at Decommissioning Nuclear Power Plants Storing Fuel in Spent Fuel Pools,” dated June 4, 2001 (ADAMS Accession Nos. ML003721626 and ML011450420, respectively), the staff discussed additional information concerning SFP zirconium fire risks at decommissioning reactors and associated implications for offsite insurance. Analyzing when the spent fuel stored in the SFP is capable of adequate air-cooling is one measure that demonstrates when the probability of a zirconium fire would be exceedingly low.
The licensee's analyses referenced in its exemption request demonstrate that under conditions where the SFP water inventory has drained and only air-cooling of the stored irradiated fuel is available, there is reasonable assurance as of April 15, 2016, that the VY spent fuel will remain at temperatures far below those associated with a significant radiological release. In addition, the licensee performed adiabatic heat-up analyses, in which a complete drainage of the SFP is combined with rearrangement of spent fuel rack geometry and/or the addition of rubble to the SFP; this type of analysis postulates that decay heat
In the NRC staff's safety evaluation of the licensee's March 14, 2014 (as later supplemented) request for exemptions from certain emergency planning requirements dated December 10, 2015 (ADAMS Accession No. ML15180A054), the NRC staff assessed the ENO accident analyses associated with the radiological risks from a zirconium fire at the permanently shut down and defueled VY site. For the very unlikely beyond design-basis accident scenario where the SFP coolant inventory is lost in such a manner that all methods of heat removal from the spent fuel are no longer available, the staff found there will be a minimum of 10 hours from the initiation of the accident until the cladding reaches a temperature where offsite radiological release might occur. The staff finds that 10 hours is sufficient time to support deployment of mitigation equipment, consistent with plant conditions, to prevent the zirconium cladding from reaching a point of rapid oxidation.
The staff has determined that the licensee's proposed reduction in primary offsite liability coverage to a level of $100 million, and the licensee's proposed withdrawal from participation in the secondary insurance pool for offsite financial protection, are consistent with the policy established in SECY-93-127 and subsequent insurance considerations resulting from zirconium fire risks, as discussed in SECY-00-0145 and SECY-01-0100. The NRC has previously determined in SECY-00-0145 that the minimum offsite financial protection requirement may be reduced to $100 million and that secondary insurance is not required, once it is determined that the spent fuel in the spent fuel pool is no longer thermal-hydraulically capable of sustaining a zirconium fire based on a plant-specific analysis. In addition, the NRC staff notes that there is a well-established precedent of granting a similar exemption from these insurance requirements, to other permanently shutdown and defueled power reactors, upon satisfactory demonstration that zirconium fire risk from the irradiated fuel stored in the SFP is of negligible concern.
The PAA, and its implementing regulations in 10 CFR 140.11(a)(4), require licensees of nuclear reactors that have a rated capacity of 100,000 kilowatts electric or more to have and maintain $375 million in primary financial protection and to participate in a secondary retrospective insurance pool. In accordance with 10 CFR 140.8, the Commission may grant exemptions from the regulations in 10 CFR part 140, as the Commission determines are authorized by law. The legal and associated technical basis for granting exemptions from 10 CFR part 140 are set forth in SECY-93-127. The legal analysis underlying SECY-93-127 concluded that, upon a technical finding that lesser potential hazards exist after termination of operations, the Commission has the discretion under the Price-Anderson Act to reduce the amount of insurance required of a licensee undergoing decommissioning.
Based on its review of ENO's exemption request, the staff concludes that the technical criteria for relieving ENO from its existing primary and secondary insurance obligations have been met. As explained above, the staff has concluded that no reasonably conceivable design-basis accident exists that could cause an offsite release greater than the EPA PAGs, and therefore, that any offsite consequence from a design basis radiological release is unlikely, and the need for a significant amount of offsite liability insurance coverage is unwarranted. Additionally, the Staff determined that, after 15.4 months decay, which will be reached by the requested effective date of April 15, 2016, the fuel stored in the VY SFP will be able to adequately be cooled by air in the unlikely event of pool drainage. Moreover, in the very unlikely beyond design-basis accident scenario where the SFP coolant inventory is lost in such a manner that all methods of heat removal from the spent fuel are no longer available, the staff has determined that 10 hours would be available and is sufficient time to support deployment of mitigation equipment, consistent with plant conditions, to prevent the zirconium cladding from reaching a point of rapid oxidation. Thus, the staff concludes that the fuel stored in the VY SFP will have decayed sufficiently by the requested effective exemption date of April 15, 2016, to support a reduction in the required insurance consistent with SECY-00-0145.
The NRC staff has determined that granting of the licensee's proposed exemption will not result in a violation of the Atomic Energy Act of 1954, Section 170, or other laws, as amended, which require licensees to maintain adequate financial protection. Accordingly, consistent with the legal standard presented in SECY-93-127, under which decommissioning reactor licensees may be relieved of the requirements to carry the maximum amount of insurance available and to participate in the secondary retrospective premium pool where there is sufficient technical justification, the NRC staff concludes that the requested exemption is authorized by law.
The financial protection limits of 10 CFR 140.11 were established to require licensees to maintain sufficient offsite liability insurance to ensure adequate funding for offsite liability claims, following an accident at an operating reactor. However, the regulation does not consider the reduced potential for and consequence of nuclear incidents at permanently shutdown and decommissioning reactors.
SECY-93-127, SECY-00-0145, and SECY-01-0100 provide a basis for allowing licensees of decommissioning plants to reduce their primary offsite liability insurance and to withdraw from participation in the retrospective rating pool for deferred premium charges. As discussed in these documents, once the zirconium fire concern is determined to be negligible, possible accident scenario risks at permanently shutdown and defueled reactors are greatly reduced, when compared to the risks at operating reactors, and the associated potential for offsite financial liabilities from an
Additionally, participation in the secondary retrospective rating pool could potentially have adverse consequences on the safe and timely completion of decommissioning. If a nuclear incident sufficient to trigger the secondary insurance layer occurred at another nuclear power plant, the licensee could incur financial liability of up to $121,255,000. However, because VY is permanently shut down, it cannot produce revenue from electricity generation sales to cover such a liability. Therefore, such liability if subsequently incurred, could significantly affect the ability of the facility to conduct and complete timely radiological decontamination and decommissioning activities. In addition, as SECY-93-127 concluded, the shared financial risk exposure to ENO is greatly disproportionate to the radiological risk posed by VY, when compared to operating reactors.
The reduced overall risk to the public at decommissioning power plants does not warrant that ENO be required to carry full operating reactor insurance coverage, after the requisite spent fuel cooling period has elapsed following final reactor shutdown. The licensee's proposed financial protection limits will maintain a level of liability insurance coverage commensurate with the risk to the public. These changes are consistent with previous NRC policy as discussed in NUREG-00-0145, and exemptions approved for other decommissioning reactors. Thus, the underlying purpose of the regulations will not be adversely affected by the reductions in insurance coverage. Accordingly, an exemption from participation in the secondary insurance pool and a reduction in the primary insurance to $100 million, a value more in line with the potential consequences of accidents, would be in the public interest in that this assures there will be adequate funds to address any of those consequences and helps to assure the safe and timely decommissioning of the reactor.
Therefore, the NRC staff has concluded that an exemption from 10 CFR 140.11(a)(4), which would permit ENO to lower the VY primary insurance levels and to withdraw from the secondary retrospective premium pool at the requested effective date of April 15, 2016, is in the public interest.
NRC approval of an exemption from insurance or indemnity requirements belongs to a category of actions that the Commission, by rule or regulation, has declared to be a categorical exclusion, after first finding that the category of actions does not individually or cumulatively have a significant effect on the human environment. Specifically, the exemption is categorically excluded from the requirement to prepare an environmental assessment or environmental impact statement, in accordance with 10 CFR 51.22(c)(25).
Under 10 CFR 51.22(c)(25), granting of an exemption from the requirements of any regulation of Chapter I to 10 CFR is a categorical exclusion provided that: (i) There is no significant hazards consideration; (ii) there is no significant change in the types or significant increase in the amounts of any effluents that may be released offsite; (iii) there is no significant increase in individual or cumulative public or occupational radiation exposure; (iv) there is no significant construction impact; (v) there is no significant increase in the potential for or consequences from radiological accidents; and (vi) the requirements from which an exemption is sought involve surety, insurance, or indemnity requirements.
The Director, Division of Decommissioning, Uranium Recovery and Waste Programs, Office of Nuclear Material Safety and Safeguards, has determined that approval of the exemption request involves no significant hazards consideration, as defined in 10 CFR 50.92, because reducing a licensee's offsite liability requirements at VY does not: (1) Involve a significant increase in the probability or consequences of an accident previously evaluated; (2) create the possibility of a new or different kind of accident from any accident previously evaluated; or (3) involve a significant reduction in a margin of safety. The exempted financial protection regulation is unrelated to the operation of VY or site activities. Accordingly, there is no significant change in the types or significant increase in the amounts of any effluents that may be released offsite, and no significant increase in individual or cumulative public or occupational radiation exposure. The exempted regulation is not associated with construction, so there is no significant construction impact. The exempted regulation does not concern the source term (
Therefore, pursuant to 10 CFR 51.22(b) and 51.22(c)(25), no environmental impact statement or environmental assessment need be prepared in connection with the approval of this exemption request.
Accordingly, the Commission has determined that, pursuant to 10 CFR 140.8, the exemption is authorized by law, and is otherwise in the public interest. Therefore, the Commission hereby grants ENO an exemption from the requirements of 10 CFR 140.11(a)(4) for VY. The exemption from 10 CFR 140.11(a)(4) permits VY to reduce the required level of primary financial protection, from $375,000,000 to $100,000,000, and to withdraw from participation in the secondary layer of financial protection no earlier than April 15, 2016.
The exemption is effective upon issuance.
For the Nuclear Regulatory Commission.
Nuclear Regulatory Commission.
Notice of availability.
The U.S. Nuclear Regulatory Commission (NRC) is providing for public information its Inventory of Contracts for Services and Inventory Supplement for Fiscal Year (FY) 2015. The inventory includes service contract actions over $25,000 that were awarded in FY 2015. The inventory supplement includes information collected from
April 25, 2016.
Please refer to Docket ID NRC-2015-0274 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document using any of the following methods:
•
•
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Lori Konovitz, Office of Administration, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-0039, email:
In accordance with Section 743 of Division C of the FY 2010 Consolidated Appropriations Act, Public Law 111-117, the NRC is publishing this notice to advise the public of the availability of its FY 2015 Service Contracts Inventory and Inventory Supplement.
The inventory provides information on service contract actions over $25,000 that were awarded in FY 2015. The information is organized by function to show how contracted resources are distributed throughout the agency. The inventory contains the following data:
1. A description of the services purchased;
2. The role the contracted services played in achieving agency objectives;
3. The total dollar amount obligated for the services under the contract, and the funding source for the contract;
4. The contract type and date of the award;
5. The name of the contractor and place of performance;
6. Whether the contract is a personal services contract; and
7. Whether the contract was awarded on a non-competitive basis.
The inventory supplement includes information collected from contractors for covered contracts on the amount invoiced for services and the number of contractor and first-tier subcontractor employees, expressed as full-time equivalents for direct labor, compensated under the contract.
The NRC will analyze the data for the purpose of determining if its contract labor is being used in an effective and appropriate manner and if the mix of federal employees and contractors in the agency is effectively balanced. The inventory and supplement do not include contractor proprietary or sensitive information.
For the Nuclear Regulatory Commission.
Overseas Private Investment Corporation (OPIC).
Notice and request for comments.
Under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35), agencies are required to publish a Notice in the
Comments must be received within thirty (30) calendar days of publication of this Notice.
Mail all comments and requests for copies of the subject form to OPIC's Agency Submitting Officer: James Bobbitt, Overseas Private Investment Corporation, 1100 New York Avenue NW., Washington, DC 20527. See
OPIC Agency Submitting Officer: James Bobbitt, (202) 336-8558.
OPIC received no comments in response to the sixty (60) day notice published in the
Postal Regulatory Commission.
Notice.
The Commission is noticing a proceeding to consider whether proposals of the 26th Congress of the Universal Postal Union are consistent with the modern rate regulation standards of 39 U.S.C. 3622. This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
David A. Trissell, General Counsel, at 202-789-6820.
On April 1, 2016, the Secretary of State requested the Commission's views on whether certain proposals for the 26th Congress of the Universal Postal Union are consistent with the standards and criteria for modern rate regulation established by the Commission under 39 U.S.C. 3622.
Pursuant to section 407(c)(1) and 39 CFR part 3017, the Commission establishes Docket No. IM2016-1 for the purpose of developing its views on matters referred to in State's Request.
1. The Commission establishes Docket No. IM2016-1 for purposes related to the development of section 407(c)(1) views and invites public comments related to this effort, as described in the body of this Order.
2. Comments are due no later than July 21, 2016.
3. Pursuant to 39 U.S.C. 505, Kenneth E. Richardson is appointed to serve as an officer of the Commission (Public Representative) to represent the interests of the general public in this docket.
4. The Secretary is directed to post the correspondence referred to in this Order on the Commission's Web site, along with other documents the Commission may determine should be made publicly available.
5. The Secretary shall arrange for publication of this order in the
By the Commission.
Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Public Law 94-409, that the Securities and Exchange Commission will hold a Closed Meeting on Thursday, April 28, 2016 at 1:00 p.m.
Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries will attend the Closed Meeting. Certain
The General Counsel of the Commission, or her designee, has certified that, in her opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) and 17 CFR 200.402(a)(3), (5), (7), 9(ii) and (10), permit consideration of the scheduled matter at the Closed Meeting.
Commissioner Piwowar, as duty officer, voted to consider the items listed for the Closed Meeting in closed session.
The subject matter of the Closed Meeting will be:
At times, changes in Commission priorities require alterations in the scheduling of meeting items.
For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact the Office of the Secretary at (202) 551-5400.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to delete Rule 971, entitled “Termination of Memberships and Equity Trading Permits and Leases and A-B-C Agreements Relating to Memberships and ETP Use Agreements,” to delete Rule 972, entitled “Continuation of Status After the NASDAQ OMX Merger,” and to make conforming changes to other rules. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to delete certain Phlx rules in order to remove outdated material from the Exchange's Rulebook. Specifically, the Exchange proposes to delete Rule 971, entitled “Termination of Memberships and Equity Trading Permits and Leases and A-B-C Agreements Relating to Memberships and ETP Use Agreements”; and Rule 972, entitled “Continuation of Status After the NASDAQ OMX Merger.” The Exchange also proposes to make conforming changes to rules that reference the rules that are being deleted.
Rule 971 pertained to the demutualization of the Exchange in 2004. As provided in the rule, demutualization resulted in the termination of memberships and equity trading permits (“ETP”),
Rule 972 pertains to the merger in 2008 through which The NASDAQ OMX Group, Inc. (since, renamed Nasdaq, Inc.) acquired ownership of the Exchange. The rule provides that the status of members, inactive nominees, and member organizations under Exchange rules would not be affected by the acquisition, and that likewise any existing suspension would not be affected. Since the rule fully achieved its purpose at the time of the acquisition of the Exchange in 2008, the Exchange believes that maintaining the rule in the Exchange's rulebook is no longer necessary.
The Exchange is also amending Rules 908 (“Rights and Privileges of A-1 Permits”) and 3202 (“Application of Other Rules of the Exchange”) to remove references to Rule 972, and amending Rule 900 (“Administration of Rules by Membership Department”) to remove references to Rules 971 and 972.
The Exchange believes that its proposal is consistent with Section 6(b) of the Act,
The Exchange believes that Rules 971 and 972 are no longer necessary, since they were fully effective [sic] at the time of the Exchange's demutualization and its acquisition by The NASDAQ OMX Group, Inc., respectively. Accordingly, removing the rules from the Exchange's rulebook will perfect the mechanism of a free and open market by eliminating rules that are unnecessary and potentially confusing to member organizations.
The proposed rule change does not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange's proposed amendments seek to delete certain obsolete rules. Because the change will not alter the rights or obligations of member organizations in any respect, the Exchange believes that the change will not affect competition in any respect.
No written comments were either solicited or received.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is: (i) Necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. The Exchange has provided the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-Phlx-2016-49 and should be submitted on or before May 16, 2016.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Public Law 94-409, that the Securities and Exchange Commission Equity Market Structure Advisory Committee will hold a public meeting on Tuesday, April 26, 2016, in the Multipurpose Room, LL-006 at the Commission's headquarters, 100 F Street NE., Washington, DC.
The meeting will begin at 9:30 a.m. (EDT) and will be open to the public. Seating will be on a first-come, first-served basis. Doors will be open at 9:00 a.m. Visitors will be subject to security checks. The meeting will be webcast on the Commission's Web site at
On April 6, 2016, the Commission published notice of the Committee meeting (Release No. 34-77543), indicating that the meeting is open to the public and inviting the public to submit written comments to the Committee. This Sunshine Act notice is being issued because a majority of the Commission may attend the meeting.
The agenda for the meeting will focus on status reports and potential recommendations from the four subcommittees.
For further information, please contact the Office of the Secretary at (202) 551-5400.
Notice is hereby given that, pursuant to the provisions of the Government in the Sunshine Act, Public Law 94-409, the Securities and Exchange Commission will hold an Open Meeting on Wednesday, April 27, 2016 at 10:00 a.m. in the Auditorium, Room L-002.
The subject matter of the Open Meeting will be:
1. The Commission will consider whether to publish for comment a proposed national market system (“NMS”) plan to create, implement, and maintain a consolidated audit trail (“CAT”), submitted pursuant to Rule 613 of Regulation NMS.
At times, changes in Commission priorities require alterations in the scheduling of meeting items.
For further information and to ascertain what, if any, matters have been added, deleted, or postponed, please contact: The Office of the Secretary at (202) 551-5400.
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Gold Hills Mining Ltd. (CIK No. 1129018), a revoked Nevada corporation with its principal place of business listed as New York, New York with stock quoted on OTC Link (previously, “Pink Sheets”) operated by OTC Markets Group Inc. (“OTC Link”) under the ticker symbol GHML, because it has not filed any periodic reports since the period ended March 31, 2013. On August 19, 2015, a delinquency letter was sent by the Division of Corporation Finance to Gold Hills Mining Ltd. requesting compliance with its periodic filing obligations, and Gold Hills Mining Ltd. received the delinquency letter on August 21, 2015, but failed to cure its delinquencies.
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Massive Dynamics, Inc. (CIK No. 1519534), a revoked Nevada corporation with its principal place of business listed as Rochester, New York with stock quoted on OTC Link under the ticker symbol MSSD, because it has not filed any periodic reports since the period ended June 30, 2013. On August 19, 2015, a delinquency letter was sent by the Division of Corporation Finance to Massive Dynamics, Inc. requesting compliance with its periodic filing obligations, and Massive Dynamics, Inc. received the delinquency letter on August 24, 2015, but failed to cure its delinquencies.
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Medisafe 1 Technologies Corp. (CIK No. 1471487), a void Delaware corporation with its principal place of business listed as Jerusalem, Israel with stock quoted on OTC Link under the ticker symbol MFTH, because it has not filed any periodic reports since the period ended June 30, 2013. On August 18, 2015, a delinquency letter was sent by the Division of Corporation Finance to Medisafe 1 Technologies Corp. requesting compliance with its periodic filing obligations, but Medisafe 1 Technologies Corp. did not receive the delinquency letter due to its failure to maintain a valid address on file with the Commission as required by Commission rules (Rule 301 of Regulation S-T, 17 CFR 232.301 and Section 5.4 of EDGAR Filer Manual).
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of MDU Communications International, Inc. (CIK No. 1086139), a void Delaware corporation with its principal place of business listed as Totowa, New Jersey with stock quoted on OTC Link under the ticker symbol MDTV, because it has not filed any periodic reports since the period ended June 30, 2013. On August 19, 2015, a delinquency letter was sent by the Division of Corporation Finance to MDU Communications International, Inc. requesting compliance with its periodic filing obligations, but MDU Communications International, Inc. did not receive the delinquency letter due to its failure to maintain a valid address on file with the Commission as required by Commission rules (Rule 301 of Regulation S-T, 17 CFR 232.301 and Section 5.4 of EDGAR Filer Manual).
The Commission is of the opinion that the public interest and the protection of investors require a suspension of trading in the securities of the above-listed companies.
Therefore, it is ordered, pursuant to Section 12(k) of the Securities Exchange Act of 1934, that trading in the securities of the above-listed companies is suspended for the period from 9:30 a.m. EDT on April 21, 2016, through 11:59 p.m. EDT on May 4, 2016.
By the Commission.
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of CelLynx Group, Inc. (CIK No. 1067286), a defaulted Nevada corporation with its principal place of business listed as Miami, Florida with stock quoted on OTC Link (previously, “Pink Sheets”) operated by OTC Markets Group Inc. (“OTC Link”) under the ticker symbol CYNX, because it has not filed any periodic reports since the period ended March 31, 2013. On August 19, 2015, a delinquency letter was sent by the Division of Corporation Finance to CelLynx Group, Inc. requesting compliance with its periodic filing obligations, but CelLynx Group, Inc. did not receive the delinquency letter due to its failure to maintain a valid address on file with the Commission as required by Commission rules (Rule 301 of Regulation S-T, 17 CFR 232.301 and Section 5.4 of EDGAR Filer Manual).
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Dot VN, Inc. (CIK No. 1412130), a delinquent Delaware corporation with its principal place of business listed as San Diego, California with stock quoted on OTC Link under the ticker symbol DTVI, because it has not filed any periodic reports since the period ended January 31, 2012. On November 7, 2013, a delinquency letter was sent by the Division of Corporation Finance to Dot VN, Inc. requesting compliance with its periodic filing obligations, and Dot VN, Inc. received the delinquency letter in November 2013, but failed to cure its delinquencies.
It appears to the Securities and Exchange Commission that there is a lack of current and accurate information concerning the securities of Global Health Voyager, Inc. (CIK No. 318622), a void Delaware corporation with its principal place of business listed as Los Angeles, California with stock quoted
The Commission is of the opinion that the public interest and the protection of investors require a suspension of trading in the securities of the above-listed companies.
Therefore, it is ordered, pursuant to Section 12(k) of the Securities Exchange Act of 1934, that trading in the securities of the above-listed companies is suspended for the period from 9:30 a.m. EDT on April 21, 2016, through 11:59 p.m. EDT on May 4, 2016.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
CHX proposes amend its Schedule of Fees and Assessments (the “Fee Schedule”) to adopt the CHX SNAP Incentive Program. The text of this proposed rule change is available on the Exchange's Web site at (
In its filing with the Commission, the CHX included statements concerning the purpose of and basis for the proposed rule changes and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The CHX has prepared summaries, set forth in sections A, B and C below, of the most significant aspects of such statements.
The Exchange proposes to adopt the CHX Sub-second Non-displayed Auction Process (“SNAP”) Incentive Program (“SAIP”). On October 6, 2015, the Securities and Exchange Commission (“SEC”) approved the Exchange's proposed rule change to adopt SNAP, an intra-day on-demand auction service, which would be initiated on the Exchange in a security upon receipt of a valid Start SNAP order submitted by a Participant.
The Exchange now proposes to adopt the SAIP to further incentivize Participants to
Proposed Section Q further provides that Part 1 will end upon attribution of the SAIP rebate (or rebates, if two or more SNAP Cycles with eligible executed shares were initiated in different securities at precisely the same time) that results in either -1- $50,000 of total rebates attributed or -2- over $50,000 total rebates attributed if the total rebates attributed immediately prior to the attribution of the relevant SAIP rebate(s) was less than $50,000. Moreover, Part 2 will end upon attribution of the SAIP rebate (or rebates, if two or more SNAP Cycles
The Exchange notes that the initiating Participant may receive a SAIP rebate even if its Start SNAP order did not receive any executions. This may result if the SNAP Price
The following examples illustrate how the SAIP rebates would be attributed pursuant to proposed Section Q:
Under this Example 1, the SAIP rebate attributed to Participant A would be $250.00, even though the product of $0.0050 per eligible executed share and 70,000 eligible executed shares is $350.00, because SAIP rebates are capped at $250.00 during Part 1. Moreover, since the SAIP rebate attributed to Participant A would result in at least $50,000 total SAIP rebates attributed (
Under this Example 2, the SAIP rebate attributed to Participant B would be $100.00 because the SAIP is in Part 2 and the product of $0.0025 per eligible share and 40,000 eligible executed shares is $100.00. Moreover, since the SAIP rebate attributed to Participant B would result in at least $100,000 total SAIP rebates attributed (
Under this Example 3, both Participant B and C would receive a SAIP rebate of $100.00 because the Exchange was not able to ascertain precisely which SNAP Cycle was initiated first. The SAIP would then be terminated.
After the conclusion of each trading day, the Exchange will calculate the aggregate number of eligible executed shares from all previous trading days. Based on this figure, the Exchange will notify Participants via Information Memorandum prior to the next trading day that Part 1 or Part 2 of the SAIP had concluded on the previous trading day, as applicable. After the conclusion of the SAIP, the Exchange will file a proposed rule change to either extend or eliminate the SAIP.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange operates in a highly competitive market in which market participants can readily direct order flow to competing venues if they deem fee levels set by the Exchange to be excessive. The Exchange believes that the proposed SAIP will encourage Participants to initiate SNAP Cycles, which is an innovative trading functionality that addresses a market need.
No written comments were either solicited or received.
The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A)(ii) of the Act
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange proposes to amend its Fees Schedule. The text of the proposed rule change is available on the Exchange's Web site at (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The Exchange proposes to amend its Fees Schedule.
Specifically, the Exchange proposes to adopt the following rates for simple and complex orders in all equity, multiply-listed index, ETF and ETN non-Penny option classes. Listed rates are per contract.
The Exchange notes that the proposed fees are similar to those adopted on other Exchanges.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
The Exchange believes that it is equitable and not unfairly discriminatory to assess lower fees to Public Customers as compared to other market participants and to provide higher rebates to Public Customers as compared to other market participants because Public Customer order flow enhances liquidity on the Exchange for the benefit of all market participants. Specifically, Public Customer liquidity benefits all market participants by providing more trading opportunities, which attracts Market-Makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants. Moreover, the options industry has a long history of providing preferential pricing to Public Customers. Finally, all fee and rebate amounts listed as applying to Public Customers will be applied equally to all Public Customers.
The Exchange believes that it is equitable and not unfairly discriminatory to assess lower fees to Market-Makers as compared to other market participants other than Public Customers and provide higher rebates to Market-Makers as compared to other market participants other than Public Customers because Market-Makers, unlike other C2 market participants, take on a number of obligations, including quoting obligations, that other market participants do not have. Further, these lower fees and higher rebates offered to Market-Makers are intended to incent Market-Makers to quote and trade more on the Exchange, thereby providing more trading opportunities for all market participants. Finally, all fee and rebate amounts listed as applying to Market-Makers will be applied equally to all Market-Makers.
The Exchange also believes it is equitable and not unfairly discriminatory to assess higher fees and lower rebates to all other origins (
The Exchange believes it's reasonable, equitable and not unfairly discriminatory to assess no fees and offer no rebates for Trades on the Open because trades on the Open involve the matching of undisplayed pre-opening trading interest. As such, there is, in effect, no Maker or Taker activity occurring. Additionally, the Exchange would like to encourage users to submit pre-opening orders.
The Exchange lastly believes it's equitable and not unfairly discriminatory to assess higher fees and rebates for non-Penny option classes than Penny option classes because Penny classes and non-Penny classes offer different pricing, liquidity, spread and trading incentives. The spreads in Penny classes are tighter than those in non-Penny classes (which trade in $0.05 increments). The wider spreads in non-Penny option classes allow for greater profit potential. Further, a number of options exchanges offer different pricing for Penny and non-Penny option classes.
C2 does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed rule change will impose any burden on intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because, while different fees and rebates are assessed to different market participants, these different market participants have different obligations and different circumstances (as described in the “Statutory Basis” section above). For example, Public Customers order flow, as discussed above, enhances liquidity on the Exchange for the benefit of all market participants. There is also a history in the options markets of providing preferential treatment to Public Customers. Additionally, Market-Makers have quoting obligations that other market participants do not have.
The Exchange does not believe that the proposed change will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act
The Exchange neither solicited nor received comments on the proposed rule change.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
The Social Security Administration (SSA) publishes a list of information collection packages requiring clearance by the Office of Management and Budget (OMB) in compliance with Public Law 104-13, the Paperwork Reduction Act of 1995, effective October 1, 1995. This notice includes revisions of OMB-approved information collections.
SSA is soliciting comments on the accuracy of the agency's burden estimate; the need for the information; its practical utility; ways to enhance its quality, utility, and clarity; and ways to minimize burden on respondents, including the use of automated collection techniques or other forms of information technology. Mail, email, or fax your comments and recommendations on the information collection(s) to the OMB Desk Officer and SSA Reports Clearance Officer at the following addresses or fax numbers. (OMB), Office of Management and Budget, Attn: Desk Officer for SSA, Fax: 202-395-6974, Email address:
(SSA), Social Security Administration, OLCA, Attn: Reports Clearance Director, 3100 West High Rise, 6401 Security Blvd., Baltimore, MD 21235, Fax: 410-966-2830, Email address:
Or you may submit your comments online through
I. The information collection below is pending at SSA. SSA will submit it to OMB within 60 days from the date of this notice. To be sure we consider your comments, we must receive them no later than June 24, 2016. Individuals can obtain copies of the collection instruments by writing to the above email address.
Report to United States Social Security Administration by Person Receiving Benefits for a Child or for an Adult Unable to Handle Funds/Report to the United States Social Security Administration—0960-0049. Section 203(c) of the Social Security Act (Act) requires the Commissioner of SSA to make benefit deductions from the following categories: (1) Entitled individuals who engage in remunerative activity outside of the United States in excess of 45 hours a month; and (2) beneficiaries who fail to have in their care the specified entitled child beneficiaries. SSA uses Forms SSA-7161-OCR-SM and SSA-7162-OCR-SM to: (1) Determine continuing entitlement to Social Security benefits; (2) correct benefit amounts for beneficiaries outside the United States; and (3) monitor the performance of representative payees outside the United States. This collection is mandatory as an annual (or every other year, depending on the country of residence) review for fraud prevention. In addition, the results can affect benefits by increasing or decreasing payment amount or by causing SSA to suspend or terminate benefits. The respondents are individuals living outside the United States who are receiving benefits on their own (or on
Type of Request: Revision of an OMB-approved information collection.
II. SSA submitted the information collections below to OMB for clearance. Your comments regarding the information collections would be most useful if OMB and SSA receive them 30 days from the date of this publication. To be sure we consider your comments, we must receive them no later than May 25, 2016. Individuals can obtain copies of the OMB clearance packages by writing to
1. Request to be Selected as a Payee—20 CFR 404.2010-404.2055, 416.601-416.665—0960-0014. SSA requires an individual applying to be a representative payee for a Social Security beneficiary or Supplemental Security Income (SSI) recipient to complete Form SSA-11-BK. SSA obtains information from applicant payees regarding their relationship to the beneficiary, personal qualifications; concern for the beneficiary's well-being; and intended use of benefits if appointed as payee. The respondents are individuals, private sector businesses and institutions, and State and local government institutions and agencies applying to become representative payees.
Type of Request: Revision of an OMB approved information collection.
2. Application for Benefits Under the Italy-U.S. International Social Security Agreement—20 CFR 404.1925—0960-0445. As per the November 1, 1978 agreement between the United States and Italian Social Security agencies, residents of Italy filing an application for U.S. Social Security benefits directly with one of the Italian Social Security agencies must complete Form SSA-2528. SSA uses Form SSA-2528 to establish age, relationship, citizenship, marriage, death, military service, or to evaluate a family bible or other family record when determining eligibility for benefits. The Italian Social Security agencies assist applicants in completing Form SSA-2528, and then forward the
Type of Request: Revision of an OMB-approved information collection.
3. Child Care Dropout Questionnaire—20 CFR 404.211(e)(4)—0960-0474. If individuals applying for title II disability benefits care for their own or their spouse's children under age 3, and have no steady earnings during the time they care for those children, they may exclude that period of care from the disability computation period. We call this the child-care dropout exclusion. SSA uses the information from Form SSA-4162 to determine if an individual qualifies for this exclusion. Respondents are applicants for title II disability benefits.
Type of Request: Revision of an OMB-approved information collection.
4. Certification of Contents of Document(s) or Record(s)—20 CFR 404.715—0960-0689. SSA established procedures for individuals to provide the evidence necessary to establish their rights to Social Security benefits. Examples of such evidence categories include age, relationship, citizenship, marriage, death, and military service. Form SSA-704 allows SSA employees; State record custodians; and other custodians of evidentiary documents to certify and record information from original documents and records under their custodial ownership to establish these types of evidence. SSA uses Form SSA-704 in situations where individuals cannot produce the original evidentiary documentation required to establish benefits eligibility. The respondents are State record custodians and other custodians of evidentiary documents.
Type of Request: Revision of an OMB-approved information collection.
5. Supplemental Security Income Wage Reporting (Telephone and Mobile)—20 CFR 416.701-732—0960-0715. SSA requires SSI recipients to report changes which could affect their eligibility for, and the amount of, their SSI payments, such as changes in income, resources, and living arrangements. SSA's SSI Telephone Wage Reporting (SSITWR) and SSI Mobile Wage Reporting (SSIMWR) enable SSI recipients to meet these requirements via an automated mechanism to report their monthly wages by telephone and mobile application, instead of contacting their local field offices. The SSITWR allows callers to report their wages by speaking their responses through voice recognition technology, or by keying in responses using a telephone key pad. The SSIMWR allows recipients to report their wages through the mobile wage reporting application on their smartphone. SSITWR and SSIMWR systems collect the same information and send it to SSA over secure channels. To ensure the security of the information provided, SSITWR and SSIMWR ask respondents to provide information SSA can compare against our records for authentication purposes. Once the system authenticates the identity of the respondents, they can report their wage data. The respondents are SSI recipients, deemors, or their representative payees.
Type of Request: Revision of an OMB-approved information collection.
The Surface Transportation Board has received a request from the Georgetown Center for Business and Public Policy (WB16-16-4/20/16) for permission to use certain unmasked data from the Board's 1984-2014 Carload Waybill Samples. A copy of this request may be obtained from the Office of Economics.
The waybill sample contains confidential railroad and shipper data; therefore, if any parties object to these requests, they should file their objections with the Director of the Board's Office of Economics within 14 calendar days of the date of this notice. The rules for release of waybill data are codified at 49 CFR 1244.9.
Surface Transportation Board.
Correction to notice of exemption.
On April 4, 2016, West Branch Intermediate Holdings, LLC and Continental Rail, LLC, both noncarriers, filed a verified notice of exemption pursuant to 49 CFR 1180.2(d)(2) to continue in control of Central Gulf Acquisition Company (CGAC) upon CGAC's becoming a Class III rail carrier.
On April 20, 2016, notice of the exemption was served and published in the
Board decisions and notices are available on our Web site at
By the Board, Joseph H. Dettmar, Acting Director, Office of Proceedings.
Surface Transportation Board.
Notice of construction and operation exemption.
The Board is granting an exemption under 49 U.S.C. 10502 from the prior approval requirements of 49 U.S.C. 10901 for Northwest Tennessee Regional Port Authority (NWTRPA) to construct and operate approximately 5.5 miles of new rail line in Lake County, Tenn. (the Line). The Line would extend from a connection with an existing line of railroad near Tiptonville, Tenn., to the site of a newly constructed port on the Mississippi River at Cates Landing (Port). The Line would serve the Port as well as a new industrial park being developed by Lake County in conjunction with the Port. The purpose of the proposed construction is to attract industrial and commercial activity in Lake County and to provide rail service to an area that does not currently have it. This exemption is subject to environmental mitigation conditions and the requirement that NWTRPA build the environmentally preferable route (the route designated as Alternative A).
The exemption will become effective on May 21, 2016; petitions to reconsider or reopen must be filed by May 11, 2016.
An original and 10 copies of all pleadings, referring to Docket No. FD 35802 must be filed with the Surface Transportation Board, 395 E Street SW., Washington, DC 20423-0001. In addition, one copy of each filing must be served on petitioner's representative: John D. Heffner, Strasburger & Price, LLP, 1025 Connecticut Ave. NW., Suite 717, Washington, DC 20036.
Scott Zimmerman at (202) 245-0386. Assistance for the hearing impaired is available through the Federal Information Relay Services (FIRS) at 1-800-877-8339.
Additional information is contained in the Board's decision. Board decisions and notices are available on our Web site at
By the Board, Chairman Elliott, Vice Chairman Miller, and Commissioner Begeman.
Federal Highway Administration (FHWA), DOT.
Notice of intent to establish the Tribal Transportation Self Governance Program Negotiated Rulemaking Committee; request for comments and nominations.
The FHWA is announcing its intent to establish a negotiated rulemaking committee to develop a proposed rule to carry the Tribal Transportation Self-Governance Program (TTSGP) as required by Section 1121 of the Fixing America's Surface Transportation (FAST) Act. The FHWA will select the tribal representatives for the committee from among elected officials of tribal governments (or their designated employees with authority to act on their behalf), acting in their official capacities and whose tribes have existing Title 23 U.S.C. funding agreements with the Department. To the maximum extent possible, FHWA will consider geographical location, size, and existing transportation and self-governance experience, in selecting tribal committee representatives. Per the FAST Act, the committee will assist in the development of a Notice of Proposed Rulemaking that contains the proposed regulations needed to implement the TTSGP.
Nominations from tribes for membership on the negotiated rulemaking committee and comments
You may submit comments identified by the docket number FHWA-2016-0002 by any one of the following methods:
Send nominations to the Designated Federal Official, at the following address: Robert W. Sparrow, Director—Office of Tribal Transportation Program, Federal Highway Administration, Room E61-314, 1200 New Jersey Ave SE., Washington, DC 20590. Or email to:
In accordance with 5 U.S.C. 553(c), DOT solicits comments from the public to better inform its rulemaking process. The DOT posts these comments, without edit, including any personal information the comment provides, to
Robert W. Sparrow, Designated Federal Official, 1200 New Jersey Avenue SE., Washington, DC 20590. Telephone: (202) 366-9483 or at
Under the Negotiated Rulemaking Act, the purpose of the TTSGP Negotiated Rulemaking Committee will be to consider and discuss issues for the purpose of reaching a consensus in the development of a proposed rule for the TTSGP, as codified at 23 U.S.C. 207. The responsibilities/objectives of the committee are to represent the interests significantly affected by the proposed regulations, to negotiate in good faith, and to reach consensus, where possible, on a recommendation to the Secretary for the proposed regulations.
Section 1121 of the FAST Act directs the Secretary to carry out this work through negotiated rulemaking pursuant to subchapter III of chapter 5 of Title 5, United States Code. This subchapter requires an agency head to give consideration to seven factors when determining whether a negotiate rulemaking is appropriate. Upon reviewing the seven considerations set forth in the Negotiated Rulemaking Act and in accordance with Section 1121 of the FAST Act, the Secretary, through the authority delegated to the Administrator of the Federal Highway Administration, has determined that negotiated rulemaking is appropriate.
Section 1121 of the FAST Act requires the Secretary to:
• Establish a negotiated rulemaking committee to negotiate and develop regulations on the TTSGP;
• Reflect the unique government-to-government relationship between Indian tribes and the United States in accordance with Executive Order 13175 dated November 6, 2000, the Presidential Memorandum on Tribal Consultations issued on November 5, 2009, and U.S. Department of Transportation's Tribal Consultation Plan in establishing a negotiated rulemaking committee;
• Ensure that the membership of the committee includes only representatives of the Federal Government and of tribes that currently have funding agreements under Title 23;
• Select the tribal representatives for the committee from among individuals nominated by the tribes; and
• Ensure, to the maximum extent possible, a balance of representation with regard to geographical location, size, and existing transportation and self-governance experience in selecting tribal committee representatives.
The negotiated rulemaking process is fundamentally different from the usual process for proposed regulations. Most proposed regulations are drafted by a Federal agency and are then published for public comment. Affected parties may submit comments supporting their positions during the public comment period without communicating with other affected parties. Under the negotiated rulemaking process, a committee of representatives of the interests that will be significantly affected by the rulemaking negotiates the provisions of the proposed regulations with the agency. Negotiated rulemaking allows the Federal agency and the affected interests represented on the committee to discuss possible approaches to various issues and to negotiate the content of the regulations before proposed regulations are published. It also allows the affected parties to share information, knowledge, expertise, and technical abilities and to resolve their concerns about the regulations before publication.
One of the key principles of negotiated rulemaking is that agreement is by consensus of all of the interests and that no one interest or group controls or dominates the process. The Negotiated Rulemaking Act defines consensus as the unanimous concurrence among interests represented on a negotiated rulemaking committee, unless the committee agrees to define such term to mean a general but not unanimous concurrence or agrees upon another specified definition. The agency head, to the maximum extent possible consistent with the agency's legal obligations, uses the consensus of the committee as the basis for proposed regulations.
Experience of various Federal agencies in negotiated rulemaking has demonstrated that using a trained neutral person to facilitate the process assists all parties during negotiations to identify their real interest, evaluate their positions, communicate effectively, find common ground, and reach consensus where possible. The FHWA may use trained facilitators to assist with facilitating the first committee meeting. These facilitators may attend subsequent committee meetings and provide other services as required.
As required by the FAST Act, the TTSGP Negotiated Rulemaking Committee will be formed and will operate under the Negotiated Rulemaking Act.
The committee shall develop proposed regulations to carry out the TTSGP in accordance with 23 U.S.C. 207. The regulations will include details on eligibility criteria, the contents of program compacts and annual funding agreements including funding types, roles and responsibilities of tribes and the Federal Government, length terms, redesign and consolidation, retrocession, and termination. In addition, the committee will review and include cost principles, monitoring, waivers, and the applicability of the Indian Self-determination and Education Assistance Act.
The Committee is estimated to meet approximately 10 times. Due to limited availability of funding, FHWA reviewed various locations across the country in order to determine costs for the meetings. Accessibility, travel costs, per diem rates and the number of expected travelers were all considered. As a result of location (close proximity to three Bureau of Indian Affairs regions this reducing travel and overall per diem rates), it is expected that a majority of the meetings will be held in Albuquerque, New Mexico. However, other meetings may be held in locations across Indian Country as long as the overall meeting costs are equal to or less than Albuquerque and the location is approved by the committee. The meetings are expected to last 3 to 4 days each. Committee members will also be expected to participate in other regional tribal meetings to present status reports of the committee's activities. The Committee's work is expected to occur over the course of 10-12 months.
Committee members will not receive pay for their membership, but will be compensated for travel and
Because of the scope and complexity of the tasks at hand, committee members must be able to invest considerable time and effort in the negotiated rulemaking process. Committee members must be able to attend committee meetings, work on committee work groups, consult with their constituencies between committee meetings, and negotiate in good faith toward a consensus recommendation on issues before the committee. Because of the complexity of the issues under consideration, as well as the need for continuity, the FHWA reserves the right to replace any member who is unable to fully participate in the committee's meetings.
The FHWA is seeking nominations for tribal representatives to serve on the committee. Nominees should be elected officials of tribal governments (or their designated employees with authority to act on their behalf), acting in their official capacities individuals nominated by and identified as representatives of tribes and whose tribes have with existing Title 23 U.S.C. funding agreements with the Department. Nominees should have a demonstrated ability to communicate well with groups about the interests they will represent. Tribal committee membership must be tribal government representatives, a majority of whom shall be nominated by and be a representative of Indian tribes with existing funding agreements under this title.
The FAST Act requires FHWA to ensure that the various interests affected by the proposed regulations be represented on the negotiated rulemaking committee. In selecting members, FHWA shall consider whether the interest represented by a nominee will be affected significantly by the final products of the committee, whether that interest is already adequately represented by other tribal nominees, and whether the potential addition would adequately represent that interest.
If nominations received in response to this notice do not adequately meet the statutory requirements for tribal committee membership, or do not represent the interests that will be significantly affected by the regulations, FHWA may add representatives of its own choosing. The FHWA's decisions regarding the addition of representatives will be based on: Meeting the requirements of the Act; achieving a balanced committee; and assessing whether an interest will be affected significantly by the final rule, whether that interest is already adequately represented by tribal nominees, and whether the potential addition would adequately represent that interest.
The total committee membership is expected to be no more than 25 members in accordance with Section 565(b) of the Negotiated Rulemaking Act.
The FHWA Office of Federal Lands Highway will provide technical support for the committee. This office will arrange meeting sites and accommodations, arrange travel for tribal committee members, ensure adequate logistical support (equipment, personnel, etc.) at committee meetings, provide committee members with all relevant information, distribute written materials, ensure timely reimbursement of authorized expenses for committee members, maintain records of the committee's work, and support the committee as otherwise required.
At the first meeting of the TTSGP Negotiated Rulemaking Committee, a neutral facilitator will provide training on negotiated rulemaking, interest-based negotiations, consensus-building, and team-building. In addition, at the first meeting, committee members will make organizational decisions concerning protocols, scheduling, and facilitation of the committee. All committee members must attend the first meeting. Attendance at all subsequent meetings is mandatory as well unless a written excused absence is obtained from the Designated Federal Official.
A key principle of negotiated rulemaking is that agreement is by consensus of all of the significantly affected interests. Section 562 of the Negotiated Rulemaking Act defines the term “interest” as “with respect to an issue or matter, multiple parties which have a similar point of view or which are likely to be affected in a similar manner.” In making the selection of the committee members, all effort will be made so as to result in a geographically diverse committee. In addition, the magnitude of program size as well as experience in transportation and self-governance will be considered in the committee selections so as to identify and include all significantly affected interests.
There may be other interests not yet identified that will be significantly affected by the regulations. The Department is accepting comments until the date listed in the
Under the requirements stated in the Background section, the Secretary invites tribes to nominate tribal primary representatives to serve on the committee and tribal alternates to serve when the representative is unavailable. It is expected that the committee will be composed of one tribal representative from each of the 12 BIA Regions, along with a lesser number of Federal representatives. Additional tribal representatives will be considered if the Secretary believes that it would result in better serving tribal interests. Although each federally recognized tribe that has a funding agreement under Title 23 may nominate a representative and alternate for the committee, it is strongly encouraged that all nominating tribes within a BIA Region agree to nominate and thus support one primary representative and one alternate for that Region. Because committee membership should reflect the diversity of tribal interests, tribes should nominate representatives and alternates who will:
• Have knowledge of existing self-governance regulations, policies, and procedures;
• Be able to represent the tribe(s) with the authority to embody tribal views, communicate with tribal constituents, and have a clear means to reach agreement on behalf of the tribe(s);
• Be able to negotiate effectively on behalf of the tribe(s) represented;
• Be able to commit the time and effort required to attend and prepare for meetings; and
• Be able to collaborate among diverse parties in a consensus-seeking process.
In order to achieve as much tribal diversity and representation as possible, the Secretary also invites nominations from intertribal consortia and tribal organizations as well. Nominees of these interests, like the proportionate-share nominees, must meet the criteria of this section.
If anyone believes their interests will not be adequately represented by the interests noted above, they must demonstrate and document that assertion through an application. The FHWA requests comments and suggestions regarding its tentative identification of affected interests.
The FHWA will consider only nominations for tribal committee representatives nominated through the process identified in this
Nominations must include the following information about each tribal committee member nominee:
(1) The nominee's name, tribal affiliation, job title, major job duties, and employer business address, telephone number, and email address;
(2) The tribal interest(s) to be represented by the nominee (see section V of this notice) and whether the nominee will represent other interest(s) related to this rulemaking, as the tribe may designate;
(3) A resume reflecting the nominee's qualifications and experience in transportation, the negotiated rulemaking process, and existing self-governance regulations; and
(4) A brief description of how they will represent tribal views, communicate with tribal constituents, and have a clear means to reach agreement on behalf of the tribe(s) they are representing. Additionally, a statement whether the nominee is only representing one tribe's views or whether the expectation is that the nominee represents a group of tribes.
To be considered, nominations must be received by the close of business on the date listed in the
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice of applications for exemptions; request for comments.
FMCSA announces receipt of applications from 68 individuals for exemption from the prohibition against persons with insulin-treated diabetes mellitus (ITDM) operating commercial motor vehicles (CMVs) in interstate commerce. If granted, the exemptions would enable these individuals with ITDM to operate CMVs in interstate commerce.
Comments must be received on or before May 25, 2016.
You may submit comments bearing the Federal Docket Management System (FDMS) Docket No. FMCSA-2016-0036 using any of the following methods:
•
•
•
•
Christine A. Hydock, Chief, Medical Programs Division, (202) 366-4001,
Under 49 U.S.C. 31136(e) and 31315, FMCSA may grant an exemption from the Federal Motor Carrier Safety Regulations for a 2-year period if it finds “such exemption would likely achieve a level of safety that is equivalent to or greater than the level that would be achieved absent such exemption.” The statute also allows the Agency to renew exemptions at the end of the 2-year period. The 68 individuals listed in this notice have recently requested such an exemption from the diabetes prohibition in 49 CFR 391.41(b)(3), which applies to drivers of CMVs in interstate commerce. Accordingly, the Agency will evaluate the qualifications of each applicant to determine whether granting the exemption will achieve the required level of safety mandated by statute.
Mr. Adams, 41, has had ITDM since 2009. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Adams understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Adams meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Bates, 46, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Bates understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Bates meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Texas.
Mr. Bates, 28, has had ITDM since 1989. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Bates understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Bates meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds an operator's license from Vermont.
Mr. Baumgart, 33, has had ITDM since 1984. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Baumgart understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Baumgart meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class A CDL from Nebraska.
Mr. Birch, 52, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Birch understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Birch meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Borchers, 43, has had ITDM since 2013. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Borchers understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Borchers meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from New Jersey.
Mr. Boucher, 43, has had ITDM since 2014. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Boucher understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Boucher meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he has stable nonproliferative diabetic retinopathy. He holds an operator's license from Maine.
Mr. Broussard, 31, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Broussard understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Broussard meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Kansas.
Mr. Brown, 46, has had ITDM since 2011. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Brown understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Brown meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Virginia.
Mr. Catizone, 24, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Catizone understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Catizone meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from Massachusetts.
Mr. Christians, 54, has had ITDM since 2014. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Christians understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Christians meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Minnesota.
Mr. Cook, 32, has had ITDM since 1992. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Cook understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Cook meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from Pennsylvania.
Mr. Davis, 57, has had ITDM since 2012. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Davis understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Davis meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Missouri.
Mr. Dickerson, 58, has had ITDM since 2012. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Dickerson understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Dickerson meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class B CDL from Arkansas.
Mr. Duncan, 57, has had ITDM since 2014. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Duncan understands diabetes management and monitoring, has stable control of his diabetes using
Mr. Faller, 53, has had ITDM since 2012. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Faller understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Faller meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Fehr, 62, has had ITDM since 1978. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Fehr understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Fehr meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class A CDL from Illinois.
Mr. Feller, 59, has had ITDM since 2008. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Feller understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Feller meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Indiana.
Mr. Glenning, 42, has had ITDM since 2014. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Glenning understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Glenning meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Florida.
Mr. Green, 46, has had ITDM since 2010. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Green understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Green meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class A CDL from Tennessee.
Mr. Grover, 35, has had ITDM since 2008. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Grover understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Grover meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Idaho.
Mr. Guccion, 32, has had ITDM since 2003. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Guccion understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Guccion meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Iowa.
Mr. Guzman, 24, has had ITDM since 1992. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Guzman understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Guzman meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds an operator's license from Florida.
Mr. Harnden, 52, has had ITDM since 2013. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the
Mr. Hartley, 56, has had ITDM since 2010. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Hartley understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Hartley meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class A CDL from Kansas.
Mr. Heisler, 41, has had ITDM since 2006. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Heisler understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Heisler meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from Pennsylvania.
Mr. Hernandez, 26, has had ITDM since 1998. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Hernandez understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Hernandez meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he has stable nonproliferative diabetic retinopathy. He holds an operator's license from Mississippi.
Mr. Hill, 65, has had ITDM since 2011. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Hill understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Hill meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Washington.
Mr. Hulst, 35, has had ITDM since 2014. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Hulst understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Hulst meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from South Dakota.
Mr. Hyde, 67, has had ITDM since 2010. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Hyde understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Hyde meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Massachusetts.
Mr. Jackson, 55, has had ITDM since 2011. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Jackson understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Jackson meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Indiana.
Ms. Jenkins, 50, has had ITDM since 2015. Her endocrinologist examined her in 2015 and certified that she has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. Her endocrinologist certifies that Ms. Jenkins understands diabetes management and monitoring has stable control of her diabetes using insulin, and is able to drive a CMV safely. Ms. Jenkins meets the requirements of the vision standard at 49 CFR 391.41(b)(10). Her optometrist examined her in 2016 and certified that she does not have
Mr. Jones, 59, has had ITDM since 2014. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Jones understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Jones meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Virginia.
Mr. Joyce, 31, has had ITDM since 1997. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Joyce understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Joyce meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds an operator's license from Maryland.
Mr. Joyce, 43, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Joyce understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Joyce meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Massachusetts.
Mr. Keech, 44, has had ITDM since 1999. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Keech understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Keech meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Kerby, 60, has had ITDM since 2013. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Kerby understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Kerby meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Maryland.
Mr. Kreier, 69, has had ITDM since 2000. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Kreier understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Kreier meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he has stable nonproliferative diabetic retinopathy. He holds a Class A CDL from Wisconsin.
Mr. Kurtz, 60, has had ITDM since 2012. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Kurtz understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Kurtz meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class C CDL from Pennsylvania.
Mr. Ludwig, 34, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Ludwig understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Ludwig meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from North Dakota.
Mr. Mitchell, 57, has had ITDM since 2012. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Mitchell understands diabetes management and monitoring,
Mr. Moore, 67, has had ITDM since 1990. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Moore understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Moore meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from West Virginia.
Mr. Neidermeier, 22, has had ITDM since 1999. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Neidermeier understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Neidermeier meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from Florida.
Mr. Noon, 76, has had ITDM since 2014. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Noon understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Noon meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Michigan.
Mr. Ortiz, 52, has had ITDM since 2015. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Ortiz understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Ortiz meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from California.
Mr. Palmer, 24, has had ITDM since 1995. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Palmer understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Palmer meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from New York.
Mr. Pegues, 44, has had ITDM since 1976. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Pegues understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Pegues meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from Illinois.
Mr. Penrod, 64, has had ITDM since 2013. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Penrod understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Penrod meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from South Dakota.
Mr. Peppers, 50, has had ITDM since 2009. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Peppers understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Peppers meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from California.
Mr. Peterson, 34, has had ITDM since 2013. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting
Mr. Peterson, 59, has had ITDM since 2016. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Peterson understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Peterson meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Nebraska.
Mr. Potter, 45, has had ITDM since 2015. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Potter understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Potter meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Missouri.
Ms. Reynolds, 37, has had ITDM since 2014. Her endocrinologist examined her in 2016 and certified that she has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. Her endocrinologist certifies that Ms. Reynolds understands diabetes management and monitoring has stable control of her diabetes using insulin, and is able to drive a CMV safely. Ms. Reynolds meets the requirements of the vision standard at 49 CFR 391.41(b)(10). Her optometrist examined her in 2016 and certified that she does not have diabetic retinopathy. She holds an operator's license from Colorado.
Ms. Sanchez, 53, has had ITDM since 2012. Her endocrinologist examined her in 2016 and certified that she has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. Her endocrinologist certifies that Ms. Sanchez understands diabetes management and monitoring has stable control of her diabetes using insulin, and is able to drive a CMV safely. Ms. Sanchez meets the requirements of the vision standard at 49 CFR 391.41(b)(10). Her ophthalmologist examined her in 2015 and certified that she has stable proliferative diabetic retinopathy. She holds a Class B CDL from New York.
Mr. Sexton, 57, has had ITDM since 2013. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Sexton understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Sexton meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds an operator's license from Maine.
Mr. Sing, 47, has had ITDM since 2014. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Sing understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Sing meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Ohio.
Mr. Smith, 55, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Smith understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Smith meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
Mr. Sorrells, 47, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Sorrells understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Sorrells meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have
Mr. Tavares, 26, has had ITDM since 2002. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Tavares understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Tavares meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds an operator's license from Rhode Island.
Mr. Thomen, 52, has had ITDM since 2013. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Thomen understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Thomen meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Ohio.
Mr. Tibbetts, 66, has had ITDM since 2015. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Tibbetts understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Tibbetts meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class B CDL from Maine.
Mr. Tillman, 39, has had ITDM since 2015. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Tillman understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Tillman meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Florida.
Mr. Trout, 60, has had ITDM since 2015. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Trout understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Trout meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Washington.
Mr. Trudeau, 27, has had ITDM since 2015. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Trudeau understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Trudeau meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His ophthalmologist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from Montana.
Mr. Waldron, 59, has had ITDM since 2008. His endocrinologist examined him in 2016 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Waldron understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Waldron meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Massachusetts.
Mr. Wilfeard, 26, has had ITDM since 2010. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Wilfeard understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Wilfeard meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2016 and certified that he does not have diabetic retinopathy. He holds an operator's license from New York.
Ms. Williams, 66, has had ITDM since 2012. Her endocrinologist examined her in 2016 and certified that she has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. Her endocrinologist certifies that Ms. Williams understands diabetes management and monitoring has stable
Mr. Wolf, 71, has had ITDM since 2014. His endocrinologist examined him in 2015 and certified that he has had no severe hypoglycemic reactions resulting in loss of consciousness, requiring the assistance of another person, or resulting in impaired cognitive function that occurred without warning in the past 12 months and no recurrent (2 or more) severe hypoglycemic episodes in the last 5 years. His endocrinologist certifies that Mr. Wolf understands diabetes management and monitoring, has stable control of his diabetes using insulin, and is able to drive a CMV safely. Mr. Wolf meets the requirements of the vision standard at 49 CFR 391.41(b)(10). His optometrist examined him in 2015 and certified that he does not have diabetic retinopathy. He holds a Class A CDL from Pennsylvania.
In accordance with 49 U.S.C. 31136(e) and 31315, FMCSA requests public comment from all interested persons on the exemption petitions described in this notice. We will consider all comments received before the close of business on the closing date indicated in the date section of the notice.
FMCSA notes that section 4129 of the Safe, Accountable, Flexible and Efficient Transportation Equity Act: A Legacy for Users requires the Secretary to revise its diabetes exemption program established on September 3, 2003 (68 FR 52441).
Section 4129 requires: (1) Elimination of the requirement for 3 years of experience operating CMVs while being treated with insulin; and (2) establishment of a specified minimum period of insulin use to demonstrate stable control of diabetes before being allowed to operate a CMV.
In response to section 4129, FMCSA made immediate revisions to the diabetes exemption program established by the September 3, 2003 notice. FMCSA discontinued use of the 3-year driving experience and fulfilled the requirements of section 4129 while continuing to ensure that operation of CMVs by drivers with ITDM will achieve the requisite level of safety required of all exemptions granted under 49 U.S.C. 31136(e).
Section 4129(d) also directed FMCSA to ensure that drivers of CMVs with ITDM are not held to a higher standard than other drivers, with the exception of limited operating, monitoring and medical requirements that are deemed medically necessary.
The FMCSA concluded that all of the operating, monitoring and medical requirements set out in the September 3, 2003 notice, except as modified, were in compliance with section 4129(d). Therefore, all of the requirements set out in the September 3, 2003 notice, except as modified by the notice in the
You may submit your comments and material online or by fax, mail, or hand delivery, but please use only one of these means. FMCSA recommends that you include your name and a mailing address, an email address, or a phone number in the body of your document so that FMCSA can contact you if there are questions regarding your submission.
To submit your comment online, go to
We will consider all comments and material received during the comment period. FMCSA may issue a final determination at any time after the close of the comment period.
To view comments, as well as any documents mentioned in this preamble, go to
Federal Motor Carrier Safety Administration (FMCSA), DOT.
Notice of denials.
FMCSA announces its denial of 137 applications from individuals who requested an exemption from the Federal vision standard applicable to interstate truck and bus drivers and the reasons for the denials. FMCSA has statutory authority to exempt individuals from the vision requirement if the exemptions granted will not compromise safety. The Agency has concluded that granting these exemptions does not provide a level of safety that will be equivalent to, or greater than, the level of safety maintained without the exemptions for these commercial motor vehicle (CMV) drivers.
Christine A. Hydock, Chief, Medical Programs Division, (202) 366-4001,
Under 49 U.S.C. 31136(e) and 31315, FMCSA may grant an exemption from the Federal vision standard for a renewable 2-year period if it finds “such an exemption would likely achieve a level of safety that is equivalent to or greater than the level that would be achieved absent such an exemption.” The procedures for requesting an exemption are set forth in 49 CFR part 381.
Accordingly, FMCSA evaluated 137 individual exemption requests on their
The following 4 applicants did not have sufficient driving experience over the past 3 years under normal highway operating conditions: Bradlee J. Durham, Nolan B. Dykema, Jerry M. Elsberry, Jr., James A. Pugh.
The following 23 applicants had no experience operating a CMV: Jeret D. Akers, Jose G. Alvarez, Cristian D. Berlingeri, Larry G. Buchanan, Enedino A. Burgos, Michael E. Carter, Shernard Cook, Benjamin J. Curtis, Larry L. Davis, Jr., Jesse J. DeRico, Brent I. Gruszka, Andrei I. Gusakov, Damian Klyza, Miriam Laing, Patrick N. Lancaster, Daniel F. Large, Curtis G. Myrah, Omar Orozco, Moises A. Portillo, Samuel C. Rodriguez, Mark J. Smithson, William B. Stiles, Sr., Michael H. Taylor.
The following 22 applicants did not have 3 years of experience driving a CMV on public highways with their vision deficiencies: Osman M. Adanalic, Christopher L. Bolding, William H. Conley, Fernando Cuevas, Fred L. Curtis, Kurt D. Davis, Adriano De Vargas, Alex J. Demaree, Dennis C. Durstine, Howard G. Edgar, Hamid Ferdowsi, Eric S. Hill, Wayde J. Isbell, Lloyd H. Kiihn, Earl B. Moffatt, Bryan S. Moses, Ronald R. Regier, John A. Ruggiero, Timothy P. Ryan, Charles E. Schrecengost, Barney R. Stephens, Larry L. Stewart.
The following 16 applicants did not have 3 years of recent experience driving a CMV with the vision deficiency: John F. Armstrong, Gerald L. Barber, Daniel J. Council, Helmut Danecker, Anthony R. Dirjan, David N. Groves, Antonio A. Jackson, Herman R. Lee, Jr., Robert C. Mason, Wayne C. Merry, Sherard L. Orange, Daniel D. Sandoval, Edward V. Skowronski, Colby T. Smith, Kenneth L. Sutphin, Bryan H. Walker.
The following 12 applicants did not have sufficient driving experience during the past 3 years under normal highway operating conditions: Joshua L. Arnold, Kevin D. Duffy, Thomas M. Hallwig, Gabriel L. Harrison, Richard K. Hemmingsen, Gerardo Hernandez, Raul T. Leiva, Nathan M. Magaard, Mark Paugh, Gregory M. Quilling, Chad M. Smith, Jeffrey L. Tanner.
The following 2 applicants had their commercial driver's licenses suspended during the previous 3-year period: Michael J. Achille, Tydrick D. Brooks.
The following 3 applicants contributed to an accident(s) while operating a CMV: Thomas R. Abbott, Timothy L. Bauman, Randy J. Miller.
The following applicant, Thomas D. Jacobsen, did not hold a license which allowed operation of vehicles over 26,000 lbs. for all or part of the previous 3-year period.
The following applicant, Toby L. Simmons, did not have an optometrist or ophthalmologist willing to make a statement that they are able to operate a commercial vehicle from a vision standpoint.
The following 9 applicants were denied for multiple reasons: Joseph D. Allen, Dennis M. Coley, Timothy W. Detweiler, Hector O. Flores, Jonathan M. Gilligan, David P. Mello, Edward R. Slater, Hawthorne B. Smith, Thomas D. Walsh.
The following applicant, Christopher D. Boyd, did not have stable vision for the entire 3-year period.
The following 13 applicants met the current federal vision standards. Exemptions are not required for applicants who meet the current regulations for vision: Hani Abiyounes, Kendall K. Chandler, Chad A. Curtis, Shorty Ellis, Karl D. Graves, Carl Groves, Alexander J. Hartelust, Lark M. Hartsock, James E. Jordon, Dorvin R. Neuberger, Peter J. Niedzwiecki, Raimer A. Paredes-Escano, Timothy T. Tyree.
The following 3 applicants drove interstate while restricted to intrastate: Adrienne J. Allen, James L. Jones, Troy A. Stephens.
The following 19 applicants will not be driving interstate, interstate commerce, or are not required to carry a DOT medical card: Gary W. Brockway, Fredrick Brown, Richard C. Brust, Joseph L. Cohea, Robert L. Damron, James E. Donaldson, Richard Duran, Freddie M. Henderson, Brian D. Hoover, Ron E. Hullett, Walter J. Jurczak, Keith Kebschull, Charles J. Kruggel, Lois J. Mahar, Dustin M. Mills, Wilbur Robinson, Jr., Robert G. Schoenborn, Phillip J. Will, James L. Yingst.
Finally, the following 8 applicants perform transportation for the federal government, state, or any political sub-division of the state. Randy L. Coney, Rodriquez D. Evans, Jose A. Flores, Ira D. Manuelito, Steven C. Myers, Leif H. Stensrud, Joshua E. Weicht, Aaron E. Zelmer.
In accordance with part 211 of Title 49 Code of Federal Regulations (CFR), this document provides the public notice that by a document dated February 11, 2016, Norfolk Southern Railway (NS) requested that the Federal Railroad Administration (FRA) Railroad Safety Board (Board) approve an amendment to its existing waiver in order to expand the territory inspected pursuant to its nonstop continuous rail testing process. The projected starting date for implementing the expansion would be March 1, 2016, and the testing process would continue up to July 1, 2018.
The original waiver grants relief from 49 CFR 213.113(a) and allows NS to perform a continuous rail test process on certain designated tracks in lieu of the stop/start rail testing required by the regulation. NS is currently using nonstop continuous testing on the main tracks of the Dearborn Division, Chicago Line (Cleveland, OH, to Chicago, IL, Milepost (MP) CD 181.2-523.3)). Once this district has been completed, NS would expand the continuous testing process to the following locations: (1) Dearborn Division Cleveland Line (Ravenna to Drawbridge, MP RD 85.9-123.2), Chicago District (Chicago, IL, to Hobart, IN, MP B 518.7-486.5), Lake Erie District (Euclid to Bay Village, B 172.0-197.3); (2) Lake Division Chicago, Fostoria, and Cleveland Districts (Hobart, IN, to Bay Village, OH, MPB 486.5-197.3); (3) Pittsburgh Division, Fort Wayne Line (Pittsburgh, PA, to Crestline, OH, MP PC 0.0-188.7), Pittsburgh Line (Pittsburgh, PA, to CP Cannon MP, PT 353.5-119.1), Conemaugh Line (CP Conpit to CP Penn MP LC 0.0-77.9), Lake Erie District (Euclid to Ashtabula, B 172.0-129.2), Cleveland Line (Ravenna to Alliance, MP RD 85.9-67.2); and (4) Harrisburg Division, Pittsburgh Line (Harris to CP Cannon, MP PT 104.9-119.1), Harrisburg Line (Falls to Harrisburg, PA, MP HP 5.2-112.9), Port Road Branch (Port to Banks, MP EP 33.7-76.1 and Perryville to Port, MP PD 0.3-39.7).
The expanded inspection territories include: Central Division, Cincinnati,
The nonstop continuous rail test vehicle is a self-propelled ultrasonic/induction rail flaw detection vehicle operating at test speeds up to 30 mph. Upon completion of each daily run, data is analyzed offline by technical experts experienced with the process on other Class I railroads. The analysis categorizes and prioritizes suspect locations for post-test field verification and hand tests. Field verification is conducted by qualified and certified rail test professionals with recordable field validation equipment based on GPS location and known track features identified within the flaw detection electronic record. Remedial actions are applied based on the findings per 49 CFR 213.113 for confirmed rail defect locations.
NS' Engineering Department will continue to provide FRA's Rail Integrity office with rail test reports for review as required. NS believes expansion of the nonstop continuous rail testing to additional territory will continue to provide the capability to test track more quickly and frequently, and minimize the risk of rail service failures.
A copy of the petition, as well as any written communications concerning the petition, is available for review online at
Interested parties are invited to participate in these proceedings by submitting written views, data, or comments. FRA does not anticipate scheduling a public hearing in connection with these proceedings since the facts do not appear to warrant a hearing. If any interested party desires an opportunity for oral comment, they should notify FRA, in writing, before the end of the comment period and specify the basis for their request.
All communications concerning these proceedings should identify the appropriate docket number (
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Communications received by June 9, 2016 will be considered by FRA before final action is taken. Comments received after that date will be considered as far as practicable.
Anyone is able to search the electronic form of any written communications and comments received into any of our dockets by the name of the individual submitting the comment (or signing the document, if submitted on behalf of an association, business, labor union, etc.). In accordance with 5 U.S.C. 553(c), DOT solicits comments from the public to better inform its processes. DOT posts these comments, without edit, including any personal information the commenter provides, to
In accordance with part 211 of Title 49 Code of Federal Regulations (CFR), this document provides the public notice that by a document dated February 24, 2016, San Diego Trolley Incorporated (SDTI) petitioned the Federal Railroad Administration (FRA) for a supplemental waiver of compliance from certain additional provisions of the Federal railroad safety regulations contained in various parts of Title 49 of the CFR. FRA assigned the petition to Docket Number FRA-2000-7137.
SDTI seeks a 5-year extension of its existing waiver, as well as a waiver of additional regulations, for certain portions of its light rail transit operations which employ temporal separation in order to safely share track with the general railroad system's San Diego and Imperial Valley Railroad. Contiguous to the shared trackage are portions with limited connections, which include a small shared corridor with BNSF Railway freight service and Coaster commuter train service (Coaster also shares a storage yard with SDTI). FRA granted SDTI its initial waiver on January 19, 2001, which was extended for 5 years on September 11, 2006, to include minor operational changes. The waiver was most recently extended for 5 years on June 22, 2011, to include updating CFR section changes made since 2006. In 2012, SDTI received a separate waiver from FRA to operate its SD100 and S70 rolling stock at speeds that generate cant deficiency not exceeding 6 inches on its Orange Line joint use trackage (see Docket Number FRA-2012-0088). To simplify matters, SDTI now requests that the relief in both dockets be baselined into Docket Number FRA-2000-7137.
After consulting with FRA during an onsite meeting on March 24, 2016, SDTI is requesting additional relief from the following regulatory sections: 49 CFR part 214, subpart C, Roadway Worker Protection; part 228, subpart F, Substantive Hours of Service Requirements for Train Employees Engaged in Commuter or Intercity Rail Passenger Transportation; and part 242, Qualification and Certification of Conductors.
A copy of the petition, as well as any written communications concerning the petition, is available for review online at
Interested parties are invited to participate in these proceedings by submitting written views, data, or comments. FRA does not anticipate scheduling a public hearing in connection with these proceedings since the facts do not appear to warrant a hearing. If any interested party desires an opportunity for oral comment, they should notify FRA, in writing, before the end of the comment period and specify the basis for their request.
All communications concerning these proceedings should identify the appropriate docket number and may be
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Communications received by June 9, 2016 will be considered by FRA before final action is taken. Comments received after that date will be considered as far as practicable.
Anyone is able to search the electronic form of any written communications and comments received into any of our dockets by the name of the individual submitting the comment (or signing the document, if submitted on behalf of an association, business, labor union, etc.). In accordance with 5 U.S.C. 553(c), DOT solicits comments from the public to better inform its processes. DOT posts these comments, without edit, including any personal information the commenter provides, to
Maritime Administration, Department of Transportation.
Notice of funding opportunity.
The Consolidated Appropriations Act of 2016 (Pub. L. 114-113), signed by the President on December 18, 2015, appropriated $5,000,000 for the Short Sea Transportation Program (America's Marine Highways). The purpose of the appropriation is to make grants for projects related to documented vessels and port and landside infrastructure. This notice announces the availability of funding for Marine Highway grants and establishes selection criteria and application requirements.
The Department of Transportation (Department) will award Marine Highway Grants to implement projects or components of projects designated under America's Marine Highway Program. Eligible applicants must be sponsors of Marine Highway Projects formally designated by the Secretary of Transportation (Secretary). The current list of designated Marine Highway Projects, and sponsors thereof, can be found on the Marine Highway Web site at:
MARAD invites applications for projects that have the added benefit of mitigating the negative impact of freight movement on communities. Projects should also provide additional public benefit by addressing access to training and job opportunities, where applicable and appropriate.
Applications must be received by 8:00 p.m. Eastern Daylight Time (EDT) on Friday, May 27, 2016. Applications received later than this time will not be considered.
Grant applications must be submitted electronically using
Applicants are strongly encouraged to make submissions in advance of the deadline. Applications received after the deadline will not be considered except in the case of unforeseen technical difficulties as outlined below. Late applications that are the result of failure to register or comply with Grants.gov applicant requirements in a timely manner will not be considered. Applicants experiencing technical issues with Grants.gov that are beyond the applicant's control must contact
For further information concerning this notice, please contact Tori Collins, Office of Marine Highways and Passenger Service, Room W21-315, Maritime Administration, 1200 New Jersey Ave. SE., Washington, DC 20590. Phone (202) 366-0795 or email
Section 55601 of Title 46 of the United States Code directs the Secretary to establish a short sea transportation grant program to implement projects or components of designated projects. The grant funds currently available are for projects related to documented vessels, and port and landside infrastructure.
Under the Marine Highways Grant Program there is currently $5,000,000 available for designated Marine Highway Projects. Only projects proposed by a project sponsor that have been formally designated by the Secretary under the America's Marine Highway Program are eligible. The Secretary, through the Maritime Administration (MARAD), intends to award the available funding through grants to the extent that there are worthy applications. MARAD will seek to obtain the maximum benefit from the available funding by awarding grants to as many of the most worthy projects as possible. However, MARAD reserves the right to award all funds to just one project. MARAD may partially fund applications by selecting parts of various discrete projects. The start date and period of performance for each award will depend on the specific project and must be agreed to by MARAD.
Applicants eligible for Marine Highway Grants are sponsors of projects that the Secretary has designated as a specific Marine Highway Project under the America's Marine Highway Program. Project sponsors are public entities including metropolitan planning organizations (MPOs), State governments (including State Departments of Transportation), port authorities and tribal governments. Project sponsors are encouraged to develop coalitions and public/private partnerships, which include vessel owners and operators; third-party logistics providers; trucking companies; shippers; railroads; port authorities; State, regional and local transportation planners; environmental interests; impacted communities; or any combination of entities working in collaboration under a single application.
An applicant must provide at least 20 percent of project costs from non-Federal sources. In awarding grants under the program, MARAD will give preference to those projects or components that present the most financially viable transportation services and require the lowest total percentage of the Federal share of the costs.
The intent of this grant program is to expand the use of water transportation using designated projects to create new or expanded services along designated Marine Highway Routes. Components of projects that are eligible for this round of grant funding include the following:
Applications must be filed on Application for Federal Assistance, SF-424, which is available on the Grants.gov Web site.
Grant applications should be submitted using Grants.gov. The application should include all of the information requested below. MARAD reserves the right to ask any applicant for supplemental data, but expects applications to be complete upon submission. To the extent practical, MARAD encourages applicants to provide data and evidence of project merits in a form that is verifiable.
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(i.) Marine Highway Project name (as stated in the Department's Letter of Designation);
(ii.) Primary point of contact for applicant;
(iii.) Total amount of the project cost in dollars and the amount of grant funds the applicant is seeking, along with sources, and share of other matching funds;
(iv.) Summary statement of how the grant funding will be applied;
(v.) Project parties; and
(vi.) Unique entity identifier number. Recipients of Marine Highway grants and their first-tier sub-awardees must have Unique Entity Identifier numbers (
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(i.) That, except as noted in this grant application, nothing has changed from the original application for formal designation as a Marine Highway Project;
(ii.) The project sponsor will administer the project and any funds received will be spent efficiently and effectively; and
(iii.) Applicant will provide information, data, and reports as required.
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MARAD will not make an award to an applicant until the applicant has complied with all applicable unique entity identifier and SAM requirements, if applicable. Each applicant must be registered in SAM before submitting an application, and maintain an active SAM registration with current information throughout the period of the award. Applicants may register with the SAM at
Applications must be received by 8:00 p.m. EDT on Friday, May 27, 2016. Applications received later than this time will not be considered.
While Marine Highway Grant funds may be used for demonstration projects, they will not be used as an operating subsidy.
MARAD will consider the following criteria in the evaluation process: (1) Reduction of external cost and public benefit; (2) whether the project offers a lower-cost alternative to increasing land-based capacity; and (3) demonstration of the likelihood of financial viability. Applicants will have provided this information during the project designation process. As certain elements of the original project application may have changed, applicants must provide more detailed information regarding market information and cost modeling with the grant application.
Applicants may opt to provide additional information specific to the above criteria if they desire. While not mandatory, this additional information will help ensure that MARAD has as much information as possible to evaluate the applications against the selection criteria identified below. In deciding whether to do so, applicants should consider the application requirements set out at 46 U.S.C. 55601(g)(2)(B) that state in order to receive a grant under the program, the applicants must demonstrate that: (A) The project is financially viable; (B) the funds received will be spent efficiently and effectively; and, (C) a market exists for the services of the proposed project as evidenced by contracts or written statements of intent from potential customers.
Upon receipt, MARAD will evaluate the application using the criteria outlined above during a technical review and environmental analysis. The review will assess project scope, impact, public-benefit, environmental effects, offsetting costs, cost to the Government (if any), the likelihood of long-term self-supporting operations, market/customer commitment, operational costs, and its relationship with designated Marine Highway Routes.
Upon completion of the technical review, MARAD will forward the applications to a Department inter-agency review team (Intermodal Team). The Office of the Secretary of Transportation will lead the evaluation team and will include members of MARAD, other Department Operating Administrations, and as appropriate, representation from other Federal agencies and other representatives, as needed. The Intermodal Team will evaluate applications using criteria that establish the degree to which a proposed project can: Reduce external cost and provide public benefit, offer a lower-cost alternative to increasing capacity on the Route, and demonstrate the likelihood the service associated with the project will become self-supporting in a specified and reasonable timeframe. The Intermodal Team will assign ratings of “highly recommended,” “recommended” or “not recommended” for each application based on the criteria set forth above. The Intermodal Team will provide recommendations to the Maritime Administrator and subsequently to the Secretary.
Following the evaluation outlined in Section E, MARAD will announce grant awards by posting a list of selected projects on the MARAD Web site at
All awards must be administered pursuant to the Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards found in 2 CFR part 200, as adopted by the Department at 2 CFR part 1201. Additionally, all applicable Federal laws and regulations will apply to projects that receive Marine Highway grants. The period of time following award that a project is expected to expend grant funds and start construction, acquisition, or procurement will be considered on a case-by-case basis and will be specified in the project-specific grant agreement. MARAD reserves the right to revoke any award of Marine Highway grant funds and to award such funds to another project to the extent that such funds are not expended in a timely or acceptable manner and in accordance with the project schedule. Federal wage rate requirements included at 40 U.S.C. Sections 3141 to 3148 apply to all projects receiving funds under this program, and apply to all parts of the project, whether funded with other Federal funds or non-Federal funds.
Grantees must submit quarterly reports to the Office of Marine Highways to keep MARAD informed of all activities during the reporting period. The reports will indicate progress made, planned activities for the next period, and a listing of any supplies and/or equipment purchased with grant funds during the reporting period. In addition, the report will include an explanation of any deviation from the projected budget and timeline. Quarterly status reports will also contain, at a minimum, the following: (1) A statement as to whether Grantee has used the Grant Funds consistent with the terms contemplated in the Grant Agreement; (2) if applicable, a description of the budgeted activities not procured by Grantee; (3) if applicable, the rationale for Grantee's failure to execute the budgeted activities; (4) if applicable, explanation as to how and when Grantee intends to accomplish the purposes of the Grant Agreement; and (5) a budget summary showing funds expended since commencement, anticipated expenditures for the next reporting period, and expenditures compared to overall budget.
Consistent with the requirements of Section 410 of Division L—Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2016, of the Consolidated Appropriations Act of 2016 (Pub. L. 114-113), the Buy American requirements of 41 U.S.C. 8303 apply to funds made available under this Notice of Funding Opportunity.
For further information concerning this notice please contact Tori Collins, Office of Marine Highways and Passenger Services, Maritime Administration, Room W21- 315, 1200 New Jersey Ave. SE., Washington, DC 20590. Phone (202) 366-0951 or fax: (202) 366-6988.
To ensure applicants receive accurate information about eligibility or the program, or in response to other questions, you are encouraged to contact MARAD directly, rather than through intermediaries or third parties.
By Order of the Maritime Administrator.
United States Institute of Peace.
Monday, April 25, 2016 (10:00 a.m.-2:00 p.m.)
2301 Constitution Avenue NW., Washington, DC 20037.
Open Session—Portions may be closed pursuant to Subsection (c) of Section 552(b) of Title 5, United States Code, as provided in subsection 1706(h)(3) of the United States Institute of Peace Act, Public Law 98-525.
April 25, 2016 Board Meeting; Approval of Minutes of the One Hundred Fifty-seventh Meeting (October 23, 2015) of the Board of Directors; Chairman's Report; Vice Chairman's Report; President's Report; Reports from USIP Board Committees; USIP Myanmar Team Presentation; USIP Preventing Electoral Violence Presentation.
Nick Rogacki, Special Assistant to the President, Email:
Notice of meeting.
In accordance with the Federal Advisory Committee Act, 5 U.S.C., App. 2, the Commission on Care gives notice that it will meet on Monday, May 9, 2016, Tuesday, May 10, 2016, and Wednesday, May 11, 2016, at the J.W. Marriott, Jr. ASAE Conference Center, 1575 I St. NW., Washington, DC 20005. The meeting will convene at 8:30 a.m. and end by 6:00 p.m. (EDT) on May 9 and 10. The meeting will convene at 8:30 a.m. and end by 4:00 p.m. (EDT) on May 11. The meetings are open to the public.
The purpose of the Commission, as described in section 202 of the Veterans Access, Choice, and Accountability Act of 2014, is to examine the access of veterans to health care from the Department of Veterans Affairs and strategically examine how best to organize the Veterans Health Administration, locate health care resources, and deliver health care to veterans during the next 20 years.
Any members of the public wishing to attend the meeting may register their intentions by emailing the Designated Federal Officer, John Goodrich, at
Centers for Medicare & Medicaid Services (CMS), HHS.
Proposed rule.
This proposed rule would update the prospective payment rates for inpatient rehabilitation facilities (IRFs) for federal fiscal year (FY) 2017 as required by the statute. As required by section 1886(j)(5) of the Act, this rule includes the classification and weighting factors for the IRF prospective payment system's (IRF PPS's) case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2017. We are also proposing to revise and update quality measures and reporting requirements under the IRF quality reporting program (QRP).
To be assured consideration, comments must be received at one of the addresses provided below, not later than 5 p.m. on June 20, 2016.
In commenting, please refer to file code CMS-1647-P. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission.
You may submit comments in one of four ways (please choose only one of the ways listed):
1.
2.
Please allow sufficient time for mailed comments to be received before the close of the comment period.
3.
4.
(Because access to the interior of the Hubert H. Humphrey Building is not readily available to persons without Federal government identification, commenters are encouraged to leave their comments in the CMS drop slots located in the main lobby of the building. A stamp-in clock is available for persons wishing to retain a proof of filing by stamping in and retaining an extra copy of the comments being filed.)
If you intend to deliver your comments to the Baltimore address, please call telephone number (410) 786-7195 in advance to schedule your arrival with one of our staff members.
Comments erroneously mailed to the addresses indicated as appropriate for hand or courier delivery may be delayed and received after the comment period.
For information on viewing public comments, see the beginning of the
Gwendolyn Johnson, (410) 786-6954, for general information.
Christine Grose, (410) 786-1362, for information about the quality reporting program.
Kadie Derby, (410) 786-0468, or Susanne Seagrave, (410) 786-0044, for information about the payment policies and payment rates.
The IRF PPS Addenda along with other supporting documents and tables referenced in this proposed rule are available through the Internet on the CMS Web site at
Comments received timely will also be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.
This proposed rule would update the prospective payment rates for IRFs for FY 2017 (that is, for discharges occurring on or after October 1, 2016, and on or before September 30, 2017) as required under section 1886(j)(3)(C) of the Social Security Act (the Act). As required by section 1886(j)(5) of the Act, this rule includes the classification and weighting factors for the IRF PPS's case-mix groups and a description of the methodologies and data used in computing the prospective payment rates for FY 2017. This proposed rule also proposes revisions and updates to the quality measures and reporting requirements under the IRF QRP.
In this proposed rule, we use the methods described in the FY 2016 IRF PPS final rule (80 FR 47036) to propose updates to the federal prospective payment rates for FY 2017 using updated FY 2015 IRF claims and the most recent available IRF cost report data, which is FY 2014 IRF cost report data. We are also proposing to revise and update quality measures and reporting requirements under the IRF QRP.
To assist readers in referencing sections contained in this document, we are providing the following Table of Contents.
Because of the many terms to which we refer by acronym, abbreviation, or short form in this final rule, we are listing the acronyms, abbreviation, and short forms used and their corresponding terms in alphabetical order.
Section 1886(j) of the Act provides for the implementation of a per-discharge prospective payment system (PPS) for inpatient rehabilitation hospitals and inpatient rehabilitation units of a hospital (collectively, hereinafter referred to as IRFs). Payments under the IRF PPS encompass inpatient operating and capital costs of furnishing covered rehabilitation services (that is, routine, ancillary, and capital costs), but not direct graduate medical education costs, costs of approved nursing and allied health education activities, bad debts, and other services or items outside the scope of the IRF PPS. Although a complete discussion of the IRF PPS provisions appears in the original FY 2002 IRF PPS final rule (66 FR 41316) and the FY 2006 IRF PPS final rule (70 FR 47880), we are providing below a general description of the IRF PPS for FYs 2002 through 2016.
Under the IRF PPS from FY 2002 through FY 2005 the federal prospective payment rates were computed across 100 distinct case-mix groups (CMGs), as described in the FY 2002 IRF PPS final rule (66 FR 41316). We constructed 95 CMGs using rehabilitation impairment categories (RICs), functional status (both motor and cognitive), and age (in some cases, cognitive status and age may not be a factor in defining a CMG). In addition, we constructed five special CMGs to account for very short stays and for patients who expire in the IRF.
For each of the CMGs, we developed relative weighting factors to account for a patient's clinical characteristics and expected resource needs. Thus, the weighting factors accounted for the relative difference in resource use across all CMGs. Within each CMG, we created tiers based on the estimated effects that certain comorbidities would have on resource use.
We established the federal PPS rates using a standardized payment conversion factor (formerly referred to as the budget-neutral conversion factor). For a detailed discussion of the budget-neutral conversion factor, please refer to our FY 2004 IRF PPS final rule (68 FR 45684 through 45685). In the FY 2006 IRF PPS final rule (70 FR 47880), we discussed in detail the methodology for determining the standard payment conversion factor.
We applied the relative weighting factors to the standard payment conversion factor to compute the unadjusted federal prospective payment rates under the IRF PPS from FYs 2002 through 2005. Within the structure of the payment system, we then made adjustments to account for interrupted stays, transfers, short stays, and deaths. Finally, we applied the applicable adjustments to account for geographic variations in wages (wage index), the percentage of low-income patients, location in a rural area (if applicable), and outlier payments (if applicable) to the IRFs' unadjusted federal prospective payment rates.
For cost reporting periods that began on or after January 1, 2002, and before October 1, 2002, we determined the final prospective payment amounts using the transition methodology prescribed in section 1886(j)(1) of the Act. Under this provision, IRFs transitioning into the PPS were paid a blend of the federal IRF PPS rate and the payment that the IRFs would have received had the IRF PPS not been implemented. This provision also allowed IRFs to elect to bypass this blended payment and immediately be paid 100 percent of the federal IRF PPS rate. The transition methodology expired as of cost reporting periods beginning on or after October 1, 2002 (FY 2003), and payments for all IRFs now consist of 100 percent of the federal IRF PPS rate.
We established a CMS Web site as a primary information resource for the IRF PPS which is available at
Section 1886(j) of the Act confers broad statutory authority upon the Secretary to propose refinements to the IRF PPS. In the FY 2006 IRF PPS final rule (70 FR 47880) and in correcting amendments to the FY 2006 IRF PPS final rule (70 FR 57166) that we published on September 30, 2005, we finalized a number of refinements to the IRF PPS case-mix classification system (the CMGs and the corresponding relative weights) and the case-level and facility-level adjustments. These refinements included the adoption of the Office of Management and Budget's (OMB) Core-Based Statistical Area (CBSA) market definitions, modifications to the CMGs, tier comorbidities, and CMG relative weights, implementation of a new teaching status adjustment for IRFs, revision and rebasing of the market basket index used to update IRF payments, and updates to the rural, low-income percentage (LIP), and high-cost outlier adjustments. Beginning with the FY 2006 IRF PPS final rule (70 FR 47908 through 47917), the market basket index used to update IRF payments was a market basket reflecting the operating and capital cost structures for freestanding IRFs, freestanding inpatient psychiatric facilities (IPFs), and long-term care hospitals (LTCHs) (hereinafter referred to as the rehabilitation, psychiatric, and long-term care (RPL) market basket). Any reference to the FY 2006 IRF PPS final rule in this final rule also includes the provisions effective in the correcting amendments. For a detailed discussion of the final key policy changes for FY 2006, please refer to the FY 2006 IRF PPS final rule (70 FR 47880 and 70 FR 57166).
In the FY 2007 IRF PPS final rule (71 FR 48354), we further refined the IRF PPS case-mix classification system (the CMG relative weights) and the case-level adjustments, to ensure that IRF PPS payments would continue to reflect as accurately as possible the costs of care. For a detailed discussion of the FY 2007 policy revisions, please refer to the
In the FY 2008 IRF PPS final rule (72 FR 44284), we updated the federal prospective payment rates and the outlier threshold, revised the IRF wage index policy, and clarified how we determine high-cost outlier payments for transfer cases. For more information on the policy changes implemented for FY 2008, please refer to the FY 2008 IRF PPS final rule (72 FR 44284), in which we published the final FY 2008 IRF federal prospective payment rates.
After publication of the FY 2008 IRF PPS final rule (72 FR 44284), section 115 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Pub. L. 110-173, enacted on December 29, 2007) (MMSEA), amended section 1886(j)(3)(C) of the Act to apply a zero percent increase factor for FYs 2008 and 2009, effective for IRF discharges occurring on or after April 1, 2008. Section 1886(j)(3)(C) of the Act required the Secretary to develop an increase factor to update the IRF federal prospective payment rates for each FY. Based on the legislative change to the increase factor, we revised the FY 2008 federal prospective payment rates for IRF discharges occurring on or after April 1, 2008. Thus, the final FY 2008 IRF federal prospective payment rates that were published in the FY 2008 IRF PPS final rule (72 FR 44284) were effective for discharges occurring on or after October 1, 2007, and on or before March 31, 2008; and the revised FY 2008 IRF federal prospective payment rates were effective for discharges occurring on or after April 1, 2008, and on or before September 30, 2008. The revised FY 2008 federal prospective payment rates are available on the CMS Web site at
In the FY 2009 IRF PPS final rule (73 FR 46370), we updated the CMG relative weights, the average length of stay values, and the outlier threshold; clarified IRF wage index policies regarding the treatment of “New England deemed” counties and multi-campus hospitals; and revised the regulation text in response to section 115 of the MMSEA to set the IRF compliance percentage at 60 percent (the “60 percent rule”) and continue the practice of including comorbidities in the calculation of compliance percentages. We also applied a zero percent market basket increase factor for FY 2009 in accordance with section 115 of the MMSEA. For more information on the policy changes implemented for FY 2009, please refer to the FY 2009 IRF PPS final rule (73 FR 46370), in which we published the final FY 2009 IRF federal prospective payment rates.
In the FY 2010 IRF PPS final rule (74 FR 39762) and in correcting amendments to the FY 2010 IRF PPS final rule (74 FR 50712) that we published on October 1, 2009, we updated the federal prospective payment rates, the CMG relative weights, the average length of stay values, the rural, LIP, teaching status adjustment factors, and the outlier threshold; implemented new IRF coverage requirements for determining whether an IRF claim is reasonable and necessary; and revised the regulation text to require IRFs to submit patient assessments on Medicare Advantage (MA) (formerly called Medicare Part C) patients for use in the 60 percent rule calculations. Any reference to the FY 2010 IRF PPS final rule in this final rule also includes the provisions effective in the correcting amendments. For more information on the policy changes implemented for FY 2010, please refer to the FY 2010 IRF PPS final rule (74 FR 39762 and 74 FR 50712), in which we published the final FY 2010 IRF federal prospective payment rates.
After publication of the FY 2010 IRF PPS final rule (74 FR 39762), section 3401(d) of the Patient Protection and Affordable Care Act (Pub. L. 111-148, enacted on March 23, 2010), as amended by section 10319 of the same Act and by section 1105 of the Health Care and Education Reconciliation Act of 2010 (Pub. L. 111-152, enacted on March 30, 2010) (collectively, hereinafter referred to as “The Affordable Care Act”), amended section 1886(j)(3)(C) of the Act and added section 1886(j)(3)(D) of the Act. Section 1886(j)(3)(C) of the Act requires the Secretary to estimate a multifactor productivity adjustment to the market basket increase factor, and to apply other adjustments as defined by the Act. The productivity adjustment applies to FYs from 2012 forward. The other adjustments apply to FYs 2010 to 2019.
Sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(i) of the Act defined the adjustments that were to be applied to the market basket increase factors in FYs 2010 and 2011. Under these provisions, the Secretary was required to reduce the market basket increase factor in FY 2010 by a 0.25 percentage point adjustment. Notwithstanding this provision, in accordance with section 3401(p) of the Affordable Care Act, the adjusted FY 2010 rate was only to be applied to discharges occurring on or after April 1, 2010. Based on the self-implementing legislative changes to section 1886(j)(3) of the Act, we adjusted the FY 2010 federal prospective payment rates as required, and applied these rates to IRF discharges occurring on or after April 1, 2010, and on or before September 30, 2010. Thus, the final FY 2010 IRF federal prospective payment rates that were published in the FY 2010 IRF PPS final rule (74 FR 39762) were used for discharges occurring on or after October 1, 2009, and on or before March 31, 2010, and the adjusted FY 2010 IRF federal prospective payment rates applied to discharges occurring on or after April 1, 2010, and on or before September 30, 2010. The adjusted FY 2010 federal prospective payment rates are available on the CMS Web site at
In addition, sections 1886(j)(3)(C) and (D) of the Act also affected the FY 2010 IRF outlier threshold amount because they required an adjustment to the FY 2010 RPL market basket increase factor, which changed the standard payment conversion factor for FY 2010. Specifically, the original FY 2010 IRF outlier threshold amount was determined based on the original estimated FY 2010 RPL market basket increase factor of 2.5 percent and the standard payment conversion factor of $13,661. However, as adjusted, the IRF prospective payments are based on the adjusted RPL market basket increase factor of 2.25 percent and the revised standard payment conversion factor of $13,627. To maintain estimated outlier payments for FY 2010 equal to the established standard of 3 percent of total estimated IRF PPS payments for FY 2010, we revised the IRF outlier threshold amount for FY 2010 for discharges occurring on or after April 1, 2010, and on or before September 30, 2010. The revised IRF outlier threshold amount for FY 2010 was $10,721.
Sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(i) of the Act also required the Secretary to reduce the market basket increase factor in FY 2011 by a 0.25 percentage point adjustment. The FY 2011 IRF PPS notice (75 FR 42836) and the correcting amendments to the FY 2011 IRF PPS notice (75 FR 70013) described the required adjustments to the FY 2011 and FY 2010 IRF PPS federal prospective payment rates and outlier threshold amount for IRF discharges occurring on or after April 1, 2010, and on or before September 30, 2011. It also updated the FY 2011 federal prospective payment rates, the CMG relative weights, and the average length of stay values. Any reference to the FY 2011 IRF PPS notice in this final rule also includes the provisions
In the FY 2012 IRF PPS final rule (76 FR 47836), we updated the IRF federal prospective payment rates, rebased and revised the RPL market basket, and established a new quality reporting program for IRFs in accordance with section 1886(j)(7) of the Act. We also revised regulation text for the purpose of updating and providing greater clarity. For more information on the policy changes implemented for FY 2012, please refer to the FY 2012 IRF PPS final rule (76 FR 47836), in which we published the final FY 2012 IRF federal prospective payment rates.
The FY 2013 IRF PPS notice (77 FR 44618) described the required adjustments to the FY 2013 federal prospective payment rates and outlier threshold amount for IRF discharges occurring on or after October 1, 2012, and on or before September 30, 2013. It also updated the FY 2013 federal prospective payment rates, the CMG relative weights, and the average length of stay values. For more information on the updates for FY 2013, please refer to the FY 2013 IRF PPS notice (77 FR 44618).
In the FY 2014 IRF PPS final rule (78 FR 47860), we updated the federal prospective payment rates, the CMG relative weights, and the outlier threshold amount. We also updated the facility-level adjustment factors using an enhanced estimation methodology, revised the list of diagnosis codes that count toward an IRF's 60 percent rule compliance calculation to determine “presumptive compliance,” revised sections of the Inpatient Rehabilitation Facility-Patient Assessment Instrument (IRF-PAI), revised requirements for acute care hospitals that have IRF units, clarified the IRF regulation text regarding limitation of review, updated references to previously changed sections in the regulations text, and revised and updated quality measures and reporting requirements under the IRF quality reporting program. For more information on the policy changes implemented for FY 2014, please refer to the FY 2014 IRF PPS final rule (78 FR 47860), in which we published the final FY 2014 IRF federal prospective payment rates.
In the FY 2015 IRF PPS final rule (79 FR 45872), we updated the federal prospective payment rates, the CMG relative weights, and the outlier threshold amount. We also further revised the list of diagnosis codes that count toward an IRF's 60 percent rule compliance calculation to determine “presumptive compliance,” revised sections of the IRF-PAI, and revised and updated quality measures and reporting requirements under the IRF quality reporting program. For more information on the policy changes implemented for FY 2015, please refer to the FY 2015 IRF PPS final rule (79 FR 45872) and the FY 2015 IRF PPS correction notice (79 FR 59121).
In the FY 2016 IRF PPS final rule (80 FR 47036), we updated the federal prospective payment rates, the CMG relative weights, and the outlier threshold amount. We also adopted an IRF-specific market basket that reflects the cost structures of only IRF providers, a blended one-year transition wage index based on the adoption of new OMB area delineations, a 3-year phase-out of the rural adjustment for certain IRFs due to the new OMB area delineations, and revisions and updates to the IRF QRP. For more information on the policy changes implemented for FY 2016, please refer to the FY 2016 IRF PPS final rule (80 FR 47036).
The Affordable Care Act included several provisions that affect the IRF PPS in FYs 2012 and beyond. In addition to what was previously discussed, section 3401(d) of the Affordable Care Act also added section 1886(j)(3)(C)(ii)(I) (providing for a “productivity adjustment” for fiscal year 2012 and each subsequent fiscal year). The productivity adjustment for FY 2017 is discussed in section V.B. of this proposed rule. Section 3401(d) of the Affordable Care Act requires an additional 0.75 percentage point adjustment to the IRF increase factor for FY 2017, as discussed in section V.B. of this proposed rule. Section 1886(j)(3)(C)(ii)(II) of the Act notes that the application of these adjustments to the market basket update may result in an update that is less than 0.0 for a fiscal year and in payment rates for a fiscal year being less than such payment rates for the preceding fiscal year.
Section 3004(b) of the Affordable Care Act also addressed the IRF PPS program. It reassigned the previously designated section 1886(j)(7) of the Act to section 1886(j)(8) and inserted a new section 1886(j)(7), which contains requirements for the Secretary to establish a quality reporting program for IRFs. Under that program, data must be submitted in a form and manner and at a time specified by the Secretary. Beginning in FY 2014, section 1886(j)(7)(A)(i) of the Act requires the application of a 2 percentage point reduction of the applicable market basket increase factor for IRFs that fail to comply with the quality data submission requirements. Application of the 2 percentage point reduction may result in an update that is less than 0.0 for a fiscal year and in payment rates for a fiscal year being less than such payment rates for the preceding fiscal year. Reporting-based reductions to the market basket increase factor will not be cumulative; they will only apply for the FY involved.
Under section 1886(j)(7)(D)(i) and (ii) of the Act, the Secretary is generally required to select quality measures for the IRF quality reporting program from those that have been endorsed by the consensus-based entity which holds a performance measurement contract under section 1890(a) of the Act. This contract is currently held by the National Quality Forum (NQF). So long as due consideration is given to measures that have been endorsed or adopted by a consensus-based organization, section 1886(j)(7)(D)(ii) of the Act authorizes the Secretary to select non-endorsed measures for specified areas or medical topics when there are no feasible or practical endorsed measure(s).
Section 1886(j)(7)(E) of the Act requires the Secretary to establish procedures for making the IRF PPS quality reporting data available to the public. In so doing, the Secretary must ensure that IRFs have the opportunity to review any such data prior to its release to the public.
As described in the FY 2002 IRF PPS final rule, upon the admission and discharge of a Medicare Part A Fee-for-Service (FFS) patient, the IRF is required to complete the appropriate sections of a patient assessment instrument (PAI), designated as the IRF-PAI. In addition, beginning with IRF discharges occurring on or after October 1, 2009, the IRF is also required to complete the appropriate sections of the IRF-PAI upon the admission and discharge of each Medicare Advantage (MA) (formerly called Medicare Part C) patient, as described in the FY 2010 IRF PPS final rule. All required data must be electronically encoded into the IRF-PAI software product. Generally, the software product includes patient classification programming called the Grouper software. The Grouper software uses specific IRF-PAI data elements to classify (or group) patients into distinct
The Grouper software produces a 5-character CMG number. The first character is an alphabetic character that indicates the comorbidity tier. The last 4 characters are numeric characters that represent the distinct CMG number. Free downloads of the Inpatient Rehabilitation Validation and Entry (IRVEN) software product, including the Grouper software, are available on the CMS Web site at
Once a Medicare FFS Part A patient is discharged, the IRF submits a Medicare claim as a Health Insurance Portability and Accountability Act of 1996 (Pub. L. 104-191, enacted on August 21, 1996) (HIPAA) compliant electronic claim or, if the Administrative Simplification Compliance Act of 2002 (Pub. L. 107-105, enacted on December 27, 2002) (ASCA) permits, a paper claim (a UB-04 or a CMS-1450 as appropriate) using the five-character CMG number and sends it to the appropriate Medicare Administrative Contractor (MAC). In addition, once a Medicare Advantage patient is discharged, in accordance with the Medicare Claims Processing Manual, chapter 3, section 20.3 (Pub. 100-04), hospitals (including IRFs) must submit an informational-only bill (Type of Bill (TOB) 111), which includes Condition Code 04 to their MAC. This will ensure that the Medicare Advantage days are included in the hospital's Supplemental Security Income (SSI) ratio (used in calculating the IRF low-income percentage adjustment) for fiscal year 2007 and beyond. Claims submitted to Medicare must comply with both ASCA and HIPAA.
Section 3 of the ASCA amends section 1862(a) of the Act by adding paragraph (22), which requires the Medicare program, subject to section 1862(h) of the Act, to deny payment under Part A or Part B for any expenses for items or services “for which a claim is submitted other than in an electronic form specified by the Secretary.” Section 1862(h) of the Act, in turn, provides that the Secretary shall waive such denial in situations in which there is no method available for the submission of claims in an electronic form or the entity submitting the claim is a small provider. In addition, the Secretary also has the authority to waive such denial “in such unusual cases as the Secretary finds appropriate.” For more information, see the “Medicare Program; Electronic Submission of Medicare Claims” final rule (70 FR 71008). Our instructions for the limited number of Medicare claims submitted on paper are available at
Section 3 of the ASCA operates in the context of the administrative simplification provisions of HIPAA, which include, among others, the requirements for transaction standards and code sets codified in 45 CFR, parts 160 and 162, subparts A and I through R (generally known as the Transactions Rule). The Transactions Rule requires covered entities, including covered health care providers, to conduct covered electronic transactions according to the applicable transaction standards. (See the CMS program claim memoranda at
The MAC processes the claim through its software system. This software system includes pricing programming called the “Pricer” software. The Pricer software uses the CMG number, along with other specific claim data elements and provider-specific data, to adjust the IRF's prospective payment for interrupted stays, transfers, short stays, and deaths, and then applies the applicable adjustments to account for the IRF's wage index, percentage of low-income patients, rural location, and outlier payments. For discharges occurring on or after October 1, 2005, the IRF PPS payment also reflects the teaching status adjustment that became effective as of FY 2006, as discussed in the FY 2006 IRF PPS final rule (70 FR 47880).
The Department of Health & Human Services (HHS) has a number of initiatives designed to encourage and support the adoption of health information technology and to promote nationwide health information exchange to improve health care. As discussed in the August 2013 Statement “Principles and Strategies for Accelerating Health Information Exchange” (available at
The Office of the National Coordinator for Health Information Technology (ONC) has released a document entitled “Connecting Health and Care for the Nation: A Shared Nationwide Interoperability Roadmap” (available at
The Roadmap identifies four critical pathways that health IT stakeholders should focus on now in order to create a foundation for long-term success: (1) Improve technical standards and implementation guidance for priority data domains and associated elements; (2) rapidly shift and align federal, state, and commercial payment policies from FFS to value-based models to stimulate the demand for interoperability; (3) clarify and align federal and state privacy and security requirements that enable interoperability; and (4) align and promote the use of consistent policies and business practices that support interoperability, in coordination with stakeholders. In addition, ONC has released the final version of the 2016 Interoperability Standards Advisory (available at
We encourage stakeholders to utilize health information exchange and certified health IT to effectively and
In this proposed rule, we propose to update the IRF federal prospective payment rates for FY 2017 and to revise and update quality measures and reporting requirements under the IRF QRP.
The proposed updates to the IRF federal prospective payment rates for FY 2017 are as follows:
• Update the FY 2017 IRF PPS relative weights and average length of stay values using the most current and complete Medicare claims and cost report data in a budget-neutral manner, as discussed in section III of this proposed rule.
• Describe the continued use of FY 2014 facility-level adjustment factors as discussed in section IV of this proposed rule.
• Update the FY 2017 IRF PPS payment rates by the proposed market basket increase factor, based upon the most current data available, with a 0.75 percentage point reduction as required by sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(v) of the Act and a proposed productivity adjustment required by section 1886(j)(3)(C)(ii)(I) of the Act, as described in section V of this proposed rule.
• Update the FY 2017 IRF PPS payment rates by the FY 2017 wage index and the labor-related share in a budget-neutral manner, as discussed in section V of this proposed rule.
• Describe the calculation of the IRF standard payment conversion factor for FY 2017, as discussed in section V of this proposed rule.
• Update the outlier threshold amount for FY 2017, as discussed in section VI of this proposed rule.
• Update the cost-to-charge ratio (CCR) ceiling and urban/rural average CCRs for FY 2017, as discussed in section VI of this proposed rule.
• Describe proposed revisions and updates to quality measures and reporting requirements under the quality reporting program for IRFs in accordance with section 1886(j)(7) of the Act, as discussed in section VII of this proposed rule.
As specified in § 412.620(b)(1), we calculate a relative weight for each CMG that is proportional to the resources needed by an average inpatient rehabilitation case in that CMG. For example, cases in a CMG with a relative weight of 2, on average, will cost twice as much as cases in a CMG with a relative weight of 1. Relative weights account for the variance in cost per discharge due to the variance in resource utilization among the payment groups, and their use helps to ensure that IRF PPS payments support beneficiary access to care, as well as provider efficiency.
In this proposed rule, we propose to update the CMG relative weights and average length of stay values for FY 2017. As required by statute, we always use the most recent available data to update the CMG relative weights and average lengths of stay. For FY 2017, we propose to use the FY 2015 IRF claims and FY 2014 IRF cost report data. These data are the most current and complete data available at this time. Currently, only a small portion of the FY 2015 IRF cost report data are available for analysis, but the majority of the FY 2015 IRF claims data are available for analysis.
In this proposed rule, we propose to apply these data using the same methodologies that we have used to update the CMG relative weights and average length of stay values each fiscal year since we implemented an update to the methodology to use the more detailed CCR data from the cost reports of IRF subprovider units of primary acute care hospitals, instead of CCR data from the associated primary care hospitals, to calculate IRFs' average costs per case, as discussed in the FY 2009 IRF PPS final rule (73 FR 46372). In calculating the CMG relative weights, we use a hospital-specific relative value method to estimate operating (routine and ancillary services) and capital costs of IRFs. The process used to calculate the CMG relative weights for this proposed rule is as follows:
Consistent with the methodology that we have used to update the IRF classification system in each instance in the past, we propose to update the CMG relative weights for FY 2017 in such a way that total estimated aggregate payments to IRFs for FY 2017 are the same with or without the changes (that is, in a budget-neutral manner) by applying a budget neutrality factor to the standard payment amount. To calculate the appropriate budget neutrality factor for use in updating the FY 2017 CMG relative weights, we use the following steps:
In section V.E. of this proposed rule, we discuss the proposed use of the existing methodology to calculate the proposed standard payment conversion factor for FY 2017.
In Table 1, “Proposed Relative Weights and Average Length of Stay Values for Case-Mix Groups,” we present the CMGs, the comorbidity tiers, the corresponding relative weights, and the average length of stay values for each CMG and tier for FY 2017. The average length of stay for each CMG is used to determine when an IRF discharge meets the definition of a short-stay transfer, which results in a per diem case level adjustment.
Generally, updates to the CMG relative weights result in some increases and some decreases to the CMG relative weight values. Table 2 shows how we estimate that the application of the proposed revisions for FY 2017 would affect particular CMG relative weight values, which would affect the overall distribution of payments within CMGs and tiers. Note that, because we propose to implement the CMG relative weight revisions in a budget-neutral manner (as previously described), total estimated aggregate payments to IRFs for FY 2017 would not be affected as a result of the proposed CMG relative weight revisions. However, the proposed revisions would affect the distribution of payments within CMGs and tiers.
As Table 2 shows, 99.5 percent of all IRF cases are in CMGs and tiers that would experience less than a 5 percent change (either increase or decrease) in the CMG relative weight value as a result of the proposed revisions for FY 2017. The largest estimated increase in the proposed CMG relative weight values that affects the largest number of IRF discharges would be a 0.1 percent increase in the CMG relative weight value for CMG 0704—Fracture of lower extremity, with a motor score less than 28.15-in the “no comorbidity” tier. In the FY 2015 claims data, 18,696 IRF discharges (4.8 percent of all IRF discharges) were classified into this CMG and tier.
The largest decrease in a CMG relative weight value affecting the largest number of IRF cases would be a 1.4 percent decrease in the CMG relative weight for CMG 0110—Stroke, with a motor score less than 22.35 and age less than 84.5 -in the “no comorbidity” tier. In the FY 2015 IRF claims data, this change would have affected 13,587 cases (3.5 percent of all IRF cases).
The proposed changes in the average length of stay values for FY 2017, compared with the FY 2016 average length of stay values, are small and do not show any particular trends in IRF length of stay patterns.
We invite public comment on our proposed updates to the CMG relative weights and average length of stay values for FY 2017.
Section 1886(j)(3)(A)(v) of the Act confers broad authority upon the Secretary to adjust the per unit payment rate by such factors as the Secretary determines are necessary to properly reflect variations in necessary costs of treatment among rehabilitation facilities. Under this authority, we currently adjust the federal prospective payment amount associated with a CMG to account for facility-level characteristics such as an IRF's LIP, teaching status, and location in a rural area, if applicable, as described in § 412.624(e).
Based on the substantive changes to the facility-level adjustment factors that were adopted in the FY 2014 final rule (78 FR 47860, 47868 through 47872), in the FY 2015 final rule (79 FR 45872, 45882 through 45883), we froze the facility-level adjustment factors at the FY 2014 levels for FY 2015 and all subsequent years (unless and until we propose to update them again through future notice-and-comment rulemaking). For FY 2017, we will continue to hold the adjustment factors at the FY 2014 levels as we continue to monitor the most current IRF claims data available and continue to evaluate and monitor the effects of the FY 2014 changes.
Section 1886(j)(3)(C) of the Act requires the Secretary to establish an increase factor that reflects changes over time in the prices of an appropriate mix of goods and services included in the covered IRF services, which is referred to as a market basket index. According to section 1886(j)(3)(A)(i) of the Act, the increase factor shall be used to update the IRF federal prospective payment rates for each FY. Section 1886(j)(3)(C)(ii)(I) of the Act requires the application of a productivity adjustment, as described below. In addition, sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(v) of the Act require the application of a 0.75 percentage point reduction to the market basket increase factor for FY 2017. Thus, in this proposed rule, we propose to update the IRF PPS payments for FY 2017 by a market basket increase factor as required by section 1886(j)(3)(C) of the Act, with a productivity adjustment as required by section 1886(j)(3)(C)(ii)(I) of the Act, and a 0.75 percentage point reduction as required by sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(v) of the Act.
For FY 2015, IRF PPS payments were updated using the 2008-based RPL market basket. Beginning with the FY 2016 IRF PPS, we created and adopted a stand-alone IRF market basket, which was referred to as the 2012-based IRF market basket, reflecting the operating and capital cost structures for freestanding IRFs and hospital-based IRFs. The general structure of the 2012-based IRF market basket is similar to the 2008-based RPL market basket; however, we made several notable changes. In developing the 2012-based IRF market basket, we derived cost weights from Medicare cost report data for both freestanding and hospital-based IRFs (the 2008-based RPL market basket was based on freestanding data only), incorporated the 2007 Input-Output data from the Bureau of Economic Analysis (the 2008-based RPL market basket was based on the 2002 Input-Output data); used new price proxy blends for two cost categories (Fuel, Oil,
For FY 2017, we are proposing to use the same methodology described in the FY 2016 IRF PPS final rule (80 FR 47066) to compute the FY 2017 market basket increase factor to update the IRF PPS base payment rate. Consistent with historical practice, we are proposing to estimate the market basket update for the IRF PPS based on IHS Global Insight's forecast using the most recent available data. IHS Global Insight (IGI), Inc. is a nationally recognized economic and financial forecasting firm with which CMS contracts to forecast the components of the market baskets and multifactor productivity (MFP).
Based on IGI's first quarter 2016 forecast with historical data through the fourth quarter of 2015, the projected 2012-based IRF market basket increase factor for FY 2017 would be 2.7 percent. Therefore, consistent with our historical practice of estimating market basket increases based on the best available data, we are proposing a market basket increase factor of 2.7 percent for FY 2017. We are also proposing that if more recent data are subsequently available (for example, a more recent estimate of the market basket update), we would use such data to determine the FY 2017 update in the final rule.
According to section 1886(j)(3)(C)(i) of the Act, the Secretary shall establish an increase factor based on an appropriate percentage increase in a market basket of goods and services. Section 1886(j)(3)(C)(ii) of the Act then requires that, after establishing the increase factor for a FY, the Secretary shall reduce such increase factor for FY 2012 and each subsequent FY, by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act. Section 1886(b)(3)(B)(xi)(II) of the Act sets forth the definition of this productivity adjustment. The statute defines the productivity adjustment to be equal to the 10-year moving average of changes in annual economy-wide private nonfarm business MFP (as projected by the Secretary for the 10-year period ending with the applicable FY, year, cost reporting period, or other annual period) (the “MFP adjustment”). The BLS publishes the official measure of private nonfarm business MFP. Please see
Using IGI's first quarter 2016 forecast, the MFP adjustment for FY 2017 (the 10-year moving average of MFP for the period ending FY 2017) is currently projected to be 0.5 percent. Thus, in accordance with section 1886(j)(3)(C) of the Act, we are proposing to base the FY 2017 market basket update, which is used to determine the applicable percentage increase for the IRF payments, on the most recent estimate of the 2012-based IRF market basket. We are proposing to then reduce this percentage increase by the most up-to-date estimate of the MFP adjustment for FY 2017 of 0.5 percentage point (the 10-year moving average of MFP for the period ending FY 2017 based on IGI's first quarter 2016 forecast). Following application of the MFP, we are proposing to further reduce the applicable percentage increase by 0.75 percentage point, as required by sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(v) of the Act. Therefore, the estimate of the FY 2017 IRF update for the proposed rule is 1.45 percent (2.7 percent market basket update, less 0.5 percentage point MFP adjustment, less 0.75 percentage point legislative adjustment). Furthermore, we propose that if more recent data are subsequently available (for example, a more recent estimate of the market basket update and MFP adjustment), we would use such data to determine the FY 2017 market basket update and MFP adjustment in the final rule.
For FY 2017, the Medicare Payment Advisory Commission (MedPAC) recommends that a 0-percent update be applied to IRF PPS payment rates. As discussed, and in accordance with sections 1886(j)(3)(C) and 1886(j)(3)(D) of the Act, the Secretary is proposing to update the IRF PPS payment rates for FY 2017 by an adjusted market basket increase factor of 1.45 percent, as section 1886(j)(3)(C) of the Act does not provide the Secretary with the authority to apply a different update factor to IRF PPS payment rates for FY 2017.
Section 1886(j)(6) of the Act specifies that the Secretary is to adjust the proportion (as estimated by the Secretary from time to time) of rehabilitation facilities' costs which are attributable to wages and wage-related costs of the prospective payment rates computed under section 1886(j)(3) for area differences in wage levels by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the rehabilitation facility compared to the national average wage level for such facilities. The labor-related share is determined by identifying the national average proportion of total costs that are related to, influenced by, or vary with the local labor market. We continue to classify a cost category as labor-related if the costs are labor-intensive and vary with the local labor market.
Based on our definition of the labor-related share and the cost categories in the 2012-based IRF market basket, we propose to include in the labor-related share for FY 2017 the sum of the FY 2017 relative importance of Wages and Salaries, Employee Benefits, Professional Fees: Labor- Related, Administrative and Facilities Support Services, Installation, Maintenance, and Repair, All Other: Labor-related Services, and a portion of the Capital-Related cost weight from the 2012-based IRF market basket. For more details regarding the methodology for determining specific cost categories for inclusion in the 2012-based IRF labor-related share, see the FY 2016 IRF final rule (80 FR 47066 through 47068).
Using this proposed method and the IHS Global Insight, Inc. first quarter 2016 forecast for the 2012-based IRF market basket, the proposed IRF labor-related share for FY 2017 is the sum of the FY 2017 relative importance of each labor-related cost category. The relative importance reflects the different rates of price change for these cost categories between the base year (FY 2012) and FY 2017.
The sum of the relative importance for FY 2017 operating costs (Wages and Salaries, Employee Benefits, Professional Fees: Labor-related, Administrative and Facilities Support Services, Installation Maintenance & Repair Services, and All Other: Labor-related Services) using the 2012-based IRF market basket is 67.1 percent, as shown in Table 3.
We propose that the portion of Capital that is influenced by the local labor market is estimated to be 46 percent. Since the relative importance for
Section 1886(j)(6) of the Act requires the Secretary to adjust the proportion of rehabilitation facilities' costs attributable to wages and wage-related costs (as estimated by the Secretary from time to time) by a factor (established by the Secretary) reflecting the relative hospital wage level in the geographic area of the rehabilitation facility compared to the national average wage level for those facilities. The Secretary is required to update the IRF PPS wage index on the basis of information available to the Secretary on the wages and wage-related costs to furnish rehabilitation services. Any adjustment or updates made under section 1886(j)(6) of the Act for a FY are made in a budget-neutral manner.
For FY 2017, we propose to maintain the policies and methodologies described in the FY 2016 IRF PPS final rule (80 FR 47036, 47068 through 47075) related to the labor market area definitions and the wage index methodology for areas with wage data. Thus, we propose to use the CBSA labor market area definitions and the FY 2016 pre-reclassification and pre-floor hospital wage index data. The current statistical areas which were implemented in FY 2016 are based on OMB standards published on February 28, 2013, in OMB Bulletin No. 13-01. For FY 2017, we are continuing to use the new OMB delineations that we adopted beginning with FY 2016. In accordance with section 1886(d)(3)(E) of the Act, the FY 2016 pre-reclassification and pre-floor hospital wage index is based on data submitted for hospital cost reporting periods beginning on or after October 1, 2011, and before October 1, 2012 (that is, FY 2012 cost report data).
The labor market designations made by the OMB include some geographic areas where there are no hospitals and, thus, no hospital wage index data on which to base the calculation of the IRF PPS wage index. We propose to continue to use the same methodology discussed in the FY 2008 IRF PPS final rule (72 FR 44299) to address those geographic areas where there are no hospitals and, thus, no hospital wage index data on which to base the calculation for the FY 2017 IRF PPS wage index.
The wage index used for the IRF PPS is calculated using the pre-reclassification and pre-floor acute care hospital wage index data and is assigned to the IRF on the basis of the labor market area in which the IRF is geographically located. IRF labor market areas are delineated based on the CBSAs established by the OMB. In the FY 2016 IRF PPS final rule (80 FR 47036, 47068), we established an IRF wage index based on FY 2011 acute care hospital wage data to adjust the FY 2016 IRF payment rates. We also adopted the revised CBSAs set forth by OMB. The current CBSA delineations (which were implemented for the IRF PPS beginning with FY 2016) are based on revised OMB delineations issued on February 28, 2013, in OMB Bulletin No. 13-01. OMB Bulletin No. 13-01 established revised delineations for Metropolitan Statistical Areas, Micropolitan Statistical Areas, and Combined Statistical Areas in the United States and Puerto Rico, and provided guidance on the use of the delineations of these statistical areas based on new standards published on June 28, 2010, in the
In FY 2016, we applied a 1-year blended wage index for all IRF providers to mitigate the impact of the wage index change due to the implementation of the revised CBSA delineations. In FY 2016, all IRF providers received a blended wage index using 50 percent of their FY 2016 wage index based on the revised OMB CBSA delineations and 50 percent of their FY 2016 wage index based on the OMB delineations used in FY 2015. We propose to maintain the policy established in FY 2016 IRF PPS final rule related to the blended one-year transition wage index (80 FR 47036, 47073 through 47074). This 1-year blended wage index became effective on
For FY 2016, in addition to the blended wage index, we also adopted a 3-year budget neutral phase out of the rural adjustment for FY 2015 rural IRFs that became urban in FY 2016 under the revised CBSA delineations. In FY 2016, IRFs that were designated as rural in FY 2015 and became designated as urban in FY 2016 received two-thirds of the 2015 rural adjustment of 14.9 percent. FY 2017 represents the second year of the 3-year phase out of the rural adjustment, in which these same IRFs will receive one-third of the 2015 rural adjustment of 14.9 percent, as finalized in the FY 2016 IRF PPS final rule (80 FR 47036, 47073 through 47074).
For FY 2017, the proposed wage index will be based solely on the previously adopted revised CBSA delineations and their respective wage index (rather than on a blended wage index). We are not proposing any additional wage index transition adjustments for IRF providers due to the adoption of the new OMB delineations in FY 2016, but will continue the 3-year phase out of the rural adjustments for IRF providers that changed from rural to urban status that was finalized in the FY 2016 IFR PPS final rule (80 FR 47036, 47073 through 47074).
For a full discussion of our implementation of the new OMB labor market area delineations for the FY 2016 wage index, please refer to the FY 2016 IRF PPS final rule (80 FR 47036, 47068 through 47076). We are not proposing any changes to this policy in this proposed rule. For FY 2017, 19 IRFs that were designated as rural in FY 2015 and became designated as urban in FY 2016 will receive the proposed FY 2017 wage index (based solely on the revised CBSA delineations) and one-third of the FY 2015 rural adjustment of 14.9 percent (80 FR 47036, 47073 through 47076). The proposed wage index applicable to FY 2017 is available on the CMS Web site at
To calculate the wage-adjusted facility payment for the payment rates set forth in this proposed rule, we multiply the unadjusted federal payment rate for IRFs by the FY 2017 labor-related share based on the 2012-based IRF market basket (71.0 percent) to determine the labor-related portion of the standard payment amount. A full discussion of the calculation of the labor-related share is located in section V.C of this proposed rule. We then multiply the labor-related portion by the applicable IRF wage index from the tables in the addendum to this proposed rule. These tables are available through the Internet on the CMS Web site at
Adjustments or updates to the IRF wage index made under section 1886(j)(6) of the Act must be made in a budget-neutral manner. We propose to calculate a budget-neutral wage adjustment factor as established in the FY 2004 IRF PPS final rule (68 FR 45689), codified at § 412.624(e)(1), as described in the steps below. We propose to use the listed steps to ensure that the FY 2017 IRF standard payment conversion factor reflects the proposed update to the wage indexes (based on the FY 2012 hospital cost report data) and the labor-related share in a budget-neutral manner:
We discuss the calculation of the proposed standard payment conversion factor for FY 2017 in section V.E of this proposed rule.
We invite public comment on the proposed IRF wage adjustment for FY 2017.
To calculate the proposed standard payment conversion factor for FY 2017, as illustrated in Table 4, we begin by applying the proposed adjusted market basket increase factor for FY 2017 that was adjusted in accordance with sections 1886(j)(3)(C) and (D) of the Act, to the standard payment conversion factor for FY 2016 ($15,478). Applying the proposed 1.45 percent adjusted market basket increase for FY 2017 to the standard payment conversion factor for FY 2016 of $15,478 yields a standard payment amount of $15,702. Then, we apply the proposed budget neutrality factor for the FY 2017 wage index and labor-related share of 0.9992, which results in a proposed standard payment amount of $15,690. We next apply the proposed budget neutrality factors for the revised CMG relative weights of 0.9990, which results in the proposed standard payment conversion factor of $15,674 for FY 2017.
We invite public comment on the proposed FY 2017 standard payment conversion factor.
After the application of the proposed CMG relative weights described in section III of this proposed rule to the proposed FY 2017 standard payment conversion factor ($15,674), the resulting proposed unadjusted IRF
Table 6 illustrates the methodology for adjusting the proposed federal prospective payments (as described in sections V.A. through V.F. of this proposed rule). The following examples are based on two hypothetical Medicare beneficiaries, both classified into CMG 0110 (without comorbidities). The proposed unadjusted federal prospective payment rate for CMG 0110 (without comorbidities) appears in Table 5.
To calculate each IRF's labor and non-labor portion of the federal prospective payment, we begin by taking the unadjusted federal prospective payment rate for CMG 0110 (without comorbidities) from Table 5. Then, we multiply the labor-related share for FY 2017 (71.0 percent) described in section V.E. of this proposed rule by the proposed unadjusted federal prospective payment rate. To determine the non-labor portion of the proposed federal prospective payment rate, we subtract the labor portion of the proposed federal payment from the proposed unadjusted federal prospective payment.
To compute the proposed wage-adjusted federal prospective payment, we multiply the labor portion of the proposed federal payment by the appropriate proposed wage index located in tables A and B. These tables are available on CMS Web site at
Adjusting the proposed wage-adjusted federal payment by the facility-level adjustments involves several steps. First, we take the wage-adjusted federal prospective payment and multiply it by the appropriate rural and LIP adjustments (if applicable). Second, to determine the appropriate amount of additional payment for the teaching status adjustment (if applicable), we multiply the teaching status adjustment (0.0784, in this example) by the wage-adjusted and rural-adjusted amount (if applicable). Finally, we add the additional teaching status payments (if applicable) to the wage, rural, and LIP-adjusted federal prospective payment rates. Table 6 illustrates the components of the adjusted payment calculation.
Thus, the proposed adjusted payment for Facility A would be $34,135.35, and the proposed adjusted payment for Facility B would be $34,092.54.
Section 1886(j)(4) of the Act provides the Secretary with the authority to make payments in addition to the basic IRF prospective payments for cases incurring extraordinarily high costs. A case qualifies for an outlier payment if the estimated cost of the case exceeds the adjusted outlier threshold. We calculate the adjusted outlier threshold by adding the IRF PPS payment for the case (that is, the CMG payment adjusted by all of the relevant facility-level adjustments) and the adjusted threshold amount (also adjusted by all of the relevant facility-level adjustments). Then, we calculate the estimated cost of a case by multiplying the IRF's overall CCR by the Medicare allowable covered charge. If the estimated cost of the case is higher than the adjusted outlier threshold, we make an outlier payment for the case equal to 80 percent of the difference between the estimated cost of the case and the outlier threshold.
In the FY 2002 IRF PPS final rule (66 FR 41362 through 41363), we discussed our rationale for setting the outlier threshold amount for the IRF PPS so that estimated outlier payments would equal 3 percent of total estimated payments. For the 2002 IRF PPS final rule, we analyzed various outlier policies using 3, 4, and 5 percent of the total estimated payments, and we concluded that an outlier policy set at 3 percent of total estimated payments would optimize the extent to which we could reduce the financial risk to IRFs of caring for high-cost patients, while still providing for adequate payments for all other (non-high cost outlier) cases.
Subsequently, we updated the IRF outlier threshold amount in the FYs 2006 through 2016 IRF PPS final rules and the FY 2011 and FY 2013 notices (70 FR 47880, 71 FR 48354, 72 FR 44284, 73 FR 46370, 74 FR 39762, 75 FR 42836, 76 FR 47836, 76 FR 59256, and 77 FR 44618, 78 FR 47860, 79 FR 45872, 80 FR 47036, respectively) to maintain estimated outlier payments at 3 percent of total estimated payments. We also stated in the FY 2009 final rule (73 FR 46370 at 46385) that we would continue to analyze the estimated outlier payments for subsequent years and adjust the outlier threshold amount as appropriate to maintain the 3 percent target.
To update the IRF outlier threshold amount for FY 2017, we propose to use FY 2015 claims data and the same methodology that we used to set the initial outlier threshold amount in the FY 2002 IRF PPS final rule (66 FR 41316 and 41362 through 41363), which is also the same methodology that we used to update the outlier threshold amounts for FYs 2006 through 2016. Based on an analysis of the preliminary data used for the proposed rule, we estimated that IRF outlier payments as a percentage of total estimated payments would be approximately 2.8 percent in FY 2016. Therefore, we propose to update the outlier threshold amount from $8,658 for FY 2016 to $8,301 for FY 2017 to maintain estimated outlier payments at approximately 3 percent of total estimated aggregate IRF payments for FY 2017.
We invite public comment on the proposed update to the FY 2017 outlier threshold amount to maintain estimated outlier payments at approximately 3 percent of total estimated IRF payments.
In accordance with the methodology stated in the FY 2004 IRF PPS final rule (68 FR 45674, 45692 through 45694), we propose to apply a ceiling to IRFs' CCRs. Using the methodology described in that final rule, we propose to update the national urban and rural CCRs for IRFs, as well as the national CCR ceiling for FY 2017, based on analysis of the most recent data that is available. We apply the national urban and rural CCRs in the following situations:
• New IRFs that have not yet submitted their first Medicare cost report.
• IRFs whose overall CCR is in excess of the national CCR ceiling for FY 2017, as discussed below.
• Other IRFs for which accurate data to calculate an overall CCR are not available.
Specifically, for FY 2017, we propose to estimate a national average CCR of 0.562 for rural IRFs, which we calculated by taking an average of the CCRs for all rural IRFs using their most recently submitted cost report data. Similarly, we propose to estimate a national average CCR of 0.435 for urban IRFs, which we calculated by taking an average of the CCRs for all urban IRFs using their most recently submitted cost report data. We apply weights to both of these averages using the IRFs' estimated costs, meaning that the CCRs of IRFs with higher costs factor more heavily into the averages than the CCRs of IRFs with lower costs. For this proposed rule, we have used the most recent available cost report data (FY 2014). This includes all IRFs whose cost reporting periods begin on or after October 1, 2013, and before October 1, 2014. If, for any IRF, the FY 2014 cost report was missing or had an “as submitted” status, we used data from a previous fiscal year's (that is, FY 2004 through FY 2013) settled cost report for that IRF. We do not use cost report data from before FY 2004 for any IRF because changes in IRF utilization since FY 2004 resulting from the 60 percent rule and IRF medical review activities suggest that these older data do not adequately reflect the current cost of care.
In accordance with past practice, we propose to set the national CCR ceiling at 3 standard deviations above the mean CCR. Using this method, the proposed national CCR ceiling would be 1.36 for FY 2017. This means that, if an
The proposed national average rural and urban CCRs and the proposed national CCR ceiling in this section will be updated in the final rule if more recent data becomes available to use in these analyses.
We invite public comment on the proposed update to the IRF CCR ceiling and the urban/rural averages for FY 2017.
We seek to promote higher quality and more efficient health care for Medicare beneficiaries, and our efforts are furthered by QRPs coupled with public reporting of that information. Section 3004(b) of the Affordable Care Act amended section 1886(j)(7) of the Act, requiring the Secretary to establish the IRF QRP. This program applies to freestanding IRFs, as well as IRF units affiliated with either acute care facilities or critical access hospitals (CAHs). Beginning with the FY 2014 payment determination and subsequent years, the Secretary is required to reduce any annual update to the standard federal rate for discharges occurring during such fiscal year by 2 percentage points for any IRF that does not comply with the requirements established by the Secretary. Section 1886(j)(7) of the Act requires that for the FY 2014 payment determination and subsequent years, each IRF submit data on quality measures specified by the Secretary in a form and manner, and at a time, specified by the Secretary. For more information on the statutory history of the IRF QRP, please refer to the FY 2015 IRF PPS final rule (79 FR 45908).
The Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act) imposed new data reporting requirements for certain PAC providers, including IRFs. For information on the statutory background of the IMPACT Act, please refer to the FY 2016 IRF PPS final rule (80 FR 47080 through 47083).
In the FY 2016 IRF PPS final rule, we reviewed general activities and finalized the general timeline and sequencing of such activities that would occur under the IRF QRP. For further information, please refer to the FY 2016 IRF PPS final rule (80 FR 40708 through 47128). In addition, we established our approach for identifying cross-cutting measures and process for the adoption of measures, including the application and purpose of the Measures Application Partnership (MAP) and the notice-and-comment rulemaking process (80 FR 47080 through 47084). For information on these topics, please refer to the FY 2016 IRF PPS final rule (80 FR 47080).
For a detailed discussion of the considerations we use for the selection of IRF QRP quality measures, such as alignment with the CMS Quality Strategy,
In this proposed rule, we propose to adopt for the IRF QRP one measure that we are specifying under section 1899B(c)(1) of the Act to meet the Medication Reconciliation domain, that is, Drug Regimen Review Conducted with Follow-Up for Identified Issues-Post Acute Care Inpatient Rehabilitation Facility Quality Reporting Program. Further, we are proposing to adopt for the IRF QRP, three measures to meet the resource use and other measure domains identified in section 1899B(d)(1) of the Act. These include: (1) Total Estimated Medicare Spending per Beneficiary: Medicare Spending Per Beneficiary-Post Acute Care Inpatient Rehabilitation Facility Quality Reporting Program; (2) Discharge to Community: Discharge to Community-Post Acute Care Inpatient Rehabilitation Facility Quality Reporting Program, and (3) Measures to reflect all-condition risk-adjusted potentially preventable hospital readmission rates: Potentially Preventable 30-Day Post-Discharge Readmission Measure for Inpatient Rehabilitation Facility Quality Reporting Program. Also, we are proposing an additional measure: (4) Potentially Preventable Within Stay Readmission Measure for Inpatient Rehabilitation Facilities.
In our selection and specification of measures, we employ a transparent process in which we seek input from stakeholders and national experts and engage in a process that allows for pre-rulemaking input on each measure, as required by section 1890A of the Act. To meet this requirement, we provided the following opportunities for stakeholder input: Our measure development contractor convened technical expert panel (TEPs) that included stakeholder experts and patient representatives on July 29, 2015, for the Drug Regimen Review Conducted with Follow-Up for Identified Issues measures; on August 25, 2015, September 25, 2015, and October 5, 2015, for the Discharge to Community measures; on August 12 and 13, 2015, and October 14, 2015, for the Potentially Preventable 30-Day Post-Discharge Readmission Measures and Potentially Preventable Within Stay Readmission Measure for IRFs; and on October 29 and 30, 2015, for the Medicare Spending per Beneficiary (MSPB) measures. In addition, we released draft quality measure specifications for public comment for the Drug Regimen Review Conducted with Follow-Up for Identified Issues measures from September 18, 2015, to October 6, 2015; for the Discharge to Community measures from November 9, 2015, to December 8, 2015; for the Potentially Preventable 30-Day Post-Discharge Readmission Measure for
Additionally, we sought public input from the MAP Post-Acute Care, Long-Term Care Workgroup during the annual in-person meeting held December 14 and 15, 2015. The MAP is composed of multi-stakeholder groups convened by the NQF, our current contractor under section 1890(a) of the Act, tasked to provide input on the selection of quality and efficiency measures described in section 1890(b)(7)(B) of the Act.
The MAP reviewed each IMPACT Act-related measure, as well as other quality measures proposed in this rule for use in the IRF QRP. For more information on the MAP's recommendations, please refer to the MAP 2016 Final Recommendations to HHS and CMS public report at
For measures that do not have NQF endorsement, or which are not fully supported by the MAP for use in the IRF QRP, we are proposing for the IRF QRP for the purposes of satisfying the measure domains required under the IMPACT Act, measures that closely align with the national priorities identified in the National Quality Strategy (
In the CY 2013 Hospital Outpatient Prospective Payment System/Ambulatory Surgical Center (OPPS/ASC) Payment Systems and Quality Reporting Programs final rule (77 FR 68500 through 68507), we adopted a policy that would allow any quality measure adopted for use in the IRF QRP to remain in effect until the measure was actively removed, suspended, or replaced, when we initially adopt a measure for the IRF QRP for a payment determination. For the purpose of streamlining the rulemaking process, when we initially adopt a measure for the IRF QRP for a payment determination, this measure will also be adopted for all subsequent years or until we propose to remove, suspend, or replace the measure. For further information on how measures are considered for removal, suspension, or replacement, please refer to the CY 2013 OPPS/ASC final rule (77 FR 68500).
We are not proposing any changes to the policy for retaining IRF QRP measures adopted for previous payment determinations.
In the CY 2013 OPPS/ASC final rule (77 FR 68500 through 68507), we adopted a subregulatory process to incorporate NQF updates to IRF quality measure specifications that do not substantively change the nature of the measure. Substantive changes will be proposed and finalized through rulemaking. For further information on what constitutes a substantive versus a nonsubstantive change and the subregulatory process for nonsubstantive changes, please refer to the CY 2013 OPPS/ASC final rule (77 FR 68500). We are not proposing any changes to the policy for adopting changes to IRF QRP measures.
A history of the IRF QRP quality measures adopted for the FY 2014 payment determinations and subsequent years is presented in Table 7. The year in which each quality measure was first adopted and implemented, and then subsequently re-proposed or revised, if applicable, is displayed. The initial and subsequent annual payment determination years are also shown in Table 7. For more information on a particular measure, please refer to the IRF PPS final rule and associated page numbers referenced in the Table 7.
For the FY 2018 payment determinations and subsequent years, in addition to the quality measures we are retaining under our policy described in section VII.C. of this proposed rule, we are proposing four new measures. Three of these measures proposed were developed to meet the requirements of IMPACT Act. They are:
(1) MSPB-PAC IRF QRP,
(2) Discharge to Community-PAC IRF QRP, and
(3) Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP.
The fourth measure to be proposed is: (4) Potentially Preventable Within Stay Readmission Measure for IRFs. The measures are described in more detail below.
For the risk-adjustment of the resource use and other measures, we understand the important role that sociodemographic status plays in the care of patients. However, we continue to have concerns about holding providers to different standards for the outcomes of their patients of diverse sociodemographic status because we do not want to mask potential disparities or minimize incentives to improve the outcomes of disadvantaged populations. We routinely monitor the impact of sociodemographic status on providers' results on our measures.
The NQF is currently undertaking a two-year trial period in which new measures and measures undergoing maintenance review will be assessed to determine if risk-adjusting for sociodemographic factors is appropriate. For two years, NQF will conduct a trial of temporarily allowing inclusion of sociodemographic factors in the risk-adjustment approach for some performance measures. At the conclusion of the trial, NQF will issue recommendations on future permanent inclusion of sociodemographic factors. During the trial, measure developers are
Furthermore, the Office of the Assistant Secretary for Planning and Evaluation (ASPE) is conducting research to examine the impact of sociodemographic status on quality measures, resource use, and other measures under the Medicare program as directed by the IMPACT Act. We will closely examine the findings of the ASPE reports and related Secretarial recommendations and consider how they apply to our quality programs at such time as they are available.
We are inviting public comment on how socioeconomic and demographic factors should be used in risk adjustment for the resource use measures.
We are proposing an MSPB-PAC IRF QRP measure for inclusion in the IRF QRP for the FY 2018 payment determination and subsequent years. Section 1899B(d)(1)(A) of the Act requires the Secretary to specify resource use measures, including total estimated MSPB, on which PAC providers consisting of Skilled Nursing Facilities (SNFs), IRFs, Long-Term Care Hospitals (LTCHs), and Home Health Agencies (HHAs) are required to submit necessary data specified by the Secretary.
Rising Medicare expenditures for post-acute care as well as wide variation in spending for these services underlines the importance of measuring resource use for providers rendering these services. Between 2001 and 2013, Medicare PAC spending grew at an annual rate of 6.1 percent and doubled to $59.4 billion, while payments to inpatient hospitals grew at an annual rate of 1.7 percent over this same period.
We reviewed the NQF's consensus-endorsed measures and were unable to identify any NQF-endorsed resource use measures for PAC settings. As such, we are proposing this MSPB-PAC IRF measure under the Secretary's authority to specify non-NQF-endorsed measures under section 1899B(e)(2)(B). Given the current lack of resource use measures for PAC settings, our proposed MSPB-PAC IRF QRP measure has the potential to provide valuable information to IRF providers on their relative Medicare spending in delivering services to approximately 338,000 Medicare beneficiaries.
The proposed MSPB-PAC IRF episode-based measure will provide actionable and transparent information to support IRF providers' efforts to promote care coordination and deliver high quality care at a lower cost to Medicare. The MSPB-PAC IRF QRP measure holds IRF providers accountable for the Medicare payments within an “episode of care” (episode), which includes the period during which a patient is directly under the IRF's care, as well as a defined period after the end of the IRF treatment, which may be reflective of and influenced by the services furnished by the IRF. MSPB-PAC IRF QRP episodes, constructed according to the methodology described below, have high levels of Medicare spending with substantial variation. In FY 2013 and FY 2014, Medicare FFS beneficiaries experienced 613,089 MSPB-PAC IRF QPR episodes triggered by admission to an IRF. The mean payment-standardized, risk-adjusted episode spending for these episodes is $30,370. There is substantial variation in the Medicare payments for these MSPB-PAC IRF QRP episodes—ranging from approximately $15,059 at the 5th percentile to approximately $55,912 at the 95th percentile. This variation is partially driven by variation in payments occurring following IRF treatment.
Evaluating Medicare payments during an episode creates a continuum of accountability between providers and has the potential to improve post-treatment care planning and coordination. While some stakeholders throughout the measure development process supported the measures and believe that measuring Medicare spending was critical for improving efficiency, others believed that resource use measures did not reflect quality of care in that they do not take into account patient outcomes or experience beyond those observable in claims data. However, IRFs involved in the provision of high quality PAC care as well as appropriate discharge planning and post-discharge care coordination would be expected to perform well on this measure since beneficiaries would likely experience fewer costly adverse events (for example, avoidable hospitalizations, infections, and emergency room usage). Further, it is important that the cost of care be explicitly measured so that, in conjunction with other quality measures, we can recognize providers that are involved in the provision of high quality care at lower cost.
We have undertaken development of MSPB-PAC measures for each of the four PAC settings. We are proposing an LTCH-specific MSPB-PAC measure in the FY 2017 IPPS/LTCH proposed rule published elsewhere in this issue of the
The MSPB-PAC measures mirror the general construction of the inpatient prospective payment system (IPPS) hospital MSPB measure that was finalized in the FY 2012 IPPS/LTCH PPS Final Rule (76 FR 51618 through 51627). It was endorsed by the NQF on December 6, 2013, and has been used in the Hospital Value-Based Purchasing (VBP) Program (NQF #2158) since FY 2015.
MSPB-PAC episodes may begin within 30 days of discharge from an inpatient hospital as part of a patient's trajectory from an acute to a PAC setting. An IRF stay beginning within 30 days of discharge from an inpatient hospital will be included once in the hospital's MSPB measure, and once in the IRF provider's MSPB-PAC measure. Aligning the hospital MSPB and MSPB-PAC measures in this way creates continuous accountability and aligns incentives to improve care planning and coordination across inpatient and PAC settings.
We have sought and considered the input of stakeholders throughout the measure development process for the MSPB-PAC measures. We convened a TEP consisting of 12 panelists with combined expertise in all of the PAC settings on October 29 and 30, 2015 in Baltimore, Maryland. A follow-up email survey was sent to TEP members on November 18, 2015 to which 7 responses were received by December 8, 2015. The MSPB-PAC TEP Summary Report is available at
Since the MAP's review and recommendation of continued development, we have continued to refine risk adjustment models and conduct measure testing for the IMPACT Act measures in compliance with the MAP's recommendations. The proposed IMPACT Act measures are both consistent with the information submitted to the MAP and support the scientific acceptability of these measures for use in quality reporting programs.
In addition, a public comment period, accompanied by draft measures specifications, was originally open from January 13 to 27, 2016 and twice extended to January 29 and February 5. A total of 45 comments on the MSPB-PAC measures were received during this 3.5 week period. Also, the comments received covered each of the MAP's concerns as outlined in their Final Recommendations.
To calculate the MSPB-PAC IRF QRP measure for each IRF provider, we first define the construction of the MSPB-PAC IRF QRP episode, including the length of the episode window as well as the services included in the episode. Next, we apply the methodology for the measure calculation. The specifications are discussed further below. More detailed specifications for the proposed MSPB-PAC measures, including the MSPB-PAC IRF QRP measure in this proposed rule, are available at
An MSPB-PAC IRF QRP episode begins at the episode trigger, which is defined as the patient's admission to an IRF. This admitting facility is the attributed provider, for whom the MSPB-PAC IRF QRP measure is calculated. The episode window is the time period during which Medicare FFS Part A and Part B services are counted towards the MSPB-PAC IRF QRP episode. Because Medicare FFS claims are already reported to the Medicare program for payment purposes, IRF providers will not be required to report any additional data to CMS for calculation of this measure. Thus, there will be no additional data collection burden from the implementation of this measure.
The episode window is comprised of a treatment period and an associated services period. The treatment period begins at the trigger (that is, on the day
An MSPB-PAC episode may begin during the associated services period of an MSPB-PAC IRF QRP episode in the 30 days post-treatment. One possible scenario occurs where an IRF provider discharges a beneficiary who is then admitted to a HHA within 30 days. The HHA claim would be included once as an associated service for the attributed provider of the first MSPB-PAC IRF QRP episode and once as a treatment service for the attributed provider of the second MSPB-PAC HHA episode. As in the case of overlap between hospital and PAC episodes discussed earlier, this overlap is necessary to ensure continuous accountability between providers throughout a beneficiary's trajectory of care, as both providers share incentives to deliver high quality care at a lower cost to Medicare. Even within the IRF setting, one MSPB-PAC IRF QRP episode may begin in the associated services period of another MSPB-PAC IRF QRP episode in the 30 days post-treatment. The second IRF claim would be included once as an associated service for the attributed IRF provider of the first MSPB-PAC IRF QRP episode and once as a treatment service for the attributed IRF provider of the second MSPB-PAC IRF QRP episode. Again, this ensures that IRF providers have the same incentives throughout both MSPB-PAC IRF QRP episodes to deliver quality care and engage in patient-focused care planning and coordination. If the second MSPB-PAC IRF QRP episode were excluded from the second IRF provider's MSPB-PAC IRF QRP measure, that provider would not share the same incentives as the first IRF provider of the first MSPB-PAC IRF QRP episode. The MSPB-PAC IRF QRP measure is designed to benchmark the resource use of each attributed provider against what their spending is expected to be as predicted through risk adjustment. As discussed further below, the measure takes the ratio of observed spending to expected spending for each episode and then takes the average of those ratios across all of the attributed provider's episodes. The measure is not a simple sum of all costs across a provider's episodes, thus mitigating concerns about double counting.
Medicare payments for Part A and Part B claims for services included in MSPB-PAC IRF QRP episodes, defined according to the methodology previously discussed, are used to calculate the MSPB-PAC IRF QRP measure. Measure calculation involves determination of the episode exclusions, the approach for standardizing payments for geographic payment differences, the methodology for risk adjustment of episode spending to account for differences in patient case mix, and the specifications for the measure numerator and denominator.
In addition to service-level exclusions that remove some payments from individual episodes, we exclude certain episodes in their entirety from the MSPB-PAC IRF QRP measure to ensure that the MSPB-PAC IRF QRP measure accurately reflects resource use and facilitates fair and meaningful comparisons between IRF providers. The proposed episode-level exclusions are as follows:
• Any episode that is triggered by an IRF claim outside the 50 states, DC, Puerto Rico, and U.S. territories.
• Any episode where the claim(s) constituting the attributed IRF provider's treatment have a standard allowed amount of zero or where the standard allowed amount cannot be calculated.
• Any episode in which a beneficiary is not enrolled in Medicare FFS for the entirety of a 90-day lookback period (that is, a 90-day period prior to the episode trigger) plus episode window (including where a beneficiary dies), or is enrolled in Part C for any part of the lookback period plus episode window.
• Any episode in which a beneficiary has a primary payer other than Medicare for any part of the 90-day lookback period plus episode window.
• Any episode where the claim(s) constituting the attributed IRF provider's treatment include at least one related condition code indicating that it is not a prospective payment system bill.
Section 1899B(d)(2)(C) of the Act requires that the MSPB-PAC measures are adjusted for the factors described under section 1886(o)(2)(B)(ii) of the Act, which include adjustment for factors such as age, sex, race, severity of illness, and other factors that the Secretary determines appropriate. Medicare payments included in the MSPB-PAC IRF QRP measure are payment-standardized and risk-adjusted. Payment standardization removes sources of payment variation not directly related to clinical decisions and facilitates comparisons of resource use across geographic areas. We propose to use the same payment standardization methodology as that used in the NQF-endorsed hospital MSPB measure. This methodology removes geographic payment differences, such as wage index and geographic practice cost index (GPCI), incentive payment adjustments, and other add-on payments that support broader Medicare program goals including indirect graduate medical education (IME) and hospitals serving a
Risk adjustment uses patient claims history to account for case-mix variation and other factors that affect resource use but are beyond the influence of the attributed IRF provider. To assist with risk adjustment for MSPB-PAC IRF QRP episodes, we create mutually exclusive and exhaustive clinical case mix categories using the most recent institutional claim in the 60 days prior to the start of the MSPB-PAC IRF QRP episode. The beneficiaries in these clinical case mix categories have a greater degree of clinical similarity than the overall IRF patient population, and allow us to more accurately estimate Medicare spending. Our proposed MSPB-PAC IRF QRP model, adapted for the IRF setting from the NQF-endorsed hospital MSPB measure uses a regression framework with a 90-day hierarchical condition category (HCC) lookback period and covariates including the clinical case mix categories, HCC indicators, age brackets, indicators for originally disabled, ESRD enrollment, and long-term care status, and selected interactions of these covariates where sample size and predictive ability make them appropriate. We sought and considered public comment regarding the treatment of hospice services occurring within the MSPB-PAC IRF QRP episode window. Given the comments received, we propose to include the Medicare spending for hospice services but risk adjust for them, such that MSPB-PAC IRF QRP episodes with hospice are compared to a benchmark reflecting other MSPB-PAC IRF QRP episodes with hospice. We believe that this provides a balance between the measure's intent of evaluating Medicare spending and ensuring that providers do not have incentives against the appropriate use of hospice services in a patient-centered continuum of care.
We are proposing to use RICs in response to commenters' concerns about the risk adjustment approach for the MSPB-PAC IRF QRP measure. Commenters suggested the use of case mix groups (CMGs); however, we believe that the use of RICs may be more appropriate given that the other covariates incorporated in the model partially account for factors in CMGs (for example, age and certain HCC indicators). RICs do not account for functional status as CMGs do, as the functional status information in CMGs is based on the IRF-PAI. Given the move toward standardized data that was mandated by the IMPACT Act, we have chosen to defer risk adjustment for functional status until standardized data become available. We are seeking comment on whether the use of CMGs would still be appropriate to include in the MSPB-PAC IRF QRP risk adjustment model.
We understand the important role that sociodemographic factors, beyond age, play in the care of patients. However, we continue to have concerns about holding providers to different standards for the outcomes of their patients of diverse sociodemographic status because we do not want to mask potential disparities or minimize incentives to improve the outcomes of disadvantaged populations. We routinely monitor the impact of sociodemographic status on providers' results on our measures.
The NQF is currently undertaking a two-year trial period in which new measures and measures undergoing maintenance review will be assessed to determine if risk-adjusting for sociodemographic factors is appropriate. For two years, NQF will conduct a trial of temporarily allowing inclusion of sociodemographic factors in the risk-adjustment approach for some performance measures. At the conclusion of the trial, NQF will issue recommendations on future permanent inclusion of sociodemographic factors. During the trial, measure developers are expected to submit information such as analyses and interpretations as well as performance scores with and without sociodemographic factors in the risk adjustment model.
Furthermore, ASPE is conducting research to examine the impact of sociodemographic status on quality measures, resource use, and other measures under the Medicare program as required under the IMPACT Act. We will closely examine the findings of the ASPE reports and related Secretarial recommendations and consider how they apply to our quality programs at such time as they are available.
While we conducted analyses on the impact of age by sex on the performance of the MSPB-PAC IRF QRP risk-adjustment model, we are not proposing to adjust the MSPB-PAC IRF QRP measure for socioeconomic and demographic factors at this time. As this MSPB-PAC IRF QRP measure will be submitted for NQF endorsement, we prefer to await the results of this trial and study before deciding whether to risk adjust for socioeconomic and demographic factors. We will monitor the results of the trial, studies, and recommendations. We are inviting public comment on how socioeconomic and demographic factors should be used in risk adjustment for the MSPB-PAC IRF QRP measure.
The MPSB-PAC IRF QRP measure is a payment-standardized, risk-adjusted ratio that compares a given IRF provider's Medicare spending against the Medicare spending of other IRF providers within a performance period. Similar to the hospital MSPB measure, the ratio allows for ease of comparison over time as it obviates the need to adjust for inflation or policy changes.
The MSPB-PAC IRF QRP measure is calculated as the ratio of the MSPB-PAC Amount for each IRF provider divided by the episode-weighted median MSPB-PAC Amount across all IRF providers. To calculate the MSPB-PAC Amount for each IRF provider, one calculates the average of the ratio of the standardized episode spending over the expected episode spending (as predicted in risk adjustment), and then multiplies this quantity by the average episode spending level across all IRF providers nationally. The denominator for an IRF provider's MSPB-PAC IRF QRP measure is the episode-weighted national median of the MSPB-PAC Amounts across all IRF providers. An MSPB-PAC IRF QRP measure of less than 1 indicates that a given IRF provider's Medicare spending is less than that of the national median IRF provider during a performance period. Mathematically, this is represented in equation (A) below:
The MSPB-PAC IRF QRP resource use measure is an administrative claims-based measure. It uses Medicare Part A and Part B claims from FFS beneficiaries and Medicare eligibility files.
The measure cohort includes Medicare FFS beneficiaries with an IRF treatment period ending during the data collection period.
If this proposed measure is finalized, we intend to provide initial confidential feedback to providers, prior to public reporting of this measure, based on Medicare FFS claims data from discharges in CY 2015 and 2016. We intend to publicly report this measure using claims data from discharges in CY 2016 and 2017.
We propose a minimum of 20 episodes for reporting and inclusion in the IRF QRP. For the reliability calculation, as described in the measure specifications identified and for which a link has been provided above, we used two years of data (FY 2013 and FY 2014) to increase the statistical reliability of this measure. The reliability results support the 20 episode case minimum, and 99.74 percent of IRF providers had moderate or high reliability (above 0.4).
We invite public comment on our proposal to adopt the MSPB-PAC IRF QRP measure for the IRF QRP.
Sections 1899B(d)(1)(B) and 1899B(a)(2)(E)(ii) of the Act require the Secretary to specify a measure to address the domain of discharge to community by SNFs, LTCHs, and IRFs by October 1, 2016, and HHAs by January 1, 2017. We are proposing to adopt the measure, Discharge to Community-PAC IRF QRP, for the IRF QRP for the FY 2018 payment determination and subsequent years as a Medicare FFS claims-based measure to meet this requirement.
This proposed measure assesses successful discharge to the community from an IRF setting, with successful discharge to the community including no unplanned rehospitalizations and no death in the 31 days following discharge from the IRF. Specifically, this proposed measure reports an IRF's risk-standardized rate of Medicare FFS patients who are discharged to the community following an IRF stay, and do not have an unplanned readmission to an acute care hospital or LTCH in the 31 days following discharge to community, and who remain alive during the 31 days following discharge to community. The term “community”, for this measure, is defined as home/self-care, with or without home health services, based on Patient Discharge Status Codes 01, 06, 81, and 86 on the Medicare FFS claim.
Discharge to a community setting is an important health care outcome for many patients for whom the overall goals of post-acute care include optimizing functional improvement, returning to a previous level of independence, and avoiding institutionalization. Returning to the community is also an important outcome for many patients who are not expected to make functional improvement during their IRF stay, and for patients who may be expected to decline functionally due to their medical condition. The discharge to community outcome offers a multi-dimensional view of preparation for community life, including the cognitive, physical, and psychosocial elements involved in a discharge to the community.
In addition to being an important outcome from a patient and family perspective, patients discharged to community settings, on average, incur lower costs over the recovery episode, compared with those discharged to institutional settings.
Analyses conducted for ASPE on PAC episodes, using a 5 percent sample of 2006 Medicare claims, revealed that relatively high average, unadjusted Medicare payments are associated with discharge to institutional settings from IRFs, SNFs, LTCHs or HHAs, as compared with payments associated with discharge to community settings.
Measuring and comparing facility-level discharge to community rates is expected to help differentiate among facilities with varying performance in this important domain, and to help avoid disparities in care across patient groups. Variation in discharge to community rates has been reported within and across post-acute settings; across a variety of facility-level characteristics, such as geographic location (for example, regional location, urban or rural location), ownership (for example, for-profit or nonprofit), and freestanding or hospital-based units; and across patient-level characteristics, such as race and gender.
Discharge to community is an actionable health care outcome, as targeted interventions have been shown to successfully increase discharge to community rates in a variety of post-acute settings.
A TEP convened by our measure development contractor was strongly supportive of the importance of measuring discharge to community outcomes, and implementing the proposed measure, Discharge to Community-PAC IRF QRP in the IRF QRP. The panel provided input on the technical specifications of this proposed measure, including the feasibility of implementing the measure, as well as the overall measure reliability and validity. A summary of the TEP proceedings is available on the PAC Quality Initiatives Downloads and Videos Web site at:
We also solicited stakeholder feedback on the development of this measure through a public comment period held from November 9, 2015, through December 8, 2015. Several stakeholders and organizations, including the MedPAC, among others, supported this measure for implementation. The public comment summary report for the proposed measure is available on the CMS Web site at:
The NQF-convened MAP met on December 14 and 15, 2015, and provided input on the use of this proposed Discharge to Community-PAC IRF QRP measure in the IRF QRP. The MAP encouraged continued development of the proposed measure to meet the mandate of the IMPACT Act. The MAP supported the alignment of this proposed measure across PAC settings, using standardized claims data. More information about the MAP's recommendations for this measure is available at:
Since the MAP's review and recommendation of continued development, we have continued to refine risk-adjustment models and conduct measure testing for this measure, as recommended by the MAP. This proposed measure is consistent with the information submitted to the MAP and is scientifically acceptable for current specification in the IRF QRP. As discussed with the MAP, we fully anticipate that additional analyses will continue as we submit this measure to the ongoing measure maintenance process.
We reviewed the NQF's consensus-endorsed measures and were unable to identify any NQF-endorsed resource use or other measures for post-acute care focused on discharge to community. In addition, we are unaware of any other post-acute care measures for discharge to community that have been endorsed or adopted by other consensus organizations. Therefore, we are proposing the measure, Discharge to Community-PAC IRF QRP, under the Secretary's authority to specify non-NQF-endorsed measures under section 1899B(e)(2)(B) of the Act.
We are proposing to use data from the Medicare FFS claims and Medicare eligibility files to calculate this proposed measure. We are proposing to use data from the “Patient Discharge Status Code” on Medicare FFS claims to determine whether a patient was discharged to a community setting for calculation of this proposed measure. In all PAC settings, we tested the accuracy of determining discharge to a community setting using the “Patient Discharge Status Code” on the PAC claim by examining whether discharge to community coding based on PAC claim data agreed with discharge to community coding based on PAC assessment data. We found excellent agreement between the two data sources in all PAC settings, ranging from 94.6 percent to 98.8 percent. Specifically, in the IRF setting, using 2013 data, we found 98.8 percent agreement in coding of community and non-community discharges when comparing discharge status codes on claims and the Discharge to Living Setting (item 44A) codes on the IRF-PAI. We further examined the accuracy of the “Patient Discharge Status Code” on the PAC claim by assessing how frequently discharges to an acute care hospital were confirmed by follow-up acute care claims. We discovered that 88 percent to 91 percent of IRF, LTCH, and SNF claims with acute care discharge status codes were followed by an acute care claim on the day of, or day after, PAC discharge. We believe these data support the use of the claims “Patient Discharge Status Code” for determining discharge to a community setting for this measure. In addition, this measure can feasibly be implemented in the IRF QRP because all data used for measure calculation are derived from Medicare FFS claims and eligibility files, which are already available to CMS.
Based on the evidence discussed above, we are proposing to adopt the measure, Discharge to Community-PAC IRF QRP, for the IRF QRP for FY 2018 payment determination and subsequent years. This proposed measure is calculated using 2 years of data. We are proposing a minimum of 25 eligible stays in a given IRF for public reporting of the proposed measure for that IRF. Since Medicare FFS claims data are already reported to the Medicare program for payment purposes, and Medicare eligibility files are also available, IRFs will not be required to report any additional data to CMS for calculation of this measure. The proposed measure denominator is the risk-adjusted expected number of discharges to community. The proposed measure numerator is the risk-adjusted estimate of the number of patients who are discharged to the community, do not have an unplanned readmission to an acute care hospital or LTCH in the 31-day post-discharge observation window, and who remain alive during the post-discharge observation window. The measure is risk-adjusted for variables such as age and sex, principal diagnosis, comorbidities, ESRD status, and dialysis, among other variables. For technical information about this proposed measure, including information about the measure calculation, risk adjustment, and denominator exclusions, we refer readers to the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 IRF QRP proposed rule, available at:
If this proposed measure is finalized, we intend to provide initial confidential feedback to IRFs, prior to public reporting of this measure, based on
We are inviting public comment on our proposal to adopt the measure, Discharge to Community-PAC IRF QRP, for the IRF QRP.
Sections 1899B(a)(2)(E)(ii) and 1899B(d)(1)(C) of the Act require the Secretary to specify measures to address the domain of all-condition risk-adjusted potentially preventable hospital readmission rates by SNFs, LTCHs, and IRFs by October 1, 2016, and HHAs by January 1, 2017. We are proposing the measure Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP as a Medicare FFS claims-based measure to meet this requirement for the FY 2018 payment determination and subsequent years.
The proposed measure assesses the facility-level risk-standardized rate of unplanned, potentially preventable hospital readmissions for Medicare FFS beneficiaries in the 30 days post IRF discharge. The IRF admission must have occurred within up to 30 days of discharge from a prior proximal hospital stay which is defined as an inpatient admission to an acute care hospital (including IPPS, CAH, or a psychiatric hospital). Hospital readmissions include readmissions to a short-stay acute-care hospital or an LTCH, with a diagnosis considered to be unplanned and potentially preventable. This proposed measure is claims-based, requiring no additional data collection or submission burden for IRFs. Because the measure denominator is based on IRF admissions, each Medicare beneficiary may be included in the measure multiple times within the measurement period. Readmissions counted in this measure are identified by examining Medicare FFS claims data for readmissions to either acute care hospitals (IPPS or CAH) or LTCHs that occur during a 30-day window beginning two days after IRF discharge. This measure is conceptualized uniformly across the PAC settings, in terms of the measure definition, the approach to risk adjustment, and the measure calculation. Our approach for defining potentially preventable hospital readmissions is described in more detail below.
Hospital readmissions among the Medicare population, including beneficiaries that utilize PAC, are common, costly, and often preventable.
We have addressed the high rates of hospital readmissions in the acute care setting as well as in PAC. For example, we developed the following measure: All-Cause Unplanned Readmission Measure for 30 Days Post-Discharge from IRFs (NQF #2502), as well as similar measures for other PAC providers (NQF #2512 for LTCHs and NQF #2510 for SNFs).
Several general methods and algorithms have been developed to assess potentially avoidable or preventable hospitalizations and readmissions for the Medicare population. These include the Agency for Healthcare Research and Quality's (AHRQ's) Prevention Quality Indicators, approaches developed by MedPAC, and proprietary approaches, such as the 3M
• Inadequate management of chronic conditions;
• Inadequate management of infections; and
• Inadequate management of other unplanned events.
Additional details regarding the definition for potentially preventable readmissions are available in the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 IRF QRP proposed rule, available at
This proposed measure focuses on readmissions that are potentially preventable and also unplanned. Similar to the All-Cause Unplanned Readmission Measure for 30 Days Post-Discharge from IRFs (NQF #2502), this proposed measure uses the current version of the CMS Planned Readmission Algorithm as the main component for identifying planned readmissions. A complete description of the CMS Planned Readmission Algorithm, which includes lists of planned diagnoses and procedures, can be found on the CMS Web site at
The proposed measure, Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP, assesses potentially preventable readmission rates while accounting for patient demographics, principal diagnosis in the prior hospital stay, comorbidities, and other patient factors. While estimating the predictive power of patient characteristics, the model also estimates a facility-specific effect, common to patients treated in each facility. This proposed measure is calculated for each IRF based on the ratio of the predicted number of risk-adjusted, unplanned, potentially preventable hospital readmissions that occur within 30 days after an IRF discharge, including the estimated facility effect, to the estimated predicted number of risk-adjusted, unplanned inpatient hospital readmissions for the same patients treated at the average IRF. A ratio above 1.0 indicates a higher than expected readmission rate (worse) while a ratio below 1.0 indicates a lower than expected readmission rate (better). This ratio is referred to as the standardized risk ratio (SRR). The SRR is then multiplied by the overall national raw rate of potentially preventable readmissions for all IRF stays. The resulting rate is the risk-standardized readmission rate (RSRR) of potentially preventable readmissions.
An eligible IRF stay is followed until: (1) The 30-day post-discharge period ends; or (2) the patient is readmitted to an acute care hospital (IPPS or CAH) or LTCH. If the readmission is unplanned and potentially preventable, it is counted as a readmission in the measure calculation. If the readmission is planned, the readmission is not counted in the measure rate.
This measure is risk adjusted. The risk adjustment modeling estimates the effects of patient characteristics, comorbidities, and select health care variables on the probability of readmission. More specifically, the risk-adjustment model for IRFs accounts for demographic characteristics (age, sex, original reason for Medicare entitlement), principal diagnosis during the prior proximal hospital stay, body system specific surgical indicators, IRF case-mix groups which capture motor function, comorbidities, and number of acute care hospitalizations in the preceding 365 days.
The proposed measure is calculated using 2 consecutive calendar years of FFS claims data, to ensure the statistical reliability of this measure for facilities. In addition, we are proposing a minimum of 25 eligible stays for public reporting of the proposed measure.
A TEP convened by our measure contractor provided recommendations on the technical specifications of this proposed measure, including the development of an approach to define potentially preventable hospital readmission for PAC. Details from the TEP meetings, including TEP members' ratings of conditions proposed as being potentially preventable, are available in the TEP summary report available on the CMS Web site at:
The MAP encouraged continued development of the proposed measure. Specifically, the MAP stressed the need to promote shared accountability and ensure effective care transitions. More information about the MAP's recommendations for this measure is available at:
We reviewed the NQF's consensus endorsed measures and were unable to identify any NQF-endorsed measures focused on potentially preventable hospital readmissions. We are unaware of any other measures for this IMPACT Act domain that have been endorsed or adopted by other consensus organizations. Therefore, we are proposing the Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP, under the Secretary's authority to specify non-NQF-endorsed measures under section 1899B(e)(2)(B) of the Act, for the IRF QRP for the FY 2018 payment determination and subsequent years, given the evidence previously discussed above.
We plan to submit the proposed measure to the NQF for consideration of endorsement. If this proposed measure is finalized, we intend to provide initial confidential feedback to providers, prior to public reporting of this proposed measure, based on 2 calendar years of data from discharges in CY 2015 and 2016. We intend to publicly report this proposed measure using data from CY 2016 and 2017.
We are inviting public comment on our proposal to adopt the measure, Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP.
In addition to the measure proposed in section VII.F.3. of the proposed rule, Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP, we are proposing the Potentially Preventable Within Stay Readmission Measure for IRFs for the FY 2018 payment determination and subsequent years. This measure is similar to the Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP; however, the readmission window for this proposed measure focuses on potentially preventable hospital readmissions that take place
Similar to the Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP proposed measure for IRFs, this measure assesses the facility-level risk-standardized rate of unplanned, potentially preventable hospital readmissions during the IRF stay. Hospital readmissions include readmissions to a short-stay acute-care hospital or an LTCH, with a diagnosis considered to be unplanned and potentially preventable. This Medicare FFS measure is claims-based, requiring no additional data collection or submission burden for IRFs.
As described in section VII.F.3. of this proposed rule, we developed the approach for defining PPR measure based on a comprehensive environmental scan, analysis of claims data, and TEP input. Also, we obtained public comment.
The definition for PPRs differs by readmission window. For the within-IRF stay window, PPRs should be avoidable with sufficient medical monitoring and appropriate patient treatment. The list of PPR conditions for the Potentially Preventable Within Stay Readmission Measure for IRFs are categorized by 4 clinical rationale groupings:
• Inadequate management of chronic conditions;
• Inadequate management of infections;
• Inadequate management of other unplanned events; and
• Inadequate injury prevention.
Additional details regarding the definition for PPRs are available in our document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 IRF QRP proposed rule which can be found at
Refer to section VII.F of this proposed rule for the relevant background and details that are also relevant for this measure. This proposed measure defines planned readmissions in the same manner as described in section VII.F.3 of this proposed rule, for the Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP. In addition, similar to the Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP proposed measure, this proposed measure uses the same risk-adjustment and statistical approach as described in section VII.F.3 of this proposed rule. Note the full methodology is detailed in the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 IRF QRP proposed rule, at
A TEP convened by our measure contractor provided recommendations on the technical specifications of this proposed measure, including the development of an approach to define potentially preventable hospital readmission for PAC. Details from the TEP meetings, including TEP members' ratings of conditions proposed as being potentially preventable, are available in the TEP Summary Report available on the CMS Web site at:
The MAP encouraged continued development of the proposed measure. Specifically, the MAP stressed the need to promote shared accountability and ensure effective care transitions. More information about the MAP's recommendations for this measure is available at:
We plan to submit the proposed measure to the NQF for consideration of endorsement. If this proposed measure is finalized, we intend to provide initial confidential feedback to providers, prior to public reporting of this proposed measure, based on 2 calendar years of claims data from discharges in 2015 and 2016. We propose a minimum of 25 eligible stays in a given IRF for public reporting of the proposed measure for that IRF. We intend to publicly report this proposed measure using claims data from calendar years 2016 and 2017.
We are inviting public comment on our proposal to adopt this measure, Potentially Preventable Within Stay Readmission Measure for IRFs.
In addition to the measures we are retaining as described in section VII.E. of this proposed rule under our policy described in section VII.C. of this proposed rule and the new quality measures proposed in section VII.F of this proposed rule for the FY 2018 payment determinations and subsequent years, we are proposing one new quality measure to meet the requirements of the IMPACT Act for the FY 2020 payment determination and subsequent years. The proposed measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, addresses the IMPACT Act quality domain of Medication Reconciliation.
Sections 1899B(a)(2)(E)(i)(III) and 1899B(c)(1)(C) of the Act, as added by the IMPACT Act, require the Secretary to specify a quality measure to address the quality domain of medication reconciliation by October 1, 2018 for IRFs, LTCHs and SNFs by January 1, 2017 for HHAs. We are proposing to adopt the quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues-PAC IRF QRP, for the IRF QRP as a patient-assessment based, cross-setting quality measure to meet the IMPACT Act requirements with data collection beginning October 1, 2018 for the FY 2020 payment determinations and subsequent years.
This proposed measure assesses whether PAC providers were responsive to potential or actual clinically significant medication issue(s) when such issues were identified. Specifically, the proposed quality measure reports the percentage of patient stays in which a drug regimen review was conducted at the time of admission and timely follow-up with a physician occurred each time potential clinically significant medication issues were identified throughout that stay.
For this proposed quality measure, drug regimen review is defined as the review of all medications or drugs the patient is taking to identify any potential clinically significant medication issues. The proposed quality measure utilizes both the processes of medication reconciliation and a drug regimen review, in the event an actual or potential medication issue occurred. The proposed measure informs whether the PAC facility identified and addressed each clinically significant medication issue and if the facility responded or addressed the medication issue in a timely manner. Of note, drug regimen review in PAC settings is generally considered to include medication reconciliation and review of the patient's drug regimen to identify potential clinically significant medication issues.
Medication reconciliation is a process of reviewing an individual's complete and current medication list. Medication reconciliation is a recognized process for reducing the occurrence of medication discrepancies that may lead to Adverse Drug Events (ADEs).
The performance of timely medication reconciliation is valuable to the process of drug regimen review. Preventing and responding to ADEs is of critical importance as ADEs account for significant increases in health services utilization and costs
Medication errors include the duplication of medications, delivery of an incorrect drug, inappropriate drug omissions, or errors in the dosage, route, frequency, and duration of medications.
There is strong evidence that medication discrepancies occur during transfers from acute care facilities to post-acute care facilities. Discrepancies occur when there is conflicting information documented in the medial records. Almost one-third of medication discrepancies have the potential to cause patient harm.
Medication reconciliation has been identified as an area for improvement during transfer from the acute care facility to the receiving post-acute care facility. PAC facilities report gaps in medication information between the acute care hospital and the receiving post-acute-care setting when performing medication reconciliation.
A TEP convened by our measure development contractor provided input on the technical specifications of this proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, including components of reliability, validity, and the feasibility of implementing the measure across PAC settings. The TEP supported the measure's implementation across PAC settings and was supportive of our plans to standardize this measure for cross-setting development. A summary of the TEP proceedings is available on the PAC Quality Initiatives Downloads and Video Web site at
We solicited stakeholder feedback on the development of this measure by means of a public comment period held from September 18 through October 6, 2015. Through public comments submitted by several stakeholders and organizations, we received support for implementation of this proposed measure. The public comment summary report for the proposed measure is available on the CMS Web site at:
The NQF-convened MAP met on December 14 and 15, 2015, and provided input on the use of this proposed measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP. The MAP encouraged continued development of the proposed quality measure to meet the mandate added by the IMPACT Act. The MAP agreed with the measure gaps identified by CMS, including medication reconciliation, and stressed that medication reconciliation be present as an ongoing process. More information about the MAPs recommendations for this measure is available at:
Since the MAP's review and recommendation of continued development, we have continued to refine this proposed measure in compliance with the MAP's recommendations. The proposed measure is both consistent with the information submitted to the MAP and support its scientific acceptability for use in quality reporting programs. Therefore, we are proposing this measure for implementation in the IRF QRP as required by the IMPACT Act.
We reviewed the NQF's endorsed measures and identified one NQF-endorsed cross-setting and quality measure related to medication reconciliation, which applies to the SNF, LTCH, IRF, and HHA settings of care: Care for Older Adults (COA), (NQF #0553). The quality measure, Care for Older Adults (COA), (NQF #0553) assesses the percentage of adults 66 years and older who had a medication review. The Care for Older Adults (COA), (NQF #0553) measure requires at least one medication review conducted by a prescribing practitioner or clinical pharmacist during the measurement year and the presence of a medication list in the medical record. This is in contrast to the proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, which reports the percentage of patient stays in which a drug regimen review was conducted at the time of admission and that timely follow-up with a physician occurred each time one or more potential clinically significant medication issues were identified throughout that stay.
After careful review of both quality measures, we have decided to propose the quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP for the following reasons:
• The IMPACT Act requires the implementation of quality measures, using patient assessment data that are standardized and interoperable across PAC settings. The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, employs three standardized patient-assessment data elements for each of the four PAC settings so that data are standardized, interoperable, and comparable; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure does not contain data elements that are standardized across all four PAC settings.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, requires the identification of potential clinically significant medication issues at the beginning, during, and at the end of the patient's stay to capture data on each patient's complete PAC stay; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure only requires annual documentation in the form of a medication list in the medical record of the target population.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, includes identification of the potential clinically significant medication issues and communication with the physician (or physician designee) as well as resolution of the issue(s) within a rapid timeframe (by midnight of the next calendar day); whereas, the Care for Older Adults (COA), (NQF #0553) quality measure does not include any follow-up or timeframe in which the follow-up would need to occur.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, does not have age exclusions; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure limits the measure's population to patients aged 66 and older.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, would be reported to IRFs quarterly to facilitate internal quality monitoring and quality improvement in areas such as patient safety, care coordination, and patient satisfaction; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure would not enable quarterly quality updates, and thus data comparisons within and across PAC providers would be difficult due to the limited data and scope of the data collected.
Therefore, based on the evidence discussed above, we are proposing to adopt the quality measure entitled, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, for the IRF QRP for FY 2020 payment determination and subsequent years. We plan to submit the quality measure to the NQF for consideration for endorsement.
The calculation of the proposed quality measure would be based on the data collection of three standardized items to be included in the IRF-PAI. The collection of data by means of the standardized items would be obtained at admission and discharge. For more information about the data submission required for this proposed measure, we refer readers to section VII.I.c of this proposed rule.
The standardized items used to calculate this proposed quality measure do not duplicate existing items currently used for data collection within the IRF-PAI. The proposed measure denominator is the number of patient stays with a discharge assessment during the reporting period. The proposed measure numerator is the number of stays in the denominator where the medical record contains documentation of a drug regimen review conducted at: (1) Admission and (2) discharge with a lookback through the entire patient stay with all potential clinically significant medication issues identified during the course of care and followed up with a physician or physician designee by midnight of the next calendar day. This measure is not risk adjusted. For technical information about this proposed measure, including information about the measure calculation and discussion pertaining to the standardized items used to calculate this measure, we refer readers to the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 IRF QRP proposed rule available at
Data for the proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, would be collected using the IRF-PAI with submission through the Quality Improvement Evaluation System (QIES) Assessment Submission and Processing (ASAP) system.
We invite public comment on our proposal to adopt the quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP for the IRF QRP.
We invite comment on the importance, relevance, appropriateness, and applicability of each of the quality measures listed in Table 8 for future years in the IRF QRP. We are developing a measure related to the IMPACT Act domain, “Accurately communicating the existence of and providing for the transfer of health information and care preferences of an individual to the individual, family caregiver of the individual, and providers of services furnishing items and services to the individual, when the individual transitions.” We are considering the
Section 1886(j)(7)(C) of the Act requires that, for the FY 2014 payment determination and subsequent years, each IRF submit to the Secretary data on quality measures specified by the Secretary. In addition, section 1886(j)(7)(F) of the Act requires that, for the fiscal year beginning on the specified application date, as defined in section 1899B(a)(2)(E) of the Act, and each subsequent year, each IRF submit to the Secretary data on measures specified by the Secretary under section 1899B of the Act. The data required under section 1886(j)(7)(C) and (F) of the Act must be submitted in a form and manner, and at a time, specified by the Secretary. As required by section 1886(j)(7)(A)(i) of the Act, for any IRF that does not submit data in accordance with section 1886(j)(7)(C) and (F) of the Act for a given fiscal year, the annual increase factor for payments for discharges occurring during the fiscal year must be reduced by 2 percentage points.
Tables 9 through 17 represent our finalized data collection and data submission quarterly reporting periods, as well as the quarterly review and correction periods and submission deadlines for the quality measure data submitted via the IRF-PAI and the CDC/NHSN affecting the FY 2018 and subsequent year payment determinations. We also provide in Table 17 our previously finalized claims-based measures for FY 2018 and subsequent years, although we note that, for claims-based measures, there is no corresponding quarterly-based data collection or submission reporting periods with quarterly-based review and correction deadline periods.
Further, in the FY 2016 IRF PPS final rule (80 FR 47122 through 47123), we established that the IRF-PAI-based measures finalized for adoption into the IRF QRP would transition from reporting based on the fiscal year to an annual schedule consistent with the calendar year, with quarterly reporting periods followed by quarterly review and correction periods and submission deadlines, unless there is a clinical reason for an alternative data collection time frame. The pattern for annual, calendar year-based data reporting, in which we use 4 quarters of data, is illustrated in Table 9 and is in place for all Annual Payment Update (APU) years except for the measure in Table 10 for which the FY 2018 APU determination will be based on 5 calendar year quarters in order to transition this measure from FY to CY reporting. We also wish to clarify that payment determinations for the measures finalized for use in the IRF QRP that use the IRF-PAI or CDC NHSN data sources will subsequently use the quarterly data collection/submission and review, correction and submission deadlines described in Table 9 unless otherwise specified, as is with the measure NQF #0680: Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine. For this measure, we clarify in a subsequent discussion that the data collection and reporting periods span two consecutive years from July 1 through June 30th and we therefore separately illustrate those collection/submission quarterly reporting periods and review and correction periods and submission deadlines for FY 2019 and subsequent years in Table 15. We also separately distinguish the reporting periods and data submission timeframes for the finalized measure Influenza Vaccination Coverage among Healthcare Personnel which spans two consecutive years in Table 16.
In the FY 2014 IRF PPS final rule, we adopted the Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (Short Stay) (NQF #0680) measure for the FY 2017 payment determination and subsequent years (78 FR 47910 through 47911). In the FY 2014 IRF PPS final rule (78 FR 47917 through 47919), we finalized the data submission timelines and submission deadlines for the measures for FY 2017 payment determination. Refer to the FY 2014 final rule for a more detailed discussion of these timelines and deadlines.
We would like to clarify that this measure includes all patients in the IRF one or more days during the influenza vaccination season (IVS) (October 1 of any given CY through March 31 of the subsequent CY). This includes, for example, a patient is admitted September 15, 2015, and discharged April 1, 2016 (thus, the patient was in the IRF during the 2015-2016 influenza vaccination season). If a patient's stay did not include one or more days in the IRF during the IVS, IRFs must also complete the influenza items. For example, if a patient was admitted after April 1, 2016, and discharged September 30, 2016, and the patient did not receive the influenza vaccine during the IVS, IRFs should code the reason the patient did not receive the influenza
Further, we wish to clarify that the data submission timeline for this measure includes 4 calendar quarters and is based on the influenza season (July 1 through June 30 of the subsequent year), rather than on the calendar year. For the purposes of APU determination and for public reporting, data calculation and analysis uses data from an influenza vaccination season that is within the
Refer to Table 15 for details about the quarterly data collection/submission and the review and correction deadlines for FY 2019 and subsequent years for NQF #0680 Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine.
We finalized in the FY 2014 IRF PPS final rule (78 FR 47905 through 47906) that for FY 2018 and subsequent years IRFs would submit data on the quality measure Influenza Vaccination Coverage among Healthcare Personnel (NQF #0431) beginning with data submission starting October 1, 2015. To clarify that while the data collected by IRFs for this measure includes vaccination information for a flu vaccination season that begins October 1 (or when the vaccine becomes available) of a given year through March 31 of the subsequent year, the CDC/NHSN system only allows for the submission of the corresponding data any time between October 1 of a given year until March 31 of the subsequent year; however, corrections can be made to such data until May 15th of that year. Quality data for this measure are only required to be submitted once per IVS (Oct 1 through March 31), but must be submitted prior to the May 15 deadline for the year in which the IVS ends; quarterly reporting is not required. For example, for FY 2018 payment determinations, while IRFs can begin immunizing their staff when the vaccine is available throughout the influenza vaccine season which ends on March 31, 2016, IRFs can only begin submitting the data for this measure via the CDC/NHSN system starting on October 1, 2015, and may do so up until May 15 of 2016.
The MSPB PAC IRF QRP measure; Discharge to Community PAC IRF QRP measure; Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP, and Potentially Preventable Within Stay Readmission Measure for IRFs, which we have proposed in this proposed rule, are Medicare FFS claims-based measures. Because claims-based measures can be calculated based on data that are already reported to the Medicare program for payment purposes, no additional information collection will be required from IRFs. As discussed in section VII.F of this proposed rule, these measures will use 2 years of claims-based data beginning with CY 2015 and CY 2016 claims to inform confidential feedback reports for IRFs, and CYs 2016 and 2017 claims data for public reporting,
We invite public comments on this proposal.
As discussed in section VII.F of this proposed rule, we propose that the data for the proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP, affecting FY 2020 payment determination and subsequent years, be collected by completing data elements that would be added to the IRF-PAI with submission through the QIES-ASAP system. Data collection would begin on October 1, 2018. More information on IRF reporting using the QIES-ASAP system is located at the Web site at
For the FY 2020 payment determinations, we propose to collect CY 2018 4th quarter data, that is beginning with discharges on October 1, 2018, through discharges on December 31, 2018, to remain consistent with the usual October release schedule for the IRF-PAI, to give IRFs sufficient time to update their systems so that they can comply with the new data reporting requirements, and to give us sufficient time to determine compliance for the FY 2020 program. The proposed use of 1 quarter of data for the initial year of assessment data reporting in the IRF QRP is consistent with the approach we used previously for the SNF, LTCH, and Hospice QRPs.
Table 18 presents the proposed data collection period and data submission timelines for the new proposed IRF QRP Quality Measure for the FY 2020 Payment Determination. We invite public comments on this proposal.
Following the close of the reporting quarter, October 1, 2018, through December 31, 2018, for the FY 2020 payment determination, IRFs would have the already established additional 4.5 months to correct their quality data and that the final deadline for correcting data for the FY 2020 payment determination would be May 15, 2019 for these measures. We further propose that for the FY 2021 payment determination and subsequent years, we will collect data using the calendar year reporting cycle as described in section VII.I.c of this proposed rule, and illustrated in Table 19. We invite public comments on this proposal.
In the FY 2015 IRF PPS final rule (79 FR 45921 through 45923), we finalized IRF QRP thresholds for completeness of IRF data submissions. To ensure that IRFs are meeting an acceptable standard for completeness of submitted data, we finalized the policy that, beginning with the FY 2016 payment determination and for each subsequent year, IRFs must meet or exceed two separate data completeness thresholds: One threshold set at 95 percent for completion of quality measures data collected using the IRF-PAI submitted through the QIES and a second threshold set at 100 percent for quality measures data collected and submitted using the CDC NHSN.
Additionally, we stated that we will apply the same thresholds to all measures adopted as the IRF QRP expands and IRFs begin reporting data on previously finalized measure sets. That is, as we finalize new measures through the regulatory process, IRFs will be held accountable for meeting the previously finalized data completion threshold requirements for each measure until such time that updated threshold requirements are proposed and finalized through a subsequent regulatory cycle.
Further, we finalized the requirement that an IRF must meet or exceed both thresholds to avoid receiving a 2 percentage point reduction to their annual payment update for a given fiscal year, beginning with FY 2016 and for all subsequent payment updates. For a detailed discussion of the finalized IRF QRP data completion requirements, please refer to the FY 2015 IRF PPS final rule (79 FR 45921 through 45923). We propose to codify the IRF QRP Data Completion Thresholds at § 412.634. We invite public comments on this proposal.
Validation is intended to provide added assurance of the accuracy of the data that will be reported to the public as required by sections 1886(j)(7)(E) and 1899B(g) of the Act. In the FY 2015 IRF PPS rule (79 FR 45923), we finalized, for the FY 2016 adjustments to the IRF PPS annual increase factor and subsequent years, a process to validate the data submitted for quality purposes. However, in the FY 2016 IRF PPS final rule (80 FR 47124), we finalized our decision to temporarily suspend the implementation of this policy. We are not proposing a data validation policy at this time, as we are developing a policy that could be applied to several PAC QRPs. We intend to propose a data validation policy through future rulemaking.
Refer to § 412.634 for requirements pertaining to submission exception and extension for the FY 2017 payment determination and subsequent years. At this time, we are proposing to revise § 412.634 to change the timing for submission of these exception and extension requests from 30 days to 90 days from the date of the qualifying event which is preventing an IRF from submitting their quality data for the IRF QRP. We are proposing the increased time allotted for the submission of the requests from 30 to 90 days to be consistent with other quality reporting programs; for example, the Hospital Inpatient Quality Reporting (IQR) Program is also proposing to extend the deadline to 90 days in section VIII.A.15.a. of the FY 2017 IPPS/LTCH PPS proposed rule published elsewhere in this issue of the
We invite public comments on the proposal to revise § 412.634 to change the timing for submission of these exception and extension requests from 30 days to 90 days from the date of the qualifying event which is preventing an IRF from submitting their quality data for the IRF QRP.
Refer to § 412.634 for a summary of our finalized reconsideration and appeals procedures for the IRF QRP for FY 2017 payment determination and subsequent years. We are not proposing any changes to this policy. However, we wish to clarify that in order to notify IRFs found to be non-compliant with the reporting requirements set forth for a given payment determination, we may include the QIES mechanism in addition to US Mail, and we may elect to utilize the MACs to administer such notifications.
Section 1886(j)(7)(E) of the Act requires the Secretary to establish procedures for making the IRF QRP data
Also, in the FY 2016 IRF PPS final rule (80 FR 47126 through 47127), we also finalized that the display of information for fall 2016 contains performance data on three quality measures:
• Percent of Residents or Patients with Pressure Ulcers That Are New or Worsened (Short Stay) (NQF #0678);
• NHSN CAUTI Outcome Measure (NQF #0138); and
• All-Cause Unplanned Readmission Measure for 30 Days Post-Discharge from IRFs (NQF #2502).
The measures Percent of Residents or Patients with Pressure Ulcers That Are New or Worsened (Short Stay) (NQF #0678) and NHSN CAUTI Outcome Measure (NQF #0138) are based on data collected beginning with the first quarter of 2015 or discharges beginning on January 1, 2015. With the exception of the All-Cause Unplanned Readmission Measure for 30 Days Post-Discharge from IRFs (NQF #2502), rates are displayed based on 4 rolling quarters of data and would initially use discharges from January 1, 2015, through December 31, 2015 (CY 2015) for Percent of Residents or Patients with Pressure Ulcers That Are New or Worsened (Short Stay) (NQF #0678) and data collected from January 1, 2015, through December 31, 2015 (CY 2015) for NHSN CAUTI Outcome Measure (NQF #0138). For the readmissions measure, data will be publicly report beginning with data collected for discharges beginning January 1, 2013, and rates would be displayed based on 2 consecutive years of data. For IRFs with fewer than 25 eligible cases, we propose to assign the IRF to a separate category: “The number of cases is too small (fewer than 25) to reliably tell how well the IRF is performing.” If an IRF has fewer than 25 eligible cases, the IRF's readmission rates and interval estimates will not be publicly reported for the measure.
Calculations for all three measures are discussed in detail in the FY 2016 IRF PPS final rule (80 FR 47126 through 47127).
Pending the availability of data, we are proposing to publicly report data in CY 2017 on 4 additional measures beginning with data collected on these measures for the first quarter of 2015, or discharges beginning on January 1, 2015: (1) Facility-wide Inpatient Hospital-onset Methicillin-resistant Staphylococcus aureus (MRSA) Bacteremia Outcome Measure (NQF #1716) ; (2) Facility-wide Inpatient Hospital-onset Clostridium difficile Infection (CDI) Outcome Measure (NQF #1717) and, beginning with the 2015-16 influenza vaccination season, these two measures; (3) Influenza Vaccination Coverage Among Healthcare Personnel (NQF #0431); and (4) Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (NQF #0680).
Standardized infection ratios (SIRs) for the Facility-wide Inpatient Hospital-onset Methicillin-resistant Staphylococcus aureus (MRSA) Bacteremia Outcome Measure (NQF #1716) and Facility-wide Inpatient Hospital-onset Clostridium difficile Infection (CDI) Outcome Measure (NQF #1717) would be displayed based on 4 rolling quarters of data and would initially use MRSA bacteremia and CDI events that occurred from January 1, 2015 through December 31, 2015 (CY 2015), for calculations. We are proposing that the display of these ratios would be updated quarterly.
Rates for the Influenza Vaccination Coverage Among Healthcare Personnel (NQF #0431) would be displayed for personnel working in the reporting facility October 1, 2015 through March 31, 2016. Rates for the Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (NQF #0680) would be displayed for patients in the IRF during the influenza vaccination season, from October 1, 2015, through March 31, 2016. We are proposing that the display of these rates would be updated annually for subsequent influenza vaccination seasons.
Calculations for the MRSA and CDI Healthcare Associated Infection (HAI) measures adjust for differences in the characteristics of hospitals and patients using a SIR. The SIR is a summary measure that takes into account differences in the types of patients that a hospital treats. For a more detailed discussion of the SIR, please refer to the FY 2016 IRF PPS final rule (80 FR 47126 through 47127). The MRSA and CDI SIRs may take into account the laboratory methods, bed size of the hospital, and other facility-level factors. It compares the actual number of HAIs in a facility or state to a national benchmark based on previous years of reported data and adjusts the data based on several factors. A confidence interval with a lower and upper limit is displayed around each SIR to indicate that there is a high degree of confidence that the true value of the SIR lies within that interval. A SIR with a lower limit that is greater than 1.0 means that there were more HAIs in a facility or state than were predicted, and the facility is classified as “Worse than the U.S. National Benchmark.” If the SIR has an upper limit that is less than 1, the facility had fewer HAIs than were predicted and is classified as “Better than the U.S. National Benchmark.” If the confidence interval includes the value of 1, there is no statistical difference between the actual number of HAIs and the number predicted, and the facility is classified as “No Different than U.S. National Benchmark.” If the number of predicted infections is less than 1.0, the SIR and confidence interval are not calculated by CDC.
Calculations for the Influenza Vaccination Coverage Among Healthcare Personnel (NQF #0431) are based on reported numbers of personnel who received an influenza vaccine at the reporting facility or who provided written documentation of influenza vaccination outside the reporting facility. The sum of these two numbers is divided by the total number of personnel working at the facility for at least 1 day from October 1 through March 31 of the following year, and the result is multiplied by 100 to produce a compliance percentage (vaccination coverage). No risk adjustment is applicable to these calculations. More information on these calculations and measure specifications is available at
We are inviting public comment on our proposal to begin publicly reporting in CY 2017 pending the availability of data on Facility-wide Inpatient Hospital-onset Methicillin-resistant Staphylococcus aureus (MRSA) Bacteremia Outcome Measure (NQF #1716); Facility-wide Inpatient Hospital-onset Clostridium difficile Infection (CDI) Outcome Measure (NQF #1716); and Influenza Vaccination Coverage Among Healthcare Personnel (NQF #0431).
For the Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (Short Stay) (NQF #0680), we propose to display rates annually based on the influenza season to avoid reporting for more than one influenza vaccination within a CY. For example, in 2017 we would display rates for the patient vaccination measure based on discharges starting on July 1, 2015, to June 30, 2016. This is proposed because it includes the entire influenza vaccination season (October 1, 2015, to March 31, 2016).
Calculations for Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (Short Stay) (NQF #0680) will be based on patients meeting any one of the following criteria: Patients who received the influenza vaccine during the influenza season, patients who were offered and declined the influenza vaccine, and patients who were ineligible for the influenza vaccine due to contraindication(s). The facility's summary observed score will be calculated by combining the observed counts of all the criteria. This is consistent with the publicly reported patient influenza vaccination measure for Nursing Home Compare. Additionally, for the patient influenza measure, we will exclude IRFs with fewer than 20 stays in the measure denominator. For additional information on the specifications for this measure, please refer to the IRF Quality Reporting Measures Information Web page at
We invite public comments on our proposal to begin publicly reporting the Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (Short Stay) (NQF #0680) measure on discharges from July 1st of the previous calendar year to June 30th of the current calendar year. We invite comments on the public display of the measure Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (NQF #0680) in 2017 pending the availability of data.
Additionally, we are requesting public comments on whether to include, in the future, public display comparison rates based on CMS regions or US census regions for Percent of Residents or Patients with Pressure Ulcers That Are New or Worsened (Short Stay) (NQF #0678); All-Cause Unplanned Readmission Measure for 30 Days Post-Discharge from IRFs (NQF #2502); and Percent of Residents or Patients Who Were Assessed and Appropriately Given the Seasonal Influenza Vaccine (Short Stay) (NQF #0680) for CY 2017 public display.
Section 1899B(g) of the Act requires the Secretary to establish procedures for public reporting of IRFs' performance, including the performance of individual IRFs, on quality measures specified under section 1899B(c)(1) of the Act and resource use and other measures specified under section 1899B(d)(1) of the Act (collectively, IMPACT Act measures) beginning not later than 2 years after the applicable specified application date under section 1899B(a)(2)(E) of the Act. Under section 1899B(g)(2) of the Act, the procedures must ensure, including through a process consistent with the process applied under section 1886(b)(3)(B)(viii)(VII) of the Act, which refers to public display and review requirements in the Hospital IQR Program, that each IRF has the opportunity to review and submit corrections to its data and information that are to be made public prior to the information being made public.
In the FY 2016 IRF PPS final rule (80 FR 47126 through 47128), and as illustrated in Table 9 in section VII.I.a of this proposed rule, we finalized that once the provider has an opportunity to review and correct quarterly data related to measures submitted via the QIES-ASAP system or CDC NHSN, we would consider the provider to have been given the opportunity to review and correct this data. We wish to clarify that although the correction of data (including claims) can occur after the submission deadline, if such corrections are made after a particular quarter's submission and correction deadline, such corrections will not be captured in the file that contains data for calculation of measures for public reporting purposes. To have publicly displayed performance data that is based on accurate underlying data, it will be necessary for IRFs to review and correct this data before the quarterly submission and correction deadline.
In this proposed rule, we are restating and proposing additional details surrounding procedures that would allow individual IRFs to review and correct their data and information on measures that are to be made public before those measure data are made public.
For assessment-based measures, we propose a process by which we would provide each IRF with a confidential feedback report that would allow the IRF to review its performance on such measures and, during a review and correction period, to review and correct the data the IRF submitted to CMS via the CMS QIES-ASAP system for each such measure. In addition, during the review and correction period, the IRF would be able to request correction of any errors in the assessment-based measure rate calculations.
We propose that these confidential feedback reports would be available to each IRF using the CASPER system. We refer to these reports as the IRF Quality Measure (QM) Reports. We propose to provide monthly updates to the data contained in these reports as data become available. We propose to provide the reports so that providers would be able to view their data and information at both the facility and patient level for its quality measures. The CASPER facility level QM Reports may contain information such as the numerator, denominator, facility rate, and national rate. The CASPER patient-level QM Reports may contain individual patient information which will provide information related to which patients were included in the quality measures to identify any potential errors for those measures in which we receive patient-level data. Currently, we do not receive patient-level data on the CDC measure data received via the NHSN system. In addition, we would make other reports available in the CASPER system, such as IRF-PAI assessment data submission reports and provider validation reports, which would disclose the IRFs data submission status providing details on all items submitted for a selected assessment and the status of records submitted. We refer providers to the CDC/NHSN system Web site for information on obtaining reports specific to NHSN submitted data at
As previously finalized in the FY 2016 IRF PPS final rule and illustrated in Table 10 in section VII.I.c of this proposed rule, IRFs would have approximately 4.5 months after the reporting quarter to correct any errors of their assessment-based data (that appear on the CASPER generated QM reports) and NHSN data used to calculate the measures. During the time of data submission for a given quarterly reporting period and up until the quarterly submission deadline, IRFs could review and perform corrections to errors in the assessment data used to calculate the measures and could request correction of measure calculations. However, as already established, once the quarterly submission deadline occurs, the data is “frozen” and calculated for public reporting and providers can no longer submit any corrections. We would encourage IRFs to submit timely assessment data during a given quarterly reporting period and review their data and information early during the review and correction period so that they can identify errors and resubmit data before the data submission deadline.
As noted above, the assessment data would be populated into the confidential feedback reports, and we intend to update the reports monthly with all data that have been submitted and are available. We believe that the data collection/submission quarterly reporting periods plus 4.5 months to review correct and review the data is sufficient time for IRFs to submit, review and, where necessary, correct their data and information. These time frames and deadlines for review and correction of such measures and data satisfy the statutory requirement that IRFs be provided the opportunity to review and correct their data and information and are consistent with the informal process hospitals follow in the Hospital IQR Program.
In FY 2016 IRF PPS final rule (80 FR 47126 through 47128), we finalized the data submission/correction and review period. Also, we afford IRFs a 30-day preview period prior to public display during which IRFs may preview the performance information on their measures that will be made public. We would like to clarify that we will provide the
In addition to assessment-based measures and CDC measure data received via the NHSN system, we have also proposed claims-based measures for the IRF QRP. The claims-based measures include those proposed to meet the requirements of the IMPACT Act as well as the All-Cause Unplanned Readmission Measure for 30 Days Post-Discharge from IRFs (NQF #2502) which was finalized for public display in the FY 2016 IRF PPS final rule (80 FR 47126 through 47127). As noted in section VII.N.2., section 1899B(g)(2) of the Act requires prepublication provider review and correction procedures that are consistent with those followed in the Hospital IQR Program. Under the Hospital IQR Program's informal procedures, for claims-based measures, we provide hospitals 30 days to preview their claims-based measures and data in a preview report containing aggregate hospital-level data. We propose to adopt a similar process for the IRF QRP.
Prior to the public display of our claims-based measures, in alignment with the Hospital IQR, HAC and Hospital VBP Programs, we propose to make available through the CASPER system, a confidential preview report that will contain information pertaining to claims-based measure rate calculations, for example, facility and national rates. The data and information would be for feedback purposes only and could not be corrected. This information would be accompanied by additional confidential information based on the most recent administrative data available at the time we extract the claims data for purposes of calculating the measures. Because the claims-based measures are recalculated on an annual basis, these confidential CASPER QM reports for claims-based measures will be refreshed annually. As previously finalized in the FY 2016 IRF PPS final rule (80 FR 47126 through 47128), IRFs would have 30 days from the date the preview report is made available in which to review this information. The 30-day preview period is the only time when IRFs would be able to see claims-based measures before they are publicly displayed. IRFs would not be able to make corrections to underlying claims data during this preview period, nor would they be able to add new claims to the data extract. However, IRFs may request that we correct our measure calculation if the IRF believes it is incorrect during the 30 day preview period. We propose that if we agree that the measure, as it is displayed in the preview report, contains a calculation error, we could suppress the data on the public reporting Web site, recalculate the measure, and publish it at the time of the next scheduled public display date. This process would be consistent with informal policies followed in the Hospital IQR Program. If finalized, we intend to utilize a subregulatory mechanism, such as our IRF QRP Web site, to explain the process for how and when providers may contest their measure calculations.
The proposed claims-based measures—The MSPB-PAC IRF QRP measure; Discharge to Community—PAC, Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP, and Potentially Preventable Within Stay Readmission Measure for IRFs—use Medicare administrative data from hospitalizations for Medicare FFS beneficiaries. Public reporting of data will be based on 2 consecutive calendar years of data, which is consistent with the specifications of the proposed measures. We propose to create data
We propose that beginning with data that will be publicly displayed in 2018, claims-based measures will be calculated using claims data at least 90 days after the last discharge date in the applicable period, at which time we would create a data extract or snapshot of the available claims data to use for the measures calculation. This timeframe allows us to balance the need to provide timely program information to IRFs with the need to calculate the claims-based measures using as complete a data set as possible. As noted, under this proposed procedure, during the 30-day preview period, IRFs would not be able to submit corrections to the underlying claims data or to add new claims to the data extract. This is for two reasons: First, for certain measures, the claims data used to calculate the measure is derived not from the IRF's claims, but from the claims of another provider. For example, the proposed measure Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP uses claims data submitted by the hospital to which the patient was readmitted. The claims are not those of the IRF and, therefore, the IRF could not make corrections to them. Second, even where the claims used to calculate the measures are those of the IRF, it would not be not possible to correct the data after it is extracted for the measures calculation. This is because it is necessary to take a static “snapshot” of the claims in order to perform the necessary measure calculations.
We seek to have as complete a data set as possible. We recognize that the proposed at least 90-day “run-out” period when we would take the data extract to calculate the claims-based measures is less than the Medicare program's current timely claims filing policy under which providers have up to 1 year from the date of discharge to submit claims. We considered a number of factors in determining that the proposed at least 90-day run-out period is appropriate to calculate the claims-based measures. After the data extract is created, it takes several months to incorporate other data needed for the calculations (particularly in the case of risk-adjusted or episode-based measures). We then need to generate and check the calculations. Because several months lead time is necessary after acquiring the data to generate the claims-based calculations, if we were to delay our data extraction point to 12 months after the last date of the last discharge in the applicable period, we would not be able to deliver the calculations to IRFs sooner than 18 to 24 months after the last discharge. We believe this would create an unacceptably long delay both for IRFs and for us to deliver timely calculations to IRFs for quality improvement.
We invite public comment on these proposals.
Section 1899B(f) of the Act requires the Secretary to provide confidential feedback reports to post-acute care providers on their performance to the measures specified under section 1899B(c)(1) and (d)(1) of the Act, beginning 1 year after the specified application date that applies to such measures and PAC providers. As discussed earlier, the reports we proposed to provide for use by IRFs to review their data and information would be confidential feedback reports that would enable IRFs to review their performance on the measures required under the IRF QRP. We propose that these confidential feedback reports would be available to each IRF using the CASPER system. Data contained within these CASPER reports would be updated as previously described, on a monthly basis as the data become available except for our claims-based measures, which are only updated on an annual basis.
We intend to provide detailed procedures to IRFs on how to obtain their confidential feedback CASPER reports on the IRF QRP Web site at
We seek public comment on this proposal to satisfy the requirement to provide confidential feedback reports to IRFs.
As previously noted, section 1886(j)(7)(A)(i) of the Act requires the application of a 2-percentage point reduction of the applicable market basket increase factor for IRFs that fail to comply with the quality data submission requirements. In compliance with section 1886(j)(7)(A)(i) of the Act, we will apply a 2-percentage point reduction to the applicable FY 2017 market basket increase factor (1.45 percent) in calculating a proposed adjusted FY 2017 standard payment conversion factor to apply to payments for only those IRFs that failed to comply with the data submission requirements. As previously noted, application of the 2-percentage point reduction may result in an update that is less than 0.0 for a fiscal year and in payment rates for a fiscal year being less than such payment rates for the preceding fiscal year. Also, reporting-based reductions to the market basket increase factor will not be cumulative; they will only apply for the FY involved. Table 13 shows the calculation of the proposed adjusted FY 2017 standard payment conversion factor that will be used to compute IRF PPS payment rates for any IRF that failed to meet the quality reporting requirements for the applicable reporting period(s).
We invite public comment on the proposed method for applying the reduction to the FY 2017 IRF increase factor for IRFs that fail to meet the quality reporting requirements.
Under the Paperwork Reduction Act of 1995 (PRA), we are required to provide 60-day notice in the
• The need for the information collection and its usefulness in carrying out the proper functions of our agency.
• The accuracy of our estimate of the information collection burden.
• The quality, utility, and clarity of the information to be collected.
• Recommendations to minimize the information collection burden on the affected public, including automated collection techniques.
This proposed rule makes reference to associated information collections that are not discussed in the regulation text contained in this document.
Failure to submit data required under section 1886(j)(7)(C) and (F) of the Act will result in the reduction of the annual update to the standard federal rate for discharges occurring during such fiscal year by 2 percentage points for any IRF that does not comply with the requirements established by the Secretary. At the time that this analysis was prepared, 91, or approximately 8 percent, of the 1166 active Medicare-certified IRFs did not receive the full annual percentage increase for the FY 2015 annual payment update determination. Information is not available to determine the precise number of IRFs that will not meet the requirements to receive the full annual percentage increase for the FY 2017 payment determination.
We believe that the burden associated with the IRF QRP is the time and effort associated with data collection and reporting. As of February 1, 2016 there are approximately 1131 IRFs currently reporting quality data to CMS. In this proposed rule, we are proposing 5 measures. For the FY 2018 payment determinations and subsequent years, we are proposing four new measures: (1) MSPB-PAC IRF QRP; (2) Discharge to Community-PAC IRF QRP, and (3) Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP; (4) Potentially Preventable 30-Day Within Stay Readmission Measure for IRF QRP. These four measures are Medicare claims-based measures; because claims-based measures can be calculated based on data that are already reported to the Medicare program for payment purposes, we believe there will be no additional impact.
For the FY 2020 payment determination and subsequent years, we are proposing one measure: Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP. Additionally we propose that data for this new measure will be collected and reported using the IRF-PAI (version effective October 1, 2018).
Our burden calculations take into account all “new” items required on the IRF-PAI (version effective October 1, 2018) to support data collection and reporting for this proposed measure. The addition of the new items required to collect the newly proposed measure is for the purpose of achieving standardization of data elements.
We estimate the additional elements for the newly proposed Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP measure will take 6 minutes of nursing/clinical staff time to report data on admission and 4 minutes of nursing/clinical staff time to report data on discharge, for a total of 10 minutes. We estimate that the additional IRF-PAI items we are proposing will be completed by Registered Nurses (RN) for approximately 75 percent of the time required, and Pharmacists for approximately 25 percent of the time required. Individual providers determine the staffing resources necessary. In accordance with OMB control number 0938-0842, we estimate 398,254 discharges from all IRFs annually, with an additional burden of 10 minutes. This would equate to 66,375.67 total hours or 58.69 hours per IRF. We believe this work will be completed by RNs (75 percent) and Pharmacists (25 percent). We obtained mean hourly wages for these staff from the U.S. Bureau of Labor Statistics' May 2014 National Occupational Employment and Wage Estimates(
For the quality reporting during extraordinary circumstances, section VII.M of this proposed rule proposes to add a previously finalized process that IRFs may request an exception or extension from the FY 2019 payment determination and that of subsequent payment determinations. The request must be submitted by email within 90
While the preparation and submission of the request is an information collection, unlike the aforementioned temporary exemption of the data collection requirements for the new drug regimen review measure, the request is not expected to be submitted to OMB for formal review and approval since we estimate less than two requests (total) per year. Since we estimate fewer than 10 respondents annually, the information collection requirement and associated burden is not subject as stated in 5 CFR 1320.3(c) of the implementing regulations of the Paperwork Reduction Act of 1995.
As discussed in section VII.N of this proposed rule, this rule proposes to add a previously finalized process that will enable IRFs to request reconsiderations of our initial non-compliance decision in the event that it believes that it was incorrectly identified as being subject to the 2-percentage point reduction to its annual increase factor due to non-compliance with the IRF QRP reporting requirements. While there is burden associated with filing a reconsideration request, 5 CFR 1320.4 of OMB's implementing regulations for PRA excludes activities during the conduct of administrative actions such as reconsiderations.
If you comment on these information collection and recordkeeping requirements, please submit your comments electronically as specified in the
Because of the large number of public comments we normally receive on
This proposed rule updates the IRF prospective payment rates for FY 2017 as required under section 1886(j)(3)(C) of the Act. It responds to section 1886(j)(5) of the Act, which requires the Secretary to publish in the
This proposed rule also implements sections 1886(j)(3)(C) and (D) of the Act. Section 1886(j)(3)(C)(ii)(I) of the Act requires the Secretary to apply a multi-factor productivity adjustment to the market basket increase factor, and to apply other adjustments as defined by the Act. The productivity adjustment applies to FYs from 2012 forward. The other adjustments apply to FYs 2010 through 2019.
Furthermore, this proposed rule also adopts policy changes under the statutory discretion afforded to the Secretary under section 1886(j)(7) of the Act. Specifically, we propose to revise and update the quality measures and reporting requirements under the IRF quality reporting program.
We have examined the impacts of this proposed rule as required by Executive Order 12866 (September 30, 1993, Regulatory Planning and Review), Executive Order 13563 on Improving Regulation and Regulatory Review (January 18, 2011), the Regulatory Flexibility Act (September 19, 1980, Pub. L. 96-354) (RFA), section 1102(b) of the Act, section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 1999), and the Congressional Review Act (5 U.S.C. 804(2)).
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. A regulatory impact analysis (RIA) must be prepared for a major final rule with economically significant effects ($100 million or more in any 1 year). We estimate the total impact of the policy updates described in this proposed rule by comparing the estimated payments in FY 2017 with those in FY 2016. This analysis results in an estimated $125 million increase for FY 2017 IRF PPS payments. As a result, this proposed rule is designated as economically “significant” under section 3(f)(1) of Executive Order 12866, and hence a major rule under the Congressional Review Act. Also, the rule has been reviewed by OMB.
The Regulatory Flexibility Act (RFA) requires agencies to analyze options for regulatory relief of small entities, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, nonprofit organizations, and small governmental jurisdictions. Most IRFs and most other providers and suppliers are small entities, either by having revenues of $7.5 million to $38.5 million or less in any 1 year depending on industry classification, or by being nonprofit organizations that are not dominant in their markets. (For details, see the Small Business Administration's final rule that set forth size standards for health care industries, at 65 FR 69432 at
In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 604 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of a Metropolitan Statistical Area and has fewer than 100 beds. As discussed in detail below in this section, the rates and policies set forth in this proposed rule will not have a significant impact (not greater than 3 percent) on a substantial number of rural hospitals based on the data of the 140 rural units and 11 rural hospitals in our database of 1,131 IRFs for which data were available.
Section 202 of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-04, enacted on March 22, 1995) also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100 million in 1995 dollars, updated annually for inflation. In 2016, that threshold level is approximately $146 million. This proposed rule will not mandate spending costs on state, local, or tribal governments, in the aggregate, or by the private sector, of greater than $146 million.
Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a final rule that imposes substantial direct requirement costs on state and local governments, preempts state law, or otherwise has federalism implications. As stated, this proposed rule will not have a substantial effect on state and local governments, preempt state law, or otherwise have a federalism implication.
This proposed rule proposes updates to the IRF PPS rates contained in the FY 2016 IRF PPS final rule (80 FR 47036). Specifically, this proposed rule would update the CMG relative weights and average length of stay values, the wage index, and the outlier threshold for high-cost cases. This proposed rule would apply a MFP adjustment to the FY 2017 IRF market basket increase factor in accordance with section 1886(j)(3)(C)(ii)(I) of the Act, and a 0.75 percentage point reduction to the FY 2017 IRF market basket increase factor in accordance with sections 1886(j)(3)(C)(ii)(II) and (D)(v) of the Act. Further, this proposed rule contains proposed revisions to the IRF quality reporting requirements that are expected to result in some additional financial effects on IRFs. In addition, section VII of this proposed rule discusses the implementation of the required 2 percentage point reduction of the market basket increase factor for any IRF that fails to meet the IRF quality reporting requirements, in accordance with section 1886(j)(7) of the Act.
We estimate that the impact of the changes and updates described in this proposed rule will be a net estimated increase of $125 million in payments to IRF providers. This estimate does not include the implementation of the required 2 percentage point reduction of the market basket increase factor for any IRF that fails to meet the IRF quality reporting requirements (as discussed in section X.C.7. of this proposed rule). The impact analysis in Table 21 of this proposed rule represents the projected effects of the updates to IRF PPS payments for FY 2017 compared with the estimated IRF PPS payments in FY 2016. We determine the effects by estimating payments while holding all other payment variables constant. We use the best data available, but we do not attempt to predict behavioral responses to these changes, and we do not make adjustments for future changes in such variables as number of discharges or case-mix.
We note that certain events may combine to limit the scope or accuracy of our impact analysis, because such an analysis is future-oriented and, thus, susceptible to forecasting errors because of other changes in the forecasted impact time period. Some examples could be legislative changes made by the Congress to the Medicare program that would impact program funding, or changes specifically related to IRFs. Although some of these changes may not necessarily be specific to the IRF PPS, the nature of the Medicare program is such that the changes may interact, and the complexity of the interaction of these changes could make it difficult to predict accurately the full scope of the impact upon IRFs.
In updating the rates for FY 2017, we are proposing standard annual revisions described in this proposed rule (for example, the update to the wage and market basket indexes used to adjust the federal rates). We are also implementing a productivity adjustment to the FY 2017 IRF market basket increase factor in accordance with section 1886(j)(3)(C)(ii)(I) of the Act, and a 0.75 percentage point reduction to the FY 2017 IRF market basket increase factor in accordance with sections 1886(j)(3)(C)(ii)(II) and -(D)(v) of the Act. We estimate the total increase in payments to IRFs in FY 2017, relative to FY 2016, will be approximately $125 million.
This estimate is derived from the application of the FY 2017 IRF market basket increase factor, as reduced by a productivity adjustment in accordance with section 1886(j)(3)(C)(ii)(I) of the Act, and a 0.75 percentage point reduction in accordance with sections 1886(j)(3)(C)(ii)(II) and (D)(v) of the Act, which yields an estimated increase in aggregate payments to IRFs of $110 million. Furthermore, there is an additional estimated $15 million increase in aggregate payments to IRFs due to the proposed update to the outlier threshold amount. Outlier payments are estimated to increase from approximately 2.8 percent in FY 2016 to 3.0 percent in FY 2017. Therefore, summed together, we estimate that these updates will result in a net increase in estimated payments of $125 million from FY 2016 to FY 2017.
The effects of the proposed updates that impact IRF PPS payment rates are shown in Table 21. The following proposed updates that affect the IRF PPS payment rates are discussed separately below:
• The effects of the proposed update to the outlier threshold amount, from approximately 2.8 percent to 3.0 percent of total estimated payments for FY 2017, consistent with section 1886(j)(4) of the Act.
• The effects of the proposed annual market basket update (using the IRF market basket) to IRF PPS payment rates, as required by section 1886(j)(3)(A)(i) and sections 1886(j)(3)(C) and (D) of the Act, including a productivity adjustment in accordance with section 1886(j)(3)(C)(i)(I) of the Act, and a 0.75 percentage point reduction in accordance with sections 1886(j)(3)(C)(ii)(II) and (D)(v) of the Act.
• The effects of applying the proposed budget-neutral labor-related share and wage index adjustment, as required under section 1886(j)(6) of the Act.
• The effects of the proposed budget-neutral changes to the CMG relative weights and average length of stay values, under the authority of section 1886(j)(2)(C)(i) of the Act.
• The total change in estimated payments based on the proposed FY 2017 payment changes relative to the estimated FY 2016 payments.
Table 21 categorizes IRFs by geographic location, including urban or rural location, and location for CMS's 9 Census divisions (as defined on the cost report) of the country. In addition, the table divides IRFs into those that are separate rehabilitation hospitals (otherwise called freestanding hospitals in this section), those that are rehabilitation units of a hospital (otherwise called hospital units in this section), rural or urban facilities, ownership (otherwise called for-profit, non-profit, and government), by teaching status, and by disproportionate share patient percentage (DSH PP). The top row of Table 21 shows the overall impact on the 1,131 IRFs included in the analysis.
The next 12 rows of Table 21 contain IRFs categorized according to their geographic location, designation as
The remaining four parts of Table 21 show IRFs grouped by their geographic location within a region, by teaching status, and by DSH PP. First, IRFs located in urban areas are categorized for their location within a particular one of the nine Census geographic regions. Second, IRFs located in rural areas are categorized for their location within a particular one of the nine Census geographic regions. In some cases, especially for rural IRFs located in the New England, Mountain, and Pacific regions, the number of IRFs represented is small. IRFs are then grouped by teaching status, including non-teaching IRFs, IRFs with an intern and resident to average daily census (ADC) ratio less than 10 percent, IRFs with an intern and resident to ADC ratio greater than or equal to 10 percent and less than or equal to 19 percent, and IRFs with an intern and resident to ADC ratio greater than 19 percent. Finally, IRFs are grouped by DSH PP, including IRFs with zero DSH PP, IRFs with a DSH PP less than 5 percent, IRFs with a DSH PP between 5 and less than 10 percent, IRFs with a DSH PP between 10 and 20 percent, and IRFs with a DSH PP greater than 20 percent.
The estimated impacts of each policy described in this proposed rule to the facility categories listed are shown in the columns of Table 21. The description of each column is as follows:
• Column (1) shows the facility classification categories.
• Column (2) shows the number of IRFs in each category in our FY 2016 analysis file.
• Column (3) shows the number of cases in each category in our FY 2016 analysis file.
• Column (4) shows the estimated effect of the proposed adjustment to the outlier threshold amount.
• Column (5) shows the estimated effect of the proposed update to the IRF labor-related share and wage index, in a budget-neutral manner.
• Column (6) shows the estimated effect of the proposed update to the CMG relative weights and average length of stay values, in a budget-neutral manner.
• Column (7) compares our estimates of the payments per discharge, incorporating all of the proposed policies reflected in this proposed rule for FY 2017 to our estimates of payments per discharge in FY 2016.
The average estimated increase for all IRFs is approximately 1.6 percent. This estimated net increase includes the effects of the proposed IRF market basket increase factor for FY 2017 of 2.7 percent, reduced by a productivity adjustment of 0.5 percentage point in accordance with section 1886(j)(3)(C)(ii)(I) of the Act, and further reduced by 0.75 percentage point in accordance with sections 1886(j)(3)(C)(ii)(II) and (D)(v) of the Act. It also includes the approximate 0.2 percent overall increase in estimated IRF outlier payments from the proposed update to the outlier threshold amount. Since we are making the proposed updates to the IRF wage index and the CMG relative weights in a budget-neutral manner, they will not be expected to affect total estimated IRF payments in the aggregate. However, as described in more detail in each section, they will be expected to affect the estimated distribution of payments among providers.
The estimated effects of the proposed update to the outlier threshold adjustment are presented in column 4 of Table 21. In the FY 2016 IRF PPS final rule (80 FR 47036), we used FY 2014 IRF claims data (the best, most complete data available at that time) to set the outlier threshold amount for FY 2016 so that estimated outlier payments would equal 3 percent of total estimated payments for FY 2016.
For this proposed rule, we are using preliminary FY 2015 IRF claims data, and, based on that preliminary analysis, we estimate that IRF outlier payments as a percentage of total estimated IRF payments would be 2.8 percent in FY 2016. Thus, we propose to adjust the outlier threshold amount in this final rule to set total estimated outlier payments equal to 3 percent of total estimated payments in FY 2017. The estimated change in total IRF payments for FY 2017, therefore, includes an approximate 0.2 percent increase in payments because the estimated outlier portion of total payments is estimated to increase from approximately 2.8 percent to 3 percent.
The impact of this proposed outlier adjustment update (as shown in column 4 of Table 21) is to increase estimated overall payments to IRFs by about 0.2 percent. We estimate the largest increase in payments from the update to the outlier threshold amount to be 0.8 percent for rural IRFs in the Pacific region.
In column 5 of Table 21, we present the effects of the proposed budget-neutral update of the wage index and labor-related share. The proposed changes to the wage index and the labor-related share are discussed together because the wage index is applied to the labor-related share portion of payments, so the proposed changes in the two have a combined effect on payments to providers. As discussed in section V.C. of this proposed rule, we are proposing to keep the labor-related share unchanged from FY 2016 to FY 2017 at 71.0 percent.
In column 6 of Table 21, we present the effects of the proposed budget-neutral update of the CMG relative weights and average length of stay values. In the aggregate, we do not estimate that these proposed updates will affect overall estimated payments of IRFs. However, we do expect these updates to have small distributional effects.
In accordance with section 1886(j)(7) of the Act, we will implement a 2 percentage point reduction in the FY 2018 increase factor for IRFs that have failed to report the required quality reporting data to us during the most recent IRF quality reporting period. In section VII.P of this proposed rule, we discuss the proposed method for applying the 2 percentage point reduction to IRFs that fail to meet the IRF QRP requirements. At the time that this analysis was prepared, 91, or approximately 8 percent, of the 1166 active Medicare-certified IRFs did not receive the full annual percentage increase for the FY 2015 annual payment update determination. Information is not available to determine the precise number of IRFs that will not meet the requirements to receive the full annual percentage increase for the FY 2017 payment determination.
In section VII.L of this proposed rule, we discuss our proposal to suspend the previously finalized data accuracy validation policy for IRFs. While we cannot estimate the increase in the number of IRFs that will meet IRF QRP compliance standards at this time, we believe that this number will increase due to the temporary suspension of this policy. Thus, we estimate that the suspension of this policy will decrease impact on overall IRF payments, by increasing the rate of compliance, in addition to decreasing the cost of the IRF QRP to each IRF provider by approximately $47,320 per IRF, which was the estimated cost to each IRF provider to the implement the previously finalized policy.
In section VII.F of this proposed rule, we are proposing four measures for the FY 2018 payment determinations and subsequent years: (1) MSPB-PAC IRF QRP; (2) Discharge to Community-PAC IRF QRP, and (3) Potentially Preventable 30-Day Post-Discharge Readmission Measure for IRF QRP; (4) Potentially Preventable Within Stay Readmission Measure IRFs. These four measures are Medicare claims-based measures; because claims-based measures can be calculated based on data that are already reported to the Medicare program for payment purposes, we believe there will be no additional impact.
In section VII.G of this proposed rule, we are also proposing to adopt one measure for the FY 2020 payment determination and subsequent years: Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC IRF QRP. Additionally, we propose that data for this measure will be collected and reported using the IRF-PAI (version effective October 1, 2018). While the reporting of data on quality measures is an information collection, we believe that the burden associated with modifications to the IRF-PAI discussed in this proposed rule fall under the PRA exceptions provided in 1899B(m) of the Act because they are required to achieve the standardization of patient assessment data. Section 1899B(m) of the Act provides that the PRA does not apply to section 1899B and the sections referenced in section 1899B(a)(2)(B) of the Act that require modification to achieve the standardization of patient assessment data. The requirement and burden will, however, be submitted to OMB for review and approval when the modifications to the IRF-PAI or other applicable PAC assessment instrument are not used to achieve the standardization of patient assessment data.
The total cost related to the proposed measures is estimated at $4,625.46 per IRF annually, or $5,231,398.17 for all IRFs annually.
We intend to continue to closely monitor the effects of this new quality reporting program on IRF providers and help perpetuate successful reporting outcomes through ongoing stakeholder education, national trainings, IRF provider announcements, Web site postings, CMS Open Door Forums, and general and technical help desks.
The following is a discussion of the alternatives considered for the IRF PPS updates contained in this proposed rule.
Section 1886(j)(3)(C) of the Act requires the Secretary to update the IRF PPS payment rates by an increase factor that reflects changes over time in the prices of an appropriate mix of goods and services included in the covered IRF services Thus, we did not consider alternatives to updating payments using the estimated IRF market basket increase factor for FY 2017. However, as noted previously in this proposed rule, section 1886(j)(3)(C)(ii)(I) of the Act requires the Secretary to apply a productivity adjustment to the market basket increase factor for FY 2017, and sections 1886(j)(3)(C)(ii)(II) and 1886(j)(3)(D)(v) of the Act require the Secretary to apply a 0.75 percentage point reduction to the market basket increase factor for FY 2017. Thus, in accordance with section 1886(j)(3)(C) of the Act, we propose to update the IRF
We considered maintaining the existing CMG relative weights and average length of stay values for FY 2017. However, in light of recently available data and our desire to ensure that the CMG relative weights and average length of stay values are as reflective as possible of recent changes in IRF utilization and case mix, we believe that it is appropriate to propose to update the CMG relative weights and average length of stay values at this time to ensure that IRF PPS payments continue to reflect as accurately as possible the current costs of care in IRFs.
We considered updating facility-level adjustment factors for FY 2017. However, as discussed in more detail in the FY 2015 final rule (79 FR 45872), we believe that freezing the facility-level adjustments at FY 2014 levels for FY 2015 and all subsequent years (unless and until the data indicate that they need to be further updated) will allow us an opportunity to monitor the effects of the substantial changes to the adjustment factors for FY 2014, and will allow IRFs time to adjust to the previous changes.
We considered maintaining the existing outlier threshold amount for FY 2017. However, analysis of updated FY 2015 data indicates that estimated outlier payments would be lower than 3 percent of total estimated payments for FY 2017, by approximately 0.2 percent, unless we updated the outlier threshold amount. Consequently, we propose adjusting the outlier threshold amount in this proposed rule to reflect a 0.2 percent increase thereby setting the total outlier payments equal to 3 percent, instead of 2.8 percent, of aggregate estimated payments in FY 2017.
As required by OMB Circular A-4 (available at
Overall, the estimated payments per discharge for IRFs in FY 2017 are projected to increase by 1.6 percent, compared with the estimated payments in FY 2016, as reflected in column 7 of Table 21.
IRF payments per discharge are estimated to increase by 1.7 percent in urban areas and 0.9 percent in rural areas, compared with estimated FY 2016 payments. Payments per discharge to rehabilitation units are estimated to increase 1.8 percent in urban areas and 1.1 percent in rural areas. Payments per discharge to freestanding rehabilitation hospitals are estimated to increase 1.5 percent in urban areas and decrease 0.1 percent in rural areas.
Overall, IRFs are estimated to experience a net increase in payments as a result of the proposed policies in this proposed rule. The largest payment increase is estimated to be a 2.4 percent increase for urban IRFs located in the Middle Atlantic region.
In accordance with the provisions of Executive Order 12866, this proposed rule was reviewed by the Office of Management and Budget.
Administrative practice and procedure, Health facilities, Medicare, Puerto Rico, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, the Centers for Medicare & Medicaid Services proposes to amend 42 CFR chapter IV as set forth below:
Secs. 1102 and 1871 of the Social Security Act (42 U.S.C. 1302 and 1395hh), sec. 124 of Pub. L. 106-113 (113 Stat. 1501A-332), sec. 1206 of Pub. L. 113-67, and sec. 112 of Pub. L. 113-93.
(c) * * *
(2) An IRF must request an exception or extension within 90 days of the date that the extraordinary circumstances occurred.
(f)
(2) These thresholds will apply to all measures adopted into IRF QRP.
(3) An IRF must meet or exceed both thresholds to avoid receiving a 2 percentage point reduction to their annual payment update for a given fiscal year, beginning with FY 2016 and for all subsequent payment updates.
Centers for Medicare & Medicaid Services (CMS), HHS.
Proposed rule.
This proposed rule would update the payment rates used under the prospective payment system (PPS) for skilled nursing facilities (SNFs) for fiscal year (FY) 2017. In addition, it includes a proposal to specify a potentially preventable readmission measure for the Skilled Nursing Facility Value-Based Purchasing Program (SNF VBP), and other proposals for that program aimed at implementing value-based purchasing for SNFs. Additionally, this proposed rule proposes additional polices and measures in the Skilled Nursing Facility Quality Reporting Program (SNF QRP). This proposed rule also includes an update on the SNF Payment Models Research (PMR) project.
To be assured consideration, comments must be received at one of the addresses provided below, no later than 5 p.m. on June 20, 2016.
In commenting, please refer to file code CMS-1645-P. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission.
You may submit comments in one of four ways (please choose only one of the ways listed):
1.
2.
Please allow sufficient time for mailed comments to be received before the close of the comment period.
3.
4.
(Because access to the interior of the Hubert H. Humphrey Building is not readily available to persons without Federal Government identification, commenters are encouraged to leave their comments in the CMS drop slots located in the main lobby of the building. A stamp-in clock is available for persons wishing to retain a proof of filing by stamping in and retaining an extra copy of the comments being filed.)
If you intend to deliver your comments to the Baltimore address, please call telephone number (410) 786-7195 in advance to schedule your arrival with one of our staff members.
Comments mailed to the addresses indicated as appropriate for hand or courier delivery may be delayed and received after the comment period.
For information on viewing public comments, see the beginning of the
Penny Gershman, (410) 786-6643, for information related to SNF PPS clinical issues.
John Kane, (410) 786-0557, for information related to the development of the payment rates and case-mix indexes.
Kia Sidbury, (410) 786-7816, for information related to the wage index.
Bill Ullman, (410) 786-5667, for information related to level of care determinations, consolidated billing, and general information.
Stephanie Frilling, (410) 786-4507, for information related to skilled nursing facility value-based purchasing.
Charlayne Van, (410) 786-8659, for information related to skilled nursing facility quality reporting.
Comments received timely will also be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document, at the headquarters of the Centers for Medicare & Medicaid Services, 7500 Security Boulevard, Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 a.m. to 4 p.m. To schedule an appointment to view public comments, phone 1-800-743-3951.
As discussed in the FY 2016 SNF PPS final rule (80 FR 46390), tables setting forth the Wage Index for Urban Areas Based on CBSA Labor Market Areas and the Wage Index Based on CBSA Labor Market Areas for Rural Areas are no longer published in the
Readers who experience any problems accessing any of these online SNF PPS wage index tables should contact Kia Sidbury at (410) 786-7816.
To assist readers in referencing sections contained in this document, we are providing the following Table of Contents.
In addition, because of the many terms to which we refer by acronym in this proposed rule, we are listing these abbreviations and their corresponding terms in alphabetical order below:
This proposed rule would update the SNF prospective payment rates for FY 2017 as required under section 1888(e)(4)(E) of the Social Security Act (the Act). It would also respond to section 1888(e)(4)(H) of the Act, which requires the Secretary to provide for publication in the
In accordance with sections 1888(e)(4)(E)(ii)(IV) and 1888(e)(5) of the Act, the federal rates in this proposed rule would reflect an update to the rates that we published in the SNF PPS final rule for FY 2016 (80 FR 46390) which reflects the SNF market basket index, as adjusted by the multifactor productivity (MFP) adjustment for FY 2017. We also propose for the SNF VBP Program to specify a potentially preventable readmission measure, define performance standards, and adopt a scoring methodology, among other policies. We are also proposing to adopt and implement four new quality and resource use measures for the SNF QRP and are proposing new SNF review and correction procedures for performance data that is to be publicly reported as we continue to implement this program and meet the requirements of the IMPACT Act.
As amended by section 4432 of the Balanced Budget Act of 1997 (BBA, Pub. L. 105-33, enacted on August 5, 1997), section 1888(e) of the Act provides for the implementation of a PPS for SNFs. This methodology uses prospective, case-mix adjusted per diem payment rates applicable to all covered SNF services defined in section 1888(e)(2)(A) of the Act. The SNF PPS is effective for cost reporting periods beginning on or after July 1, 1998, and covers all costs of furnishing covered SNF services (routine, ancillary, and capital-related costs) other than costs associated with approved educational activities and bad
Section 215(a) of PAMA added section 1888(g) to the Act requiring the Secretary to specify an all-cause all-condition hospital readmission measure and a resource use measure, an all-condition risk-adjusted potentially preventable hospital readmission measure, for the SNF setting. Additionally, section 215(b) of PAMA added section 1888(h) to the Act requiring the Secretary to implement a VBP program for SNFs. Finally, section 2(a) of the IMPACT Act added section 1899B to the Act that, among other things, requires SNFs to report standardized data for measures in specified quality and resource use domains. In addition, the IMPACT Act added section 1888(e)(6) to the Act, which requires the Secretary to implement a quality reporting program for SNFs, which includes a requirement that SNFs report certain data to receive their full payment under the SNF PPS.
Under sections 1888(e)(1)(A) and 1888(e)(11) of the Act, the SNF PPS included an initial, three-phase transition that blended a facility-specific rate (reflecting the individual facility's historical cost experience) with the federal case-mix adjusted rate. The transition extended through the facility's first 3 cost reporting periods under the PPS, up to and including the one that began in FY 2001. Thus, the SNF PPS is no longer operating under the transition, as all facilities have been paid at the full federal rate effective with cost reporting periods beginning in FY 2002. As we now base payments for SNFs entirely on the adjusted federal per diem rates, we no longer include adjustment factors under the transition related to facility-specific rates for the upcoming FY.
Section 1888(e)(4)(E) of the Act requires the SNF PPS payment rates to be updated annually. The most recent annual update occurred in a final rule that set forth updates to the SNF PPS payment rates for FY 2016 (80 FR 46390, August 4, 2015).
Section 1888(e)(4)(H) of the Act specifies that we provide for publication annually in the
• The unadjusted federal per diem rates to be applied to days of covered SNF services furnished during the upcoming FY.
• The case-mix classification system to be applied for these services during the upcoming FY.
• The factors to be applied in making the area wage adjustment for these services.
Along with other revisions discussed later in this preamble, this proposed rule would provide the required annual updates to the per diem payment rates for SNFs for FY 2017.
Under section 1888(e)(4) of the Act, the SNF PPS uses per diem federal payment rates based on mean SNF costs in a base year (FY 1995) updated for inflation to the first effective period of the PPS. We developed the federal payment rates using allowable costs from hospital-based and freestanding SNF cost reports for reporting periods beginning in FY 1995. The data used in developing the federal rates also incorporated a Part B add-on, which is an estimate of the amounts that, prior to the SNF PPS, would have been payable under Part B for covered SNF services furnished to individuals during the course of a covered Part A stay in a SNF.
In developing the rates for the initial period, we updated costs to the first effective year of the PPS (the 15-month period beginning July 1, 1998) using a SNF market basket index, and then standardized for geographic variations in wages and for the costs of facility differences in case mix. In compiling the database used to compute the federal payment rates, we excluded those providers that received new provider exemptions from the routine cost limits, as well as costs related to payments for exceptions to the routine cost limits. Using the formula that the BBA prescribed, we set the federal rates at a level equal to the weighted mean of freestanding costs plus 50 percent of the difference between the freestanding mean and weighted mean of all SNF costs (hospital-based and freestanding) combined. We computed and applied separately the payment rates for facilities located in urban and rural areas, and adjusted the portion of the federal rate attributable to wage-related costs by a wage index to reflect geographic variations in wages.
Section 1888(e)(5)(A) of the Act requires us to establish a SNF market basket index that reflects changes over time in the prices of an appropriate mix of goods and services included in covered SNF services. Accordingly, we have developed a SNF market basket index that encompasses the most commonly used cost categories for SNF routine services, ancillary services, and capital-related expenses. We use the SNF market basket index, adjusted in the manner described below, to update the federal rates on an annual basis. In the SNF PPS final rule for FY 2014 (78 FR 47939 through 47946), we revised and rebased the market basket, which included updating the base year from FY 2004 to FY 2010.
For the FY 2017 proposed rule, the FY 2010-based SNF market basket growth rate is estimated to be 2.6 percent, which is based on the IHS Global Insight, Inc. (IGI) first quarter 2016 forecast with historical data through fourth quarter 2015. In section III.B.5. of this proposed rule, we discuss the specific application of this adjustment to the forthcoming annual update of the SNF PPS payment rates.
Section 1888(e)(5)(B) of the Act defines the SNF market basket percentage as the percentage change in the SNF market basket index from the midpoint of the previous FY to the midpoint of the current FY. For the federal rates set forth in this proposed rule, we use the percentage change in the SNF market basket index to compute the update factor for FY 2017. This is based on the IGI first quarter 2016 forecast (with historical data through the fourth quarter 2015) of the FY 2017 percentage increase in the FY 2010-based SNF market basket index for routine, ancillary, and capital-related expenses, which is used to compute the update factor in this proposed rule. As discussed in sections III.B.3. and III.B.4. of this proposed rule, this market basket percentage change would be reduced by the applicable forecast error correction (as described in § 413.337(d)(2)) and by the MFP adjustment as required by
As discussed in the June 10, 2003 supplemental proposed rule (68 FR 34768) and finalized in the August 4, 2003, final rule (68 FR 46057 through 46059), § 413.337(d)(2) provides for an adjustment to account for market basket forecast error. The initial adjustment for market basket forecast error applied to the update of the FY 2003 rate for FY 2004, and took into account the cumulative forecast error for the period from FY 2000 through FY 2002, resulting in an increase of 3.26 percent to the FY 2004 update. Subsequent adjustments in succeeding FYs take into account the forecast error from the most recently available FY for which there is final data, and apply the difference between the forecasted and actual change in the market basket when the difference exceeds a specified threshold. We originally used a 0.25 percentage point threshold for this purpose; however, for the reasons specified in the FY 2008 SNF PPS final rule (72 FR 43425, August 3, 2007), we adopted a 0.5 percentage point threshold effective for FY 2008 and subsequent FYs. As we stated in the final rule for FY 2004 that first issued the market basket forecast error adjustment (68 FR 46058, August 4, 2003), the adjustment will reflect both upward and downward adjustments, as appropriate.
For FY 2015 (the most recently available FY for which there is final data), the estimated increase in the market basket index was 2.5 percentage points, while the actual increase for FY 2015 was 2.3 percentage points, resulting in the actual increase being 0.2 percentage point lower than the estimated increase. Accordingly, as the difference between the estimated and actual amount of change in the market basket index does not exceed the 0.5 percentage point threshold, the FY 2017 market basket percentage change of 2.6 percent would be not adjusted to account for the forecast error correction. Table 1 shows the forecasted and actual market basket amounts for FY 2015.
Section 3401(b) of the Affordable Care Act requires that, in FY 2012 (and in subsequent FYs), the market basket percentage under the SNF payment system as described in section 1888(e)(5)(B)(i) of the Act is to be reduced annually by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II) of the Act. Section 1886(b)(3)(B)(xi)(II) of the Act, added by section 3401(a) of the Affordable Care Act, sets forth the definition of this productivity adjustment. The statute defines the productivity adjustment to be equal to the 10-year moving average of changes in annual economy-wide private nonfarm business multi-factor productivity (as projected by the Secretary for the 10-year period ending with the applicable FY, year, cost-reporting period, or other annual period) (the MFP adjustment). The Bureau of Labor Statistics (BLS) is the agency that publishes the official measure of private nonfarm business MFP. We refer readers to the BLS Web site at
MFP is derived by subtracting the contribution of labor and capital inputs growth from output growth. The projections of the components of MFP are currently produced by IGI, a nationally recognized economic forecasting firm with which CMS contracts to forecast the components of the market baskets and MFP. To generate a forecast of MFP, IGI replicates the MFP measure calculated by the BLS, using a series of proxy variables derived from IGI's U.S. macroeconomic models. For a discussion of the MFP projection methodology, we refer readers to the FY 2012 SNF PPS final rule (76 FR 48527 through 48529) and the FY 2016 SNF PPS final rule (80 FR 46395). A complete description of the MFP projection methodology is available on our Web site at
Per section 1888(e)(5)(A) of the Act, the Secretary shall establish a SNF market basket index that reflects changes over time in the prices of an appropriate mix of goods and services included in covered SNF services. Section 1888(e)(5)(B)(ii) of the Act, added by section 3401(b) of the Affordable Care Act, requires that for FY 2012 and each subsequent FY, after determining the market basket percentage described in section 1888(e)(5)(B)(i) of the Act, the Secretary shall reduce such percentage by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II) (which we refer to as the MFP adjustment). Section 1888(e)(5)(B)(ii) of the Act further states that the reduction of the market basket percentage by the MFP adjustment may result in the market basket percentage being less than zero for a FY, and may result in payment rates under section 1888(e) of the Act for a FY being less than such payment rates for the preceding FY. Thus, if the application of the MFP adjustment to the market basket percentage calculated under section 1888(e)(5)(B)(i) of the Act results in an MFP-adjusted market basket percentage that is less than zero, then the annual update to the unadjusted federal per diem rates under section 1888(e)(4)(E)(ii) of the Act would be negative, and such rates would decrease relative to the prior FY.
For the FY 2017 update, the MFP adjustment is calculated as the 10-year moving average of changes in MFP for the period ending September 30, 2017, which is 0.5 percent. Consistent with section 1888(e)(5)(B)(i) of the Act and § 413.337(d)(2) of the regulations, the market basket percentage for FY 2017 for the SNF PPS is based on IGI's first quarter 2016 forecast of the SNF market basket update, which is estimated to be 2.6 percent. In accordance with section
Sections 1888(e)(4)(E)(ii)(IV) and 1888(e)(5)(i) of the Act require that the update factor used to establish the FY 2017 unadjusted federal rates be at a level equal to the market basket index percentage change. Accordingly, we determined the total growth from the average market basket level for the period of October 1, 2015 through September 30, 2016 to the average market basket level for the period of October 1, 2016 through September 30, 2017. This process yields a percentage change in the market basket of 2.6 percent.
As further explained in section III.B.3. of this proposed rule, as applicable, we adjust the market basket percentage change by the forecast error from the most recently available FY for which there is final data and apply this adjustment whenever the difference between the forecasted and actual percentage change in the market basket exceeds a 0.5 percentage point threshold. Since the difference between the forecasted FY 2015 SNF market basket percentage change and the actual FY 2015 SNF market basket percentage change (FY 2015 is the most recently available FY for which there is historical data) did not exceed the 0.5 percentage point threshold, the FY 2017 market basket percentage change of 2.6 percent would not be adjusted by the forecast error correction.
For FY 2017, section 1888(e)(5)(B)(ii) of the Act requires us to reduce the market basket percentage change by the MFP adjustment (the 10-year moving average of changes in MFP for the period ending September 30, 2017) of 0.5 percent, as described in section III.B.4. of this proposed rule. The resulting net SNF market basket update would equal 2.1 percent, or 2.6 percent less the 0.5 percentage point MFP adjustment. We propose that if more recent data become available (for example, a more recent estimate of the FY 2010-based SNF market basket and/or MFP adjustment), we would use such data, if appropriate, to determine the FY 2017 SNF market basket percentage change, labor-related share relative importance, forecast error adjustment, and MFP adjustment in the FY 2017 SNF PPS final rule.
We used the SNF market basket, adjusted as described above, to adjust each per diem component of the federal rates forward to reflect the change in the average prices for FY 2017 from average prices for FY 2016. We would further adjust the rates by a wage index budget neutrality factor, described later in this section. Tables 2 and 3 reflect the updated components of the unadjusted federal rates for FY 2017, prior to adjustment for case-mix.
Under section 1888(e)(4)(G)(i) of the Act, the federal rate also incorporates an adjustment to account for facility case-mix, using a classification system that accounts for the relative resource utilization of different patient types. The statute specifies that the adjustment is to reflect both a resident classification system that the Secretary establishes to account for the relative resource use of different patient types, as well as resident assessment data and other data that the Secretary considers appropriate. In the interim final rule with comment period that initially implemented the SNF PPS (63 FR 26252, May 12, 1998), we developed the RUG-III case-mix classification system, which tied the amount of payment to resident resource use in combination with resident characteristic information. Staff time measurement (STM) studies conducted in 1990, 1995, and 1997 provided information on resource use (time spent by staff members on residents) and resident characteristics that enabled us not only to establish RUG-III, but also to create case-mix indexes (CMIs). The original RUG-III grouper logic was based on clinical data collected in 1990, 1995, and 1997. As discussed in the SNF PPS proposed rule for FY 2010 (74 FR 22208), we subsequently conducted a multi-year data collection and analysis under the Staff Time and Resource Intensity Verification (STRIVE) project to update the case-mix classification system for FY 2011. The resulting Resource Utilization Groups, Version 4 (RUG-IV) case-mix classification system reflected the data collected in 2006-2007 during the STRIVE project, and was finalized in the FY 2010 SNF PPS final rule (74 FR 40288) to take effect in FY 2011 concurrently with an updated new resident assessment instrument, version 3.0 of the Minimum Data Set (MDS 3.0), which collects the clinical data used for case-mix classification under RUG-IV.
We note that case-mix classification is based, in part, on the beneficiary's need for skilled nursing care and therapy services. The case-mix classification system uses clinical data from the MDS to assign a case-mix group to each patient that is then used to calculate a per diem payment under the SNF PPS. As discussed in section IV.A. of this proposed rule, the clinical orientation of the case-mix classification system supports the SNF PPS's use of an administrative presumption that considers a beneficiary's initial case-mix classification to assist in making certain SNF level of care determinations. Further, because the MDS is used as a basis for payment, as well as a clinical assessment, we have provided extensive training on proper coding and the time
In addition, we note that section 511 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA, Pub. L. 108-173) amended section 1888(e)(12) of the Act to provide for a temporary increase of 128 percent in the PPS per diem payment for any SNF residents with Acquired Immune Deficiency Syndrome (AIDS), effective with services furnished on or after October 1, 2004. This special add-on for SNF residents with AIDS was to remain in effect until the Secretary certifies that there is an appropriate adjustment in the case mix to compensate for the increased costs associated with such residents. The add-on for SNF residents with AIDS is also discussed in Program Transmittal #160 (Change Request #3291), issued on April 30, 2004, which is available online at
Under section 1888(e)(4)(H), each update of the payment rates must include the case-mix classification methodology applicable for the upcoming FY. The payment rates set forth in this proposed rule reflect the use of the RUG-IV case-mix classification system from October 1, 2016, through September 30, 2017. We list the proposed case-mix adjusted RUG-IV payment rates, provided separately for urban and rural SNFs, in Tables 4 and 5 with corresponding case-mix values. We use the revised OMB delineations adopted in the FY 2015 SNF PPS final rule (79 FR 45632, 45634) to identify a facility's urban or rural status for the purpose of determining which set of rate tables would apply to the facility. Tables 4 and 5 do not reflect the add-on for SNF residents with AIDS enacted by section 511 of the MMA, which we apply only after making all other adjustments (such as wage index and case-mix).
Section 1888(e)(4)(G)(ii) of the Act requires that we adjust the federal rates to account for differences in area wage levels, using a wage index that the Secretary determines appropriate. Since the inception of the SNF PPS, we have used hospital inpatient wage data in developing a wage index to be applied to SNFs. We propose to continue this practice for FY 2017, as we continue to believe that in the absence of SNF-specific wage data, using the hospital inpatient wage index data is appropriate and reasonable for the SNF PPS. As explained in the update notice for FY 2005 (69 FR 45786), the SNF PPS does not use the hospital area wage index's occupational mix adjustment, as this adjustment serves specifically to define the occupational categories more clearly in a hospital setting; moreover, the collection of the occupational wage data also excludes any wage data related to SNFs. Therefore, we believe that using the updated wage data exclusive of the occupational mix adjustment continues to be appropriate for SNF payments. For FY 2017, the updated wage data are for hospital cost reporting periods beginning on or after October 1, 2012 and before October 1, 2013 (FY 2013 cost report data).
We note that section 315 of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (BIPA, Pub. L. 106-554, enacted on December 21, 2000) authorized us to establish a geographic reclassification procedure that is specific to SNFs, but only after collecting the data necessary to establish a SNF wage index that is based on wage data from nursing homes. However, to date, this has proven to be unfeasible due to the volatility of existing SNF wage data and the significant amount of resources that would be required to improve the quality of that data.
In addition, we propose to continue to use the same methodology discussed in the SNF PPS final rule for FY 2008 (72 FR 43423) to address those geographic areas in which there are no hospitals, and thus, no hospital wage index data on which to base the calculation of the FY 2017 SNF PPS wage index. For rural geographic areas that do not have hospitals, and therefore, lack hospital wage data on which to base an area wage adjustment, we would use the average wage index from all contiguous Core-Based Statistical Areas (CBSAs) as a reasonable proxy. For FY 2017, there are no rural geographic areas that do not have hospitals, and thus, this methodology would not be applied. For rural Puerto Rico, we would not apply this methodology due to the distinct economic circumstances that exist there (for example, due to the close proximity to one another of almost all of Puerto Rico's various urban and non-urban areas, this methodology would produce a wage index for rural Puerto Rico that is higher than that in half of its urban areas); instead, we would continue to use the most recent wage index previously available for that area. For urban areas without specific hospital wage index data, we would use the average wage indexes of all of the urban areas within the state to serve as a reasonable proxy for the wage index of that urban CBSA. For FY 2017, the only urban area without wage index data available is CBSA 25980, Hinesville-Fort Stewart, GA. The proposed wage index applicable to FY 2017 is set forth in Tables A and B available on the CMS Web site at
Once calculated, we would apply the wage index adjustment to the labor-related portion of the federal rate. Each year, we calculate a revised labor-related share, based on the relative importance of labor-related cost categories (that is, those cost categories that are labor-intensive and vary with the local labor market) in the input price index. In the SNF PPS final rule for FY 2014 (78 FR 47944 through 47946), we finalized a proposal to revise the labor-related share to reflect the relative importance of the FY 2010-based SNF market basket cost weights for the following cost categories: Wages and salaries; employee benefits; the labor-related portion of nonmedical professional fees; administrative and facilities support services; all other—labor-related services; and a proportion of capital-related expenses.
We calculate the labor-related relative importance from the SNF market basket, and it approximates the labor-related portion of the total costs after taking into account historical and projected price changes between the base year and FY 2017. The price proxies that move the different cost categories in the market basket do not necessarily change at the same rate, and the relative importance captures these changes. Accordingly, the relative importance figure more closely reflects the cost share weights for FY 2017 than the base year weights from the SNF market basket.
We calculate the labor-related relative importance for FY 2017 in four steps. First, we compute the FY 2017 price index level for the total market basket and each cost category of the market basket. Second, we calculate a ratio for each cost category by dividing the FY 2017 price index level for that cost category by the total market basket price index level. Third, we determine the FY 2017 relative importance for each cost category by multiplying this ratio by the base year (FY 2010) weight. Finally, we add the FY 2017 relative importance for each of the labor-related cost categories (wages and salaries, employee benefits, the labor-related portion of non-medical professional fees, administrative and facilities support services, all other: Labor-related services, and a portion of capital-related expenses) to produce the FY 2017 labor-related relative importance. Table 6 summarizes the proposed updated labor-related share for FY 2017, compared to the labor-related share that was used for the FY 2016 SNF PPS final rule.
Tables 7 and 8 show the RUG-IV case-mix adjusted federal rates by labor-related and non-labor-related components.
Section 1888(e)(4)(G)(ii) of the Act also requires that we apply this wage index in a manner that does not result in aggregate payments under the SNF PPS that are greater or less than would otherwise be made if the wage adjustment had not been made. For FY 2017 (federal rates effective October 1, 2016), we would apply an adjustment to fulfill the budget neutrality requirement. We would meet this requirement by multiplying each of the components of the unadjusted federal rates by a budget neutrality factor equal to the ratio of the weighted average wage adjustment factor for FY 2016 to the weighted average wage adjustment factor for FY 2017. For this calculation, we would use the same FY 2015 claims utilization data for both the numerator and denominator of this ratio. We define the wage adjustment factor used in this calculation as the labor share of the rate component multiplied by the wage index plus the non-labor share of the rate component. The budget neutrality factor for FY 2017 would be 1.0000.
In the SNF PPS final rule for FY 2006 (70 FR 45026, August 4, 2005), we adopted the changes discussed in the OMB Bulletin No. 03-04 (June 6, 2003), available online at
In adopting the CBSA geographic designations, we provided for a one-year transition in FY 2006 with a blended wage index for all providers. For FY 2006, the wage index for each provider consisted of a blend of 50 percent of the FY 2006 MSA-based wage index and 50 percent of the FY 2006 CBSA-based wage index (both using FY 2002 hospital data). We referred to the blended wage index as the FY 2006 SNF PPS transition wage index. As discussed in the SNF PPS final rule for FY 2006 (70 FR 45041), since the expiration of this one-year transition on September 30, 2006, we have used the full CBSA-based wage index values.
Generally, OMB issues major revisions to statistical areas every 10 years, based on the results of the decennial census. In the FY 2015 SNF PPS final rule (79 FR 45644 through 45646), we finalized changes to the SNF PPS wage index based on the newest OMB delineations, as described in OMB Bulletin No. 13-01, beginning in FY
Using the hypothetical SNF XYZ described below, Table 9 shows the adjustments made to the federal per diem rates to compute the provider's actual per diem PPS payment. We derive the Labor and Non-labor columns from Table 7. The wage index used in this example is based on the proposed wage index, which may be found in Table A as referenced above. As illustrated in Table 9, SNF XYZ's total PPS payment would equal $46,782.60.
The establishment of the SNF PPS did not change Medicare's fundamental requirements for SNF coverage. However, because the case-mix classification is based, in part, on the beneficiary's need for skilled nursing care and therapy, we have attempted, where possible, to coordinate claims review procedures with the existing resident assessment process and case-mix classification system discussed in section III.C. of this proposed rule. This approach includes an administrative presumption that utilizes a beneficiary's initial classification in one of the upper 52 RUGs of the 66-group RUG-IV case-mix classification system to assist in making certain SNF level of care determinations.
In accordance with section 1888(e)(4)(H)(ii) of the Act and the regulations at § 413.345, we include in each update of the federal payment rates in the
A beneficiary assigned to any of the lower 14 RUG-IV groups is not automatically classified as either meeting or not meeting the definition, but instead receives an individual level of care determination using the existing administrative criteria. This presumption recognizes the strong likelihood that beneficiaries assigned to one of the upper 52 RUG-IV groups during the immediate post-hospital period require a covered level of care, which would be less likely for those beneficiaries assigned to one of the lower 14 RUG-IV groups.
In the July 30, 1999 final rule (64 FR 41670), we indicated that we would announce any changes to the guidelines for Medicare level of care determinations related to modifications in the case-mix classification structure. In this proposed rule, we would continue to designate the upper 52 RUG-IV groups for purposes of this administrative presumption, consisting of all groups encompassed by the following RUG-IV categories:
• Rehabilitation plus Extensive Services.
• Ultra High Rehabilitation.
• Very High Rehabilitation.
• High Rehabilitation.
• Medium Rehabilitation.
• Low Rehabilitation.
• Extensive Services.
• Special Care High.
• Special Care Low.
• Clinically Complex.
However, we note that this administrative presumption policy does not supersede the SNF's responsibility to ensure that its decisions relating to level of care are appropriate and timely, including a review to confirm that the services prompting the beneficiary's assignment to one of the upper 52 RUG-IV groups (which, in turn, serves to trigger the administrative presumption) are themselves medically necessary. As
Sections 1842(b)(6)(E) and 1862(a)(18) of the Act (as added by section 4432(b) of the BBA) require a SNF to submit consolidated Medicare bills to its Medicare Administrative Contractor for almost all of the services that its residents receive during the course of a covered Part A stay. In addition, section 1862(a)(18) of the Act places the responsibility with the SNF for billing Medicare for physical therapy, occupational therapy, and speech-language pathology services that the resident receives during a noncovered stay. Section 1888(e)(2)(A) of the Act excludes a small list of services from the consolidated billing provision (primarily those services furnished by physicians and certain other types of practitioners), which remain separately billable under Part B when furnished to a SNF's Part A resident. These excluded service categories are discussed in greater detail in section V.B.2. of the May 12, 1998 interim final rule (63 FR 26295 through 26297).
A detailed discussion of the legislative history of the consolidated billing provision is available on the SNF PPS Web site at
As explained in the FY 2001 proposed rule (65 FR 19232), the amendments enacted in section 103 of the BBRA not only identified for exclusion from this provision a number of particular service codes within four specified categories (that is, chemotherapy items, chemotherapy administration services, radioisotope services, and customized prosthetic devices), but also gave the Secretary the authority to designate additional, individual services for exclusion within each of the specified service categories. In the proposed rule for FY 2001, we also noted that the BBRA Conference report (H.R. Rep. No. 106-479 at 854 (1999) (Conf. Rep.)) characterizes the individual services that this legislation targets for exclusion as high-cost, low probability events that could have devastating financial impacts because their costs far exceed the payment SNFs receive under the PPS. According to the conferees, section 103(a) of the BBRA is an attempt to exclude from the PPS certain services and costly items that are provided infrequently in SNFs. By contrast, we noted that the Congress declined to designate for exclusion any of the remaining services within those four categories (thus, leaving all of those services subject to SNF consolidated billing), because they are relatively inexpensive and are furnished routinely in SNFs.
As we further explained in the final rule for FY 2001 (65 FR 46790), and as our longstanding policy, any additional service codes that we might designate for exclusion under our discretionary authority must meet the same statutory criteria used in identifying the original codes excluded from consolidated billing under section 103(a) of the BBRA: They must fall within one of the four service categories specified in the BBRA; and they also must meet the same standards of high cost and low probability in the SNF setting, as discussed in the BBRA Conference report. Accordingly, we characterized this statutory authority to identify additional service codes for exclusion as essentially affording the flexibility to revise the list of excluded codes in response to changes of major significance that may occur over time (for example, the development of new medical technologies or other advances in the state of medical practice) (65 FR 46791). In this proposed rule, we specifically invite public comments identifying HCPCS codes in any of these four service categories (chemotherapy items, chemotherapy administration services, radioisotope services, and customized prosthetic devices) representing recent medical advances that might meet our criteria for exclusion from SNF consolidated billing. We may consider excluding a particular service if it meets our criteria for exclusion as specified above. Commenters should identify in their comments the specific HCPCS code that is associated with the service in question, as well as their rationale for requesting that the identified HCPCS code(s) be excluded.
We note that the original BBRA amendment (as well as the implementing regulations) identified a set of excluded services by means of specifying HCPCS codes that were in effect as of a particular date (in that case, as of July 1, 1999). Identifying the excluded services in this manner made it possible for us to utilize program issuances as the vehicle for accomplishing routine updates of the excluded codes, to reflect any minor revisions that might subsequently occur in the coding system itself (for example, the assignment of a different code number to the same service). Accordingly, in the event that we identify through the current rulemaking cycle any new services that would actually represent a substantive change in the scope of the exclusions from SNF consolidated billing, we would identify these additional excluded services by means of the HCPCS codes that are in effect as of a specific date (in this case, as of October 1, 2016). By making any new exclusions in this manner, we could similarly accomplish routine future updates of these additional codes through the issuance of program instructions.
Section 1883 of the Act permits certain small, rural hospitals to enter into a Medicare swing-bed agreement, under which the hospital can use its beds to provide either acute- or SNF-level care, as needed. For critical access hospitals (CAHs), Part A pays on a reasonable cost basis for SNF-level services furnished under a swing-bed agreement. However, in accordance with section 1888(e)(7) of the Act, these
Accordingly, all non-CAH swing-bed rural hospitals have now come under the SNF PPS. Therefore, all rates and wage indexes outlined in earlier sections of this proposed rule for the SNF PPS also apply to all non-CAH swing-bed rural hospitals. A complete discussion of assessment schedules, the MDS, and the transmission software (RAVEN-SB for Swing Beds) appears in the FY 2002 final rule (66 FR 39562) and in the FY 2010 final rule (74 FR 40288). As finalized in the FY 2010 SNF PPS final rule (74 FR 40356 through 40357), effective October 1, 2010, non-CAH swing-bed rural hospitals are required to complete an MDS 3.0 swing-bed assessment which is limited to the required demographic, payment, and quality items. The latest changes in the MDS for swing-bed rural hospitals appear on the SNF PPS Web site at
Section 215 of the Protecting Access to Medicare Act of 2014 (PAMA) authorizes the SNF VBP Program by adding sections 1888(g) and (h) to the Act. These sections provide structure for the development of the SNF VBP Program, including, among other things, the requirements of only two measures—an all-cause, all-condition hospital readmission measure, which is to be replaced as soon as practicable by an all-condition risk-adjusted potentially preventable hospital readmission measure—and confidential and public reporting requirements for the SNF VBP Program. We began development of the SNF VBP Program in the FY 2016 SNF PPS final rule with, among other things, the adoption of an all-cause, all-condition hospital readmission measure, as required under section 1888(g)(1) of the Act. We will continue the process in this proposed rule with our proposal for an all-condition risk-adjusted potentially preventable hospital readmission measure for SNFs, which the Secretary is required to specify no later than October 1, 2016 under section 1888(g)(2) of the Act. The Act requires that the SNF VBP apply to payments for services furnished on or after October 1, 2018. The SNF VBP Program applies to freestanding SNFs, SNFs affiliated with acute care facilities, and all non-CAH swing-bed rural hospitals. We believe the implementation of the SNF VBP Program is an important step toward transforming how care is paid for, moving increasingly toward rewarding better value, outcomes, and innovations instead of merely volume.
For additional background information on the SNF VBP Program, including an overview of the SNF VBP Report to Congress and a summary of the Program's statutory requirements, we refer readers to the FY 2016 SNF PPS final rule (80 FR 46409 through 46410).
Per the requirement at section 1888(g)(1) of the Act, in the FY 2016 SNF PPS final rule (80 FR 46419), we finalized our proposal to specify the SNF 30-Day All-Cause Readmission Measure (SNFRM) (NQF #2510) as the SNF all-cause, all-condition hospital readmission measure for the SNF VBP Program. The SNFRM assesses the risk-standardized rate of all-cause, all-condition, unplanned inpatient hospital readmissions of Medicare fee-for-service (FFS) SNF patients within 30 days of discharge from an admission to an inpatient prospective payment system (IPPS) hospital, CAH, or psychiatric hospital. The measure is claims-based, requiring no additional data collection or submission burden for SNFs. For additional details on the SNFRM, including our responses to public comments, we refer readers to the FY 2016 SNF PPS final rule (80 FR 46411 through 46419).
We are proposing to specify the SNF 30-Day Potentially Preventable Readmission Measure (SNFPPR) as the SNF all-condition risk-adjusted potentially preventable hospital readmission measure to meet the requirements of section 1888(g)(2) of the Act. This proposed measure assesses the facility-level risk-standardized rate of unplanned, potentially preventable hospital readmissions for SNF patients within 30 days of discharge from a prior admission to an IPPS hospital, CAH, or psychiatric hospital. Hospital readmissions include readmissions to a short-stay acute-care hospital or CAH, with a diagnosis considered to be unplanned and potentially preventable. This proposed measure is claims-based, requiring no additional data collection or submission burden for SNFs.
Hospital readmissions among the Medicare population, including beneficiaries that utilize post-acute care, are common, costly, and often preventable.
We have addressed the high rates of hospital readmissions in the acute care setting, as well as in PAC by developing the SNF 30-Day All-Cause Readmission Measure (NQF #2510), as well as similar measures for other PAC providers (NQF #2502 for IRFs and NQF #2512 for LTCHs).
Several general methods and algorithms have been developed to assess potentially avoidable or preventable hospitalizations and readmissions for the Medicare population. These include the Agency for Healthcare Research and Quality's (AHRQ) Prevention Quality Indicators, approaches developed by MedPAC, and proprietary approaches, such as the 3M
Based on the evidence discussed above and to meet PAMA requirements, we are proposing to specify this measure, entitled, SNF 30-Day Potentially Preventable Readmission Measure (SNFPPR), for the SNF VBP Program. The SNFPPR measure was developed by CMS to harmonize with the NQF-endorsed SNF 30-Day All-Cause Readmission Measure (NQF #2510)
The SNFPPR measure estimates the risk-standardized rate of unplanned, potentially preventable hospital readmissions for Medicare FFS beneficiaries that occur within 30 days of discharge from the prior proximal hospitalization. This is a departure from readmission measures in other PAC settings, such as the two measures proposed in the Inpatient Rehabilitation Facility (IRF) Quality Reporting Program, one of which assesses readmissions that take place during the IRF stay and the other that assesses readmissions within 30 days following discharge from the IRF. The proposed measure here is distinct because section 1888(h)(2) of the Act requires that only a single quality measure be implemented in the SNF VBP program at one time. A purely within-stay measure (that is, a measure that assesses readmission rates only when those readmissions occurred during a SNF stay) would perversely incentivize the premature discharge of residents from SNFs to avoid penalty. Conversely, limiting the measure to readmissions that occur within 30-days post-discharge from the SNF would not capture readmissions that occur during the SNF stay. In order to qualify for this proposed measure, the SNF admission must take place within 1 day of discharge from a prior proximal hospital stay. The prior proximal hospital stay is defined as an inpatient admission to an acute care hospital (including IPPS, CAH, or a psychiatric hospital). Because the measure denominator is based on SNF admissions, a single Medicare beneficiary could be included in the measure multiple times within a given year. Readmissions counted in this measure are identified by examining Medicare FFS claims data for readmissions to either acute care hospitals (IPPS or CAH) that occur within 30 days of discharge from the prior proximal hospitalization, regardless of whether the readmission occurs during the SNF stay or takes place after the patient is discharged from the SNF. Because patients differ in complexity and morbidity, the measure is risk-adjusted for case-mix. Our approach for defining potentially preventable readmissions is described below.
This proposed measure focuses on readmissions that are potentially preventable and also unplanned. Similar to the SNF 30-Day All-Cause Readmission Measure (SNFRM) (NQF #2510), this measure uses the CMS Planned Readmission Algorithm to define planned readmissions. In addition to the CMS Planned Readmission Algorithm, this measure incorporates procedures that are considered planned in post-acute care settings, as identified in consultation with TEPs. Full details on the planned readmissions criteria used, including the additional procedures considered planned for post-acute care, can be found in the Measure Specifications (available at
This proposed measure assesses potentially preventable readmission rates while accounting for patient or resident demographics, principal diagnosis in the prior hospital stay, comorbidities, and other patient factors. The model also estimates a facility-specific effect, common to patients or residents treated in each facility. This proposed measure is calculated for each SNF based on the ratio of the predicted number of risk-adjusted, unplanned, potentially preventable hospital readmissions that occurred within 30 days of discharge from the prior proximal hospitalization, including the estimated facility effect, to the estimated predicted number of risk-adjusted, unplanned hospital readmissions for the same individuals receiving care at the average SNF. A ratio above 1.0 indicates a higher than expected readmission rate (worse), while a ratio below 1.0 indicates a lower than expected readmission rate (better). This ratio is referred to as the standardized risk ratio or SRR. The SRR is then multiplied by the overall national raw rate of potentially preventable readmissions for all SNF stays. The resulting rate is the risk-standardized readmission rate (RSRR) of potentially preventable readmissions. The full methodology is detailed in the Measure Specifications (available at
Eligible SNF stays in the measure are assessed until: (1) The 30-day period ends; or (2) the patient is readmitted to an acute care hospital (IPPS or CAH). If the readmission is classified as unplanned and potentially preventable, it is counted as a readmission in the measure calculation. If the readmission is planned or not preventable, the readmission is not counted in the measure rate.
Readmission rates are risk-adjusted for case-mix characteristics. The risk adjustment modeling estimates the effects of patient/resident characteristics, comorbidities, and select health care variables on the probability of readmission. More specifically, the risk-adjustment model for SNFs accounts for sociodemographic characteristics (age, sex, original reason for entitlement), principal diagnosis during the prior proximal hospital stay, body system specific surgical indicators, comorbidities, length of stay during the resident's prior proximal hospital stay, intensive care utilization, end-stage renal disease status, and number of prior acute care hospitalizations in the preceding 365 days. This measure is calculated using one full calendar year of data. The full measure specifications and results of the reliability testing can be found in the Measure Specifications (available at
Our measure development contractor convened a TEP, which provided input on the technical specifications of this measure, including the development of an approach to define potentially preventable hospital readmissions for a number of PAC settings, including SNFs. Details from the TEP meetings, including TEP members' ratings of conditions proposed as being potentially preventable, are available in the TEP Summary Report available on the CMS Web site (
In addition to our TEP and public comment feedback, we also considered input from the Measures Application Partnership (MAP) on the SNFPPR. The MAP is composed of multi-stakeholder groups convened by the NQF. The MAP provides input on the measures we are considering for implementation in certain quality reporting and pay-for-performance programs. In general, the MAP has noted the need for care transition measures in PAC/LTC performance measurement programs and stated that setting-specific admission and readmission measures would address this need.
The MAP encouraged continued development of the proposed measure in the SNF VBP Program to meet the mandate of PAMA. Specifically, the MAP stressed the need to promote shared accountability and ensure effective care transitions. More information about the MAP's recommendations for this measure is available at
We invite public comment on our proposal to adopt this measure, the SNF 30-Day Potentially Preventable Readmission Measure (SNFPPR).
Section 1888(h)(2)(B) of the Act requires the Secretary to apply the all-condition risk-adjusted potentially preventable hospital readmission measure specified under paragraph (g)(2) instead of the measure specified under paragraph (g)(1) as soon as practicable. We intend to propose the timing for the change to the paragraph (g)(2) measure in future rulemaking. We seek comment on when we should propose this change for the SNF VBP Program.
Sections 1888(h)(3)(A) of the Act requires the Secretary to establish performance standards for the SNF VBP Program. Under paragraph (h)(3)(B), the performance standards must include levels of achievement and improvement, and under paragraph (h)(3)(C), must be established and announced not later than 60 days prior to the beginning of the performance period for the FY involved.
In the FY 2016 SNF PPS final rule (80 FR 46419 through 46422), we summarized public comments we received on possible approaches to calculating performance standards under the SNF VBP Program. We specifically sought comment on the approaches that we have adopted for other Medicare VBP programs such as the Hospital VBP Program (Hospital VBP Program), the Hospital-Acquired Conditions Reduction Program (HAC Reduction Program), the Hospital Readmissions Reduction Program (HRRP), and the End-Stage Renal Disease Quality Incentive Program (ESRD QIP). We also sought comment on the best possible approach to measuring improvement, particularly given the SNF VBP Program's limitation to one measure for each program year.
We believe that an essential goal of the SNF VBP program is to provide incentives for all SNFs to improve the quality of care that they furnish to their residents. In determining what level of SNF performance would be appropriate to select as the performance standard for the quality measures specified under the SNF VBP program, we focused on selecting levels that would challenge SNFs to improve continuously or to maintain high levels of performance. To achieve this aim, we analyzed SNFRM data and examined how different achievement performance standards would impact SNFs' scores under the proposed scoring methodology described further below. As more data becomes available, we will continue to assess the appropriateness of these performance standards for the SNF VBP program and, if necessary, propose to refine these standards' definitions and calculation methodologies to better incentivize the provision of high-quality care.
Beginning with the FY 2019 SNF VBP program, we propose to define the achievement performance standard (which we will refer to as the “achievement threshold”) for quality measures specified under the SNF VBP program as the 25th percentile of national SNF performance on the quality measure during the applicable baseline period. We believe this achievement threshold definition represents an achievable standard of excellence and will reward SNFs appropriately for their performance on the quality measures specified for the SNF VBP program. We further believe this achievement threshold definition will provide strong incentives for SNFs to improve their performance on the measures specified for the SNF VBP Program continuously, and will result in a wide range of SNF measure scores that can be used in public reporting. We also seek comment on whether we should consider adopting either the 50th or 15th percentiles of national SNFs' performance on the quality measure during the applicable baseline period. We seek comment on data or other analysis that we should consider regarding the impact on SNFs' financial viability and service delivery to beneficiaries at either the higher or lower alternative standard. For example, while the 50th percentile would represent a more challenging threshold for care quality improvement, that standard would align with the Hospital VBP Program and would likely result in higher value-based incentive payments to top-performing SNFs than other definitions, though the actual distribution of value-based incentive payments would depend on all SNFs' performance and on the statutory rules governing their distribution. Such a standard would likely result in lower value-based incentive payments to lower-performing SNFs, which could create substantial payment disparities among participating SNFs. Conversely, the 15th percentile would likely result in higher value-based incentive payments for lower-performing SNFs than other thresholds, with the corresponding result of lower value-based incentive-payments for top-performing SNFs compared to other thresholds.
We further propose to define the “benchmark” for quality measures specified under the SNF VBP program as the mean of the top decile of SNF performance on the quality measure during the applicable baseline period. We believe this definition represents demonstrably high but achievable standards of excellence; in other words, the benchmark will reflect observed scores for the group of highest-performing SNFs on a given measure. This proposed benchmark policy aligns with that used by the Hospital VBP Program. As stated in the FY 2016 SNF PPS final rule (80 FR 46419 through 46420), we believe the Hospital VBP Program's performance standards methodology is a well-understood methodology under which health care providers and suppliers can be rewarded both for providing high-quality care and for improving their performance over time. We therefore believe it is appropriate to align with the Hospital VBP Program in setting benchmarks for the SNF VBP Program.
We also propose that SNFs would receive points along an achievement range, which is the scale between the achievement threshold and the benchmark. Under this proposal, SNFs would receive achievement points if they meet or exceed the achievement threshold for the specified measure, and could increase their achievement score based on higher levels of performance. (We describe the proposed scoring methodology, including how we propose to award points for both achievement and improvement, in the scoring methodology section of this proposed rule). This proposed achievement range policy aligns with that used by the Hospital VBP Program. We refer readers to the FY 2016 SNF PPS final rule (80 FR 46419 through
At this time, we do not have the complete CY 2015 data set necessary to calculate a numerical value for the proposed achievement threshold for the SNFRM. However, we are able to estimate this numerical value based on the most recent four quarters of SNFRM data available and have provided this estimate in Table 10. We intend to publish the final performance standards using complete data from CY 2015 in the FY 2017 SNF PPS final rule. For clarity, and as discussed further below, we have inverted the SNFRM rate so that a higher rate represents better performance.
We welcome public comment on the proposed definitions for achievement performance standards, as well as our intention to publish the final achievement threshold and benchmark for the FY 2019 Program year in the FY 2017 SNF PPS final rule.
Beginning with the FY 2019 SNF VBP program, we propose to define the improvement performance standard (which we will refer to as the “improvement threshold”) for quality measures specified under the SNF VBP program as each specific SNF's performance on the specified measure during the applicable baseline period. As discussed further below, we will measure SNFs' performance during both the proposed performance and baseline periods, and will award improvement points by comparing SNFs' performance to the improvement threshold. We believe this improvement performance standard ensures that SNFs will be adequately incentivized to improve continuously their performance on the quality measures specified under the SNF VBP Program, and appropriately balances our view that we should both reward SNFs for high performance and encourage improved performance over time.
We welcome public comment on this proposal.
Section 1888(h)(3)(C) of the Act requires the Secretary to establish and announce the performance standards for a given SNF VBP program year not later than 60 days prior to the beginning of the performance period for the FY involved. Based on the proposed performance period of CY 2017 for the FY 2019 SNF VBP Program, we believe that we must establish and announce performance standards for the FY 2019 Program not later than November 1, 2016. We intend to establish and announce performance standards for the Program in the annual SNF PPS rule, which is effective on October 1 of each year.
However, finalizing numerical values of these performance standards is often logistically difficult because it requires the collection and analysis of large amounts of quality measure data in a short period of time. For example, the data file for a full year of SNF claims data is typically completed around May of the following year. To calculate a numerical value for a performance standard, we must perform multiple levels of analyses on the data to ensure that all appropriate SNFs and patients are included in measure calculations; perform the measure calculations themselves; and then use those calculations to determine the numerical value for the performance standards. If any individual step of this process is delayed, it may preclude us from publishing finalized numerical values for the finalized performance standards in the applicable SNF PPS final rule, which is typically displayed publicly by August 1 of each year.
To retain the flexibility needed to ensure that numerical values published for the finalized performance standards are accurate, we are proposing to publish these numerical values no later than 60 days prior to the beginning of the performance period but, if necessary, outside of notice-and-comment rulemaking. As noted, we intend to publish numerical values for those performance standards in the final rule when practicable. However, in instances in which we cannot complete the necessary analyses in time to include them in the SNF PPS final rule, we propose to publish the numerical values for the performance standards on the QualityNet Web site used by SNFs to receive VBP information as soon as practicable but in no event later than the statutorily required 60 days prior to the beginning of the performance period for the fiscal year involved. In this instance, we would notify SNFs and the public of the publication of the performance standards using a listserv email and posting on the QualityNet News portion of the Web site.
We welcome public comment on this proposal.
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46422) for discussion of the considerations that we intended to take into account when specifying a performance period under the SNF VBP Program. We also explained our view that the SNF VBP Program necessitates adoption of a baseline period, similar to those adopted under the Hospital VBP Program and ESRD QIP, which we would use to establish performance standards and measure improvement.
We received public comments on this topic, and we refer readers to the FY 2016 SNF PPS final rule for a summary of those comments and our responses. We considered those comments when developing our performance and baseline period proposals for this proposed rule.
In considering various performance periods that could apply for the FY 2019 SNF VBP Program, we recognized that we must balance the length of the performance period used to collect quality measure data and the amount of data needed to calculate reliable, valid measure rates with the need to finalize a performance period through notice and comment rulemaking. We are
We strive to link performance furnished by SNFs as closely as possible to the payment year to ensure clear connections between quality measurement and value-based payment. We also strive to measure performance using a sufficiently reliable population of patients that broadly represent the total care provided by SNFs. As such, we anticipate that our annual performance period end date must provide sufficient time for SNFs to submit claims for the patients included in our measure population. Based on past experience with claims processing in other quality reporting and value-based purchasing programs, this time lag between care delivered to patients who are included in readmission measures and application of a payment consequence linked to reporting or performance on those measures has historically been close to one year. We also recognize that other factors contribute to the delay between data collection and payment impacts, including: The processing time needed to calculate measure rates using multiple sources of claims needed for statistical modeling; time for determining achievement and improvement scores; time for providers to review their measure rates and included patients; and processing time needed to determine whether a payment adjustment needs to be made to a provider's reimbursement rate under the applicable PPS based on its performance. Further, our preference is to adopt at least a 12-month period as the performance period, consistent with our view that using a full year's performance period provides sufficient levels of data accuracy and reliability for scoring SNF performance on the SNFRM and SNFPPR. We also believe that adopting a 12-month period for the performance period supports the direction provided of section 1888(g)(3) of the Act that the quality measures specified under the SNF VBP Program shall be designed to achieve a high level of reliability and validity. Specifically, we believe using a full year of claims data better ensures that the variation found among SNF performance on the measures is due to real differences between SNFs, and not within-facility variation due to issues such as seasonality. Additionally, we believe that adopting 12-month performance and baseline periods enables us to measure SNFs' performance on the specified measures in sequence, which we believe is necessary in order to measure SNFs on both achievement and improvement, as required by section 1888(h)(3)(B) of the Act.
Finally, we also considered the time necessary to calculate SNF-specific performance on the SNFRM after the conclusion of the performance period and to develop and provide SNF VBP scoring reports, including the requirement under section 1888(h)(7) of the Act that we inform each SNF of the adjustments to the SNF's payments as a result of the program not later than 60 days prior to the FY involved. Based on the requirements and concerns discussed above, we believe a 12-month time period is the only operationally feasible performance period for the SNF VBP Program.
We welcome public comment on this proposal.
As we have done in the Hospital VBP Program and the ESRD QIP, we are proposing to adopt a baseline period for use in the SNF VBP Program.
We propose to adopt calendar year 2015 claims (January 1, 2015 through December 31, 2015) as the baseline period for the FY 2019 SNF VBP Program and to use that baseline period as the basis for calculating performance standards. We will allow for a 90-day claims run out following the last date of discharge (December 31, 2015) before incorporating the 2015 claims in our database into the measure calculation.
We welcome public comment on this proposal.
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46422 through 46425) for a discussion of other Medicare VBP scoring methodologies, including the methodologies used by the Hospital VBP Program and HAC Reduction Program. We also discussed policy considerations related to the Hospital Readmission Reduction Program and the ESRD QIP in the performance standards section of that final rule (80 FR 46420 through 46421). We also discussed the potential application of an exchange function (80 FR 46424 through 46425) to translate SNF performance scores into value-based incentive payments under the SNF VBP Program.
We considered those issues, as well as comments we received on these issues, when developing our performance scoring policy below.
Section 1888(h)(4)(A) of the Act requires the Secretary develop a methodology for assessing the total performance of each SNF based on the performance standards established under section 1888(h)(3) of the Act for the measure applied under section 1888(h)(2) of the Act. Section 1888(h)(3)(B) of the Act further requires that these performance standards include levels of achievement and improvement and that, in calculating a facility's SNF performance score, the Secretary use the higher of either improvement or achievement.
After carefully reviewing and evaluating a number of scoring methodologies for the SNF VBP Program, we propose to adopt a scoring model for the SNF VBP Program similar conceptually to that used by the Hospital VBP Program and the ESRD QIP, with certain modifications to allow us to better differentiate between SNFs' performance on the quality measures specified under the SNF VBP Program.
We believe using wider scales of 0 to 100 points and 0 to 90 points instead of the 0 to 10 and 0 to 9 scales used in the Hospital VBP Program and ESRD QIP will allow us to calculate more granular performance scores for individual SNFs and provide greater differentiation between facilities' performance. We further believe that setting the achievement threshold for the SNF VBP Program at the 25th percentile of
For these reasons, we propose to adopt the following scoring methodology beginning with the FY 2019 SNF VBP Program.
Because the SNF VBP Program uses only one measure to incentivize and assess facility performance and improvement, we believe it is important to ensure that SNFs and the public are able to understand these measure scores easily. SNFRM rates represent the percentage of qualifying patients at a facility that were readmitted within the risk window for the measure. As a result, lower SNFRM rates indicate lower rates of readmission, and are therefore an indicator of higher quality care. For example, a SNFRM rate of 0.14159 means that approximately 14.2 percent of qualifying patients discharged from that SNF were readmitted during the risk window.
We understand that the use of a “lower is better” rate could cause confusion among SNFs and the public. Therefore, we propose to calculate scores under the Program by first inverting SNFRM rates using the following calculation:
This calculation inverts SNFs' SNFRM rates such that higher SNFRM performance reflects better performance on the SNFRM. As a result, the same SNFRM rate presented above (0.14159) would result in a SNFRM inverted rate of 0.85841, which means that approximately 86 percent of qualifying patients discharged from that SNF were not readmitted during the risk window. We believe this inversion is important to incentivize improvement in a clear and understandable manner, and will also simplify public reporting of SNF performance for use in consumer, family, and caregiver decision-making. Further, under this proposal, all SNFRM inverted rates would be rounded to the fifth significant digit.
We welcome public comment on this proposal.
We propose that a SNF would earn an achievement score of 0 to 100 points based on where its performance on the specified measure fell relative to the achievement threshold (which we propose above to define for the quality measures specified under the SNF VBP program as the 25th percentile of SNF performance on the quality measure during the applicable baseline period) and the benchmark (which we propose to define as the mean of the top decile of SNF performance on the measure during the baseline period). As with the Hospital VBP Program, we propose to award points to SNFs based on their performance as follows:
• If a SNF's SNFRM inverted rate was equal to or greater than the benchmark, the SNF would receive 100 points for achievement;
• If a SNF's SNFRM inverted rate was less than the achievement threshold (that is, the lower bound of the achievement range), the SNF would receive 0 points for achievement.
• If a SNF's SNFRM inverted rate was equal to or greater than the achievement threshold, but less than the benchmark, we would award between 0 and 100 points to the SNF according to the following formula:
The results of this formula would be rounded to the nearest whole number.
The SNF achievement score would therefore range between 0 and 100 points, with a higher achievement score indicating higher performance.
We welcome public comment on this proposal.
We propose that a SNF would earn an improvement score of 0 to 90 points based on how much its performance on the specified measure during the performance period improved from its performance on the measure during the baseline period. Under this proposal, a unique improvement range would be established for each SNF that defines the distance between the SNF's baseline period score and the national benchmark for the measure (which we propose to define as the mean of the top decile of SNF performance on the measure during the baseline period). We would then calculate a SNF improvement score for each SNF depending on its performance period score:
• If the SNF's performance period score was equal to or lower than its improvement threshold, the SNF would receive 0 points for improvement.
• If the SNF's performance period score was equal to or higher than the benchmark, the SNF would receive 90 points for improvement.
• If the SNF's performance period score was greater than its improvement threshold, but less than the benchmark, we would award between 0 and 90 points for improvement according to the following formula:
The results of this formula would be rounded to the nearest whole number.
We welcome public comment on this proposal.
Consistent with sections 1888(h)(3)(B) and 1888(h)(4)(A) of the Act, we propose to use the higher of a SNF's achievement and improvement scores to serve as the SNF's performance score for a given year of the SNF VBP Program. The resulting SNF performance score would be used as the basis for ranking SNF performance on the quality measures specified under the SNF VBP Program and establishing the value-based incentive payment percentage for each SNF for a given FY.
In this section, we provide two examples to illustrate the proposed scoring methodology for the FY 2019 SNF VBP Program using hypothetical SNFs A, B, and C. The benchmark calculated for the SNFRM for all of these hypotheticals is 0.83915 (the mean of the top decile of SNF performance on the SNFRM in 2014), and the achievement threshold is 0.79551 (the 25th percentile of national SNF performance on the SNFRM in 2014). We note that, as discussed previously, our proposal for scoring SNF performance on the SNFRM inverts the measure rates so that a higher rate represents better performance.
Figure AA shows the scoring for SNF A. SNF A's SNFRM rate of 0.15025 means that approximately 15 percent of qualifying patients discharged from SNF A were readmitted during the 30-day risk window. Under the proposed SNFRM scoring methodology, SNF A's SNFRM inverted rate would be calculated as follows:
As a result of this calculation, Facility A's SNFRM inverted rate would be 0.84975 on the SNFRM for the performance period. This result indicates that approximately 85 percent of SNF A's qualifying patients were
Figure BB shows the scoring for SNF B. As can be seen below, SNF B's performance on the SNFRM went from 0.21244, for a SNFRM inverted rate of 0.78756 (below the achievement threshold) in the baseline period to 0.18322, for a SNFRM inverted rate of 0.81668 (above the achievement threshold) in the performance period. Applying the achievement scoring methodology proposed above, SNF B would earn [49] achievement points for this measure, calculated as follows:
However, because SNF B's performance during the performance period is greater than its performance during the baseline period, but below the benchmark, we would calculate an improvement score as well. According to the improvement scale, based on SNF B's improved SNFRM inverted rate from 0.78756 to 0.81668, SNF B would receive 51 improvement points, calculated as follows:
In Figure CC, SNF C's performance on the SNFRM drops from 0.19487, for a SNFRM inverted rate of 0.80513, in the baseline period to 0.21148, for a SNFRM inverted rate 0.78852, in the performance period (a decline of 0.01661). Because this SNF's performance during the performance period is lower than the achievement threshold of 0.79551, it receives 0 points based on achievement. It would also receive 0 points for improvement, because its performance during the performance period is lower than its performance period during the baseline period. In this example, SNF C would receive 0 points for its SNF performance score.
Paragraphs (5), (6), (7), and (8) of section 1888(h) outline several requirements for value-based incentive payments under the SNF VBP Program. Section 1888(h)(5)(A) of the Act requires that the Secretary increase the adjusted Federal per diem rate for skilled nursing facilities by the value-based incentive payment amount determined under subsection (h)(5)(B). That amount is to be determined by the product of the adjusted Federal per diem rate and the value-based incentive payment percentage specified under subsection (h)(5)(C) of such section for each SNF for a FY.
Section 1888(h)(5)(C) requires that the value-based incentive payment percentage be based on the SNF performance score and must be appropriately distributed so that the highest-ranked SNFs receive the highest payments, the lowest-ranked SNFs receive the lowest payments, and that the payment rate for services furnished by SNFs in the lowest 40 percent of the rankings be less than would otherwise apply. Finally, the total amount of value-based incentive payments must be greater than or equal to 50 percent, but not greater than 70 percent, of the total amount of the reductions to payments for the FY specified under section 1888(h)(6) of the Act, as estimated by the Secretary. As discussed further below, we will propose to adopt in future rulemaking an exchange function to ensure that the total amount of value-based incentive payments made under the program each year meets those criteria.
Section 1888(h)(7) of the Act requires the Secretary, not later than 60 days prior to the fiscal year involved, to inform each SNF of the adjustments to its Medicare payments for services furnished by the SNF during the FY. Section 1888(h)(8) of the Act requires that the value-based incentive payment and payment reduction only apply for the FY involved, and not be taken into account in making payments to a SNF in a subsequent year.
As we discussed in the FY 2016 SNF PPS final rule (80 FR 46424 through 46425), we use a linear exchange function to translate a hospital's Total Performance Score under the Hospital VBP Program into the percentage multiplier to be applied to each Medicare discharge claim submitted by the hospital during the applicable FY. We intend to adopt a similar methodology to translate SNF performance scores into value-based incentive payment percentages under the SNF VBP Program. When considering that methodology, we sought public comments on the appropriate form and slope of the exchange function to determine how best to reward high performance and encourage SNFs to improve the quality of care provided to Medicare beneficiaries. As illustrated in Figure DD, we considered the following four mathematical exchange function options: Straight line (linear); concave curve (cube root function); convex curve (cube function); and S-shape (logistic function).
We received numerous public comments on the FY 2016 SNF PPS proposed rule, and we seek further public comments to inform our policies on this topic. For example, one commenter suggested that a linear exchange function would be the most transparent option for SNFs, which would assist in their quality improvement efforts. We request additional public comments on the specific form of the exchange function that we should propose in the future, including any additional forms beyond the four examples that we have illustrated above, and any considerations we should take into account when selecting an exchange function form that would best support quality improvement in SNFs.
Additionally, we will determine the precise slope of the exchange function after the performance period has concluded, because the distribution of SNFs' performance scores will form the basis for value-based incentive payments under the program. However, two additional considerations will affect the exchange function's slope. As required in section 1888(h)(5)(C)(ii)(II)(cc) of the Act, SNFs in the lowest 40 percent of the ranking determined under paragraph (4)(B) must receive a payment that is less than the payment rate for such services that would otherwise apply. Additionally, as described in this section, section 1888(h)(5)(C)(ii)(III) of the Act requires that the total amount of value-based incentive payments under the Program be greater than or equal to 50 percent, but not greater than 70 percent, of the total amount of reductions to SNFs' payments for the FY, as estimated by the Secretary. We intend to ensure that both of these requirements, as well as all other statutory requirements under the Program, are fulfilled when we specify the exchange function's slope.
We welcome public comments on this topic.
Section 1888(g)(5) of the Act requires that we provide quarterly confidential feedback reports to SNFs on their performance on the measures specified under sections 1888(g)(1) and (2) of the Act. Section 1888(g)(5) of the Act also
In order to meet the statutory deadline, we are developing the feedback reports, operational systems, and implementation guidance related to those reports. We intend to provide these reports to SNFs via the QIES system CASPER files currently used by SNFs to report quality performance. We welcome public comments on the appropriateness of the QIES system, and any considerations we should take into account when designing and providing these feedback reports.
Section 1888(g)(6) of the Act requires the Secretary to establish procedures to make public performance information on the measures specified under paragraphs (1) and (2) of such section. The procedures must ensure that a SNF has the opportunity to review and submit corrections to the information that will be made public for the facility prior to its being made public. This public reporting is also required by statute to begin no later than October 1, 2017. Additionally, section 1888(h)(9) of the Act requires the Secretary to make available to the public information regarding SNFs' performance under the SNF VBP Program, specifically including each SNF's performance score and the ranking of SNFs for each fiscal year.
Accordingly, we are proposing to adopt a two-phase review and correction process for (1) SNFs' measure data that will be made public under section 1888(g)(6) of the Act, which will consist of each SNFs' performance on the measures specified under sections 1888(g)(1) and (2) of the Act, and (2) SNFs' performance information that will be made public under section 1888(h)(9).
We view the quarterly confidential feedback reports described above as one possible means to provide SNFs an opportunity to review and provide corrections to their performance information. However, collecting SNF measure data and calculating measure performance scores takes a number of months following the end of a measurement period. Because it is not feasible to provide SNFs with an updated measure rate for each quarterly report or engage in review and corrections on a quarterly basis, we propose to use one of the four reports each year to provide SNFs an opportunity to review their data slated for public reporting. In this specific quarterly report, we intend to provide SNFs: (1) A count of readmissions; (2) the number of eligible stays at the SNF; (3) the SNF's risk-standardized readmissions ratio; and (4) the national SNF measure performance rate. In addition, we intend to provide the patient-level information used in calculating the measure rate. However, we seek comment on what patient-level information would be most useful to SNFs, and how we should make this information available if requested. We intend to address the topic of what specific information will be provided if requested in this specific quarterly report in future rulemaking, where we intend to propose a process for SNFs' requests for patient-level data. We intend to notify SNFs of this report's release via listserv email and posting on the QualityNet News portion of the Web site.
Therefore, we propose to fulfill the statutory requirement that SNFs have an opportunity to review and correct information that is to be made public under section 1888(g)(6) of the Act by providing SNFs with an annual confidential feedback report that we intend to provide via the QIES system CASPER files. We further propose that SNFs must, if they believe the report's contents to be in error, submit a correction request to
• SNF's CMS Certification Number (CCN).
• SNF Name.
• The correction requested and the SNF's basis for requesting the correction. More specifically, the SNF must identify the error for which it is requesting correction, and explain its reason for requesting the correction. The SNF must also submit documentation or other evidence, if available, supporting the request. Additionally, any requests made during phase one of the proposed process will be limited to the quality measure information at issue.
We further propose that SNFs must make any correction requests within 30 days of posting the feedback report via the QIES system CASPER files, not counting the posting date itself. For example, if we provide reports on October 1, 2017, SNFs must review those reports and submit any correction requests by October 31, 2017. We will not consider any requests for correction to quality measure data that are received after the close of the first phase of the proposed review and correction process. As discussed further below, any corrections sought during phase two of the proposed process will be limited to the SNF performance score calculation and the ranking.
We will review all timely phase one correction requests that we receive and will provide responses to SNFs that have requested corrections as soon as practicable.
As required by section 1888(h)(7) of the Act, we intend to inform each SNF of its payment adjustments as a result of the SNF VBP Program not later than 60 days prior to the fiscal year involved. For the FY 2019 SNF VBP Program, we intend to notify SNFs of those payment adjustments via a SNF performance score report not later than 60 days prior to October 1, 2018. We intend to address the specific contents of that report in future rulemaking.
In that report, however, we also intend to provide SNFs with their SNF performance scores and ranking. By doing so, we intend to use the performance score report's provision to SNFs as the beginning of the second phase of the proposed review and correction process. By completing phase one, SNFs will have an opportunity to verify that their quality measure data are fully accurate and complete, and as a result, phase two will be limited only to corrections to the SNF performance score's calculation and the SNF's ranking. Any requests to correct quality measure data that are received during phase two will be denied.
We intend to set out specific requirements for phase two of the proposed review and correction process in future rulemaking. To inform those proposals, we seek comments on what information would be most useful for us to provide to SNFs to facilitate their review of their SNF performance scores and ranking. As with the phase one process, we intend to adopt a 30-day time period for phase two review and corrections, beginning with the date on which we provide SNF performance score reports.
We welcome public comments on this proposed two-phase review and correction process.
Section 1888(h)(9)(A) of the Act requires that we make available to the public on the
We intend to address this topic in future rulemaking. However, we welcome public comments on the best means by which to display the SNF-specific and aggregate performance information for public consumption.
Section 1888(h)(4)(B) of the Act requires ranking the SNF performance scores determined under paragraph (A) of such section from low to high. Additionally, and as discussed in this section, we are required to publish the ranking of SNF performance scores for a FY on
To meet these requirements, we propose to order SNF performance scores from low to high and publish those rankings on both the
We welcome public comments on the most appropriate format and Web site for the ranking's publication.
We seek to promote higher quality and more efficient health care for Medicare beneficiaries, and our efforts are furthered by QRPs coupled with public reporting of that information.
The Improving Medicare Post-Acute Care Transformation Act of 2014 (IMPACT Act) added section 1899B to the Act that imposed new data reporting requirements for certain PAC providers, including SNFs, and required that the Secretary implement a SNF quality reporting program (SNF QRP). Section 1888(e)(6)(B)(i)(II) of the Act requires that each SNF submit, for FYs beginning on or after the specified application date (as defined in section 1899B(a)(2)(E) of the Act), data on quality measures specified under section 1899B(c)(1) of the Act and data on resource use and other measures specified under section 1899B(d)(1) of the Act in a manner and within the time frames specified by the Secretary. In addition, section 1888(e)(6)(B)(i)(III) of the Act requires, for FYs beginning on or after October 1, 2018, that each SNF submit standardized patient assessment data required under section 1899B(b)(1) of the Act in a manner and within the time frames specified by the Secretary. Section 1888(e)(6)(A)(i) of the Act requires that, for FYs beginning with FY 2018, if a SNF does not submit data, as applicable, on quality and resource use and other measures in accordance with section 1888(e)(6)(B)(i)(II) of the Act and on standardized patient assessment in accordance with section 1888(e)(6)(B)(i)(III) of the Act for such FY, the Secretary must reduce the market basket percentage described in section 1888(e)(5)(B)(ii) of the Act by 2 percentage points. The SNF QRP applies to freestanding SNFs, SNFs affiliated with acute care facilities, and all non-CAH swing-bed rural hospitals.
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46427 through 46429) for information on the and requirements of the IMPACT Act
In the FY 2016 SNF PPS final rule, we finalized the general timeline and sequencing of activities under the SNF QRP. Please refer to the FY 2016 SNF PPS final rule (80 FR 46427 through 46429) for more information on these topics.
In addition, in implementing the SNF QRP and IMPACT Act requirements in the FY 2016 SNF PPS final rule, we established our approach for identifying cross-setting measures and processes for the adoption of measures including the application and purpose of the Measures Application Partnership (MAP) and the notice and comment rulemaking process. For more information on these topics, please refer to the FY 2016 SNF PPS final rule (80 FR 46427 through 46429).
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46429 through 46431) for a detailed discussion of the considerations we apply in measure selection for the SNF QRP, such as alignment with the CMS Quality Strategy,
In this proposed rule, we propose to adopt for the SNF QRP one measure that we are specifying under section 1899B(c)(1)(C) of the Act to meet the Medication Reconciliation domain: (1) Drug Regimen Review Conducted with Follow-Up for Identified Issues-Post-Acute Care Skilled Nursing Facility Quality Reporting Program. Further, we are proposing to adopt for the SNF QRP three measures to meet the resource use and other measure domains identified in section 1899B(d)(1) of the Act: (1) Medicare Spending per Beneficiary—Post-Acute Care Skilled Nursing Facility Quality Reporting Program; (2) Discharge to Community—Post Acute Care Skilled Nursing Facility Quality Reporting Program; and (3) Potentially Preventable 30-Day Post-Discharge Readmission Measure for Skilled Nursing Facility Quality Reporting Program.
In our selection and specification of measures, we employ a transparent process in which we seek input from stakeholders and national experts and engage in a process that allows for pre-rulemaking input on each measure, as required by section 1890A of the Act.
To meet this requirement, we provided the following opportunities for stakeholder input. Our measure development contractor convened technical expert panels (TEPs) that included stakeholder experts and patient representatives on July 29, 2015 for the Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, on August 25, 2015, September 25, 2015, and October 5, 2015 for the Discharge to Community—PAC SNF QRP, on August 12 and 13, 2015 and October 14, 2015 for the Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP, and on October 29 and 30,
Additionally, we sought public input from the MAP PAC, Long-Term Care Workgroup during the annual in-person meeting held December 14 and 15, 2015. The final map report is available at
The MAP reviewed each measure proposed in this rule for use in the SNF QRP. For more information on the MAP, we refer readers to the FY 2016 SNF PPS final rule (80 FR 46430 through 46431). Further, for more information on the MAP's recommendations, we refer readers to the MAP 2015-2016 Considerations for Implementing Measures in Federal Programs public report at
In the FY 2016 SNF PPS final rule (80 FR 46431 through 46432), we finalized our policy for measure removal and also finalized that when we adopt a measure for the SNF QRP for a payment determination, this measure will be automatically retained in the SNF QRP for all subsequent payment determinations unless we propose to remove, suspend, or replace the measure. We are not proposing any new policies related to measure retention or removal. For further information on how measures are considered for removal, suspension, or replacement, please refer to the FY 2016 SNF PPS Final Rule (80 FR 46431 through 46432).
In the FY 2016 SNF PPS final rule (80 FR 46432), we finalized our policy pertaining to the process for adoption of non-substantive and substantive changes to SNF QRP measures. We are not proposing in this proposed rule to make any changes to this policy.
The SNF QRP quality measures for the FY 2018 payment determinations and subsequent years are presented in Table 12. Measure specifications for the previously adopted measures adapted from non-SNF settings are available at
For the FY 2018 payment determination and subsequent years, in addition to the quality measures identified in Table 12 that we are retaining under our policy described in section V.B.3., we are proposing three new measures for the SNF QRP. These three proposed measures were developed to meet the requirements of the IMPACT Act. They are: (1) Medicare Spending per Beneficiary-PAC SNF QRP; (2) Discharge to Community—PAC SNF QRP; and (3) Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP. The measures are described in more detail below.
For the risk adjustment of the resource use and other measures, we understand the important role that sociodemographic status plays in the care of patients. However, we continue to have concerns about holding providers to different standards for the outcomes of their patients of diverse sociodemographic status because we do not want to mask potential disparities or minimize incentives to improve the outcomes of disadvantaged populations. We routinely monitor the impact of
The NQF is currently undertaking a 2-year trial period in which new measures and measures undergoing maintenance review will be assessed to determine if risk-adjusting for sociodemographic factors is appropriate. For 2 years, NQF will conduct a trial of temporarily allowing inclusion of sociodemographic factors in the risk-adjustment approach for some performance measures. At the conclusion of the trial, NQF will issue recommendations on future permanent inclusion of sociodemographic factors. During the trial, measure developers are expected to submit information such as analyses and interpretations as well as performance scores with and without sociodemographic factors in the risk adjustment model.
Furthermore, the Office of the Assistant Secretary for Planning and Evaluation (ASPE) is conducting research to examine the impact of sociodemographic status on quality measures, resource use, and other measures under the Medicare program as directed by the IMPACT Act. We will closely examine the findings of the ASPE reports and related Secretarial recommendations and consider how they apply to our quality programs at such time as they are available.
We are inviting public comment on how socioeconomic and demographic factors should be used in risk adjustment for the resource use and other measures.
We are proposing an MSPB-PAC SNF QRP measure for inclusion in the SNF QRP for the FY 2018 payment determination and subsequent years. Section 1899B(d)(1)(A) of the Act requires the Secretary to specify resource use measures, including total estimated Medicare spending per beneficiary, on which PAC providers consisting of SNFs, Inpatient Rehabilitation Facilities (IRFs), Long-Term Care Hospitals (LTCHs), and Home Health Agencies (HHAs) are required to submit necessary data specified by the Secretary.
Rising Medicare expenditures for post-acute care as well as wide variation in spending for these services underlines the importance of measuring resource use for providers rendering these services. Between 2001 and 2013, Medicare PAC spending grew at an annual rate of 6.1 percent and doubled to $59.4 billion, while payments to inpatient hospitals grew at an annual rate of 1.7 percent over this same period.
We reviewed the NQF's consensus-endorsed measures and were unable to identify any NQF-endorsed resource use measures for PAC settings. As such, we are proposing this MSPB-PAC SNF measure under the Secretary's authority to specify non-NQF-endorsed measures under section 1899B(e)(2)(B) of the Act. Given the current lack of resource use measures for PAC settings, our proposed MSPB-PAC SNF measure has the potential to provide valuable information to SNF providers on their relative Medicare spending in delivering services to approximately 1.7 million Medicare beneficiaries.
The proposed MSPB-PAC SNF episode-based measure will provide actionable and transparent information to support SNF providers' efforts to promote care coordination and deliver high quality care at a lower cost to Medicare. The MSPB-PAC SNF measure holds SNF providers accountable for the Medicare payments within an “episode of care” (episode), which includes the period during which a patient is directly under the SNF's care, as well as a defined period after the end of the SNF treatment, which may be reflective of and influenced by the services furnished by the SNF. MSPB-PAC SNF episodes, constructed according to the methodology described below, have high levels of Medicare spending with substantial variation. In FY 2014, Medicare FFS beneficiaries experienced 1,534,773 MSPB-PAC episodes triggered by admission to a SNF. The mean payment-standardized, risk-adjusted episode spending for these episodes is $26,279. There is substantial variation in the Medicare payments for these MSPB-PAC SNF episodes—ranging from approximately $6,090 at the 5th percentile to approximately $60,050 at the 95th percentile. This variation is partially driven by variation in payments occurring following SNF treatment.
Evaluating Medicare payments during an episode creates a continuum of accountability between providers and has the potential to improve post-treatment care planning and coordination. While some stakeholders throughout the measure development process supported the measures and felt that measuring Medicare spending was critical for improving efficiency, others believed that resource use measures did not reflect quality of care in that they do not take into account patient outcomes or experience beyond those observable in claims data. However, SNFs involved in the provision of high-quality PAC care as well as appropriate discharge planning and post-discharge care coordination would be expected to perform well on this measure since beneficiaries would likely experience fewer costly adverse events (for example, avoidable hospitalizations, infections, and emergency room usage). Further, it is important that the cost of care be explicitly measured so that, in conjunction with other quality measures, we can recognize providers that are involved in the provision of high quality care at lower cost.
We have undertaken development of MSPB-PAC measures for each of the four PAC settings. We are proposing an LTCH-specific MSPB-PAC measure in the FY 2017 IPPS/LTCH proposed rule published elsewhere in this issue of the
The MSPB-PAC measures mirror the general construction of the inpatient prospective payment system (IPPS) hospital MSPB measure that was finalized in the FY 2012 IPPS/LTCH PPS final rule (76 FR 51618 through 51627). It was endorsed by the NQF on December 6, 2013 and has been used in the Hospital Value-Based Purchasing (VBP) Program (NQF #2158) since FY 2015.
MSPB-PAC episodes may begin within 30 days of discharge from an inpatient hospital as part of a patient's trajectory from an acute to a PAC setting. A SNF stay beginning within 30 days of discharge from an inpatient hospital will therefore be included once in the hospital's MSPB measure, and once in the SNF provider's MSPB-PAC measure. Aligning the hospital MSPB and MSPB-PAC measures in this way creates continuous accountability and aligns incentives to improve care planning and coordination across inpatient and PAC settings.
We have sought and considered the input of stakeholders throughout the measure development process for the MSPB-PAC measures. We convened a TEP consisting of 12 panelists with combined expertise in all of the PAC settings on October 29 and 30, 2015 in Baltimore, Maryland. A follow-up email survey was sent to TEP members on November 18, 2015 to which seven responses were received by December 8, 2015. The MSPB-PAC TEP Summary Report is available at
Since the MAP's review and recommendation of continued development, CMS has continued to refine risk adjustment models and conduct measure testing for the IMPACT Act measures in compliance with the MAP's recommendations. The proposed IMPACT Act measures are both consistent with the information submitted to the MAP and support the scientific acceptability of these measures for use in quality reporting programs.
In addition, a public comment period, accompanied by draft measures specifications, was originally open from January 13 to 27, 2016 and twice extended to January 29 and February 5. A total of 45 comments on the MSPB-PAC measures were received during this 3.5 week period. The comments received also covered each of the MAP's concerns as outlined in their Final Recommendations.
To calculate the MSPB-PAC SNF measure for each SNF provider, we first define the construction of the MSPB-PAC SNF episode, including the length of the episode window as well as the services included in the episode. Next, we apply the methodology for the measure calculation. The specifications are discussed further in this section. More detailed specifications for the proposed MSPB-PAC measures, including the MSPB-PAC SNF measure that we are proposing in this proposed rule, is available at
An MSPB-PAC SNF episode begins at the episode trigger, which is defined as the patient's admission to a SNF. This admitting facility is the attributed provider, for whom the MSPB-PAC SNF measure is calculated. The episode window is the time period during which Medicare FFS Part A and Part B services are counted towards the MSPB-PAC SNF episode. Because Medicare FFS claims are already reported to the Medicare program for payment purposes, SNF providers will not be required to report any additional data to
The episode window is comprised of a treatment period and an associated services period. The treatment period begins at the trigger (that is, on the day of admission to the SNF) and ends on the day of discharge from that SNF. Readmissions to the same facility occurring within 7 or fewer days do not trigger a new episode, and instead are included in the treatment period of the original episode. When two sequential stays at the same SNF occur within 7 or fewer days of one another, the treatment period ends on the day of discharge for the latest SNF stay. The treatment period includes those services that are provided directly or reasonably managed by the SNF provider that are directly related to the beneficiary's care plan. The associated services period is the time during which Medicare Part A and Part B services (with certain exclusions) are counted towards the episode. The associated services period begins at the episode trigger and ends 30 days after the end of the treatment period. The distinction between the treatment period and the associated services period is important because clinical exclusions of services may differ for each period. Certain services are excluded from the MSPB-PAC SNF episodes because they are clinically unrelated to SNF care, and/or because SNF providers may have limited influence over certain Medicare services delivered by other providers during the episode window. These limited service-level exclusions are not counted towards a given SNF provider's Medicare spending to ensure that beneficiaries with certain conditions and complex care needs receive the necessary care. Certain services that have been determined by clinicians to be outside of the control of a SNF provider include planned hospital admissions, management of certain preexisting chronic conditions (for example, dialysis for end-stage renal disease (ESRD), and enzyme treatments for genetic conditions), treatment for preexisting cancers, organ transplants, and preventive screenings (for example, colonoscopy and mammograms). Exclusion of such services from the MSPB-PAC SNF episode ensures that facilities do not have disincentives to treat patients with certain conditions or complex care needs.
An MSPB-PAC episode may begin during the associated services period of an MSPB-PAC SNF episode in the 30 days post-treatment. One possible scenario occurs where a SNF provider discharges a beneficiary who is then admitted to a HHA within 30 days. The HHA claim would be included once as an associated service for the attributed provider of the first MSPB-PAC SNF episode and once as a treatment service for the attributed provider of the second MSPB-PAC HHA episode. As in the case of overlap between hospital and PAC episodes discussed earlier, this overlap is necessary to ensure continuous accountability between providers throughout a beneficiary's trajectory of care, as both providers share incentives to deliver high quality care at a lower cost to Medicare. Even within the SNF setting, one MSPB-PAC SNF episode may begin in the associated services period of another MSPB-PAC SNF episode in the 30 days post-treatment. The second SNF claim would be included once as an associated service for the attributed SNF provider of the first MSPB-PAC SNF episode and once as a treatment service for the attributed SNF provider of the second MSPB-PAC SNF episode. Again, this ensures that SNF providers have the same incentives throughout both MSPB-PAC SNF episodes to deliver quality care and engage in patient-focused care planning and coordination. If the second MSPB-PAC SNF episode were excluded from the second SNF provider's MSPB-PAC SNF measure, that provider would not share the same incentives as the first SNF provider of first MSPB-PAC SNF episode. The MSPB-PAC SNF measure is designed to benchmark the resource use of each attributed provider against what their spending is expected to be as predicted through risk adjustment. As discussed further in this section, the measure takes the ratio of observed spending to expected spending for each episode and then takes the average of those ratios across all of the attributed provider's episodes. The measure is not a simple sum of all costs across a provider's episodes, thus mitigating concerns about double counting.
Medicare payments for Part A and Part B claims for services included in MSPB-PAC SNF episodes, defined according to the methodology above, are used to calculate the MSPB-PAC SNF measure. Measure calculation involves determination of the episode exclusions, the approach for standardizing payments for geographic payment differences, the methodology for risk adjustment of episode spending to account for differences in patient case mix, and the specifications for the measure numerator and denominator.
In addition to service-level exclusions that remove some payments from individual episodes, we exclude certain episodes in their entirety from the MSPB-PAC SNF measure to ensure that the MSPB-PAC SNF measure accurately reflects resource use and facilitates fair and meaningful comparisons between SNF providers. The proposed episode-level exclusions are as follows:
• Any episode that is triggered by a SNF claim outside the 50 states, DC, Puerto Rico, and U.S. Territories.
• Any episode where the claim(s) constituting the attributed SNF provider's treatment have a standard allowed amount of zero or where the standard allowed amount cannot be calculated.
• Any episode in which a beneficiary is not enrolled in Medicare FFS for the entirety of a 90-day lookback period (that is, a 90-day period prior to the episode trigger) plus episode window (including where the beneficiary dies), or is enrolled in Part C for any part of the lookback period plus episode window.
• Any episode in which a beneficiary has a primary payer other than Medicare for any part of the 90-day lookback period plus episode window.
• Any episode where the claim(s) constituting the attributed SNF provider's treatment include at least one related condition code indicating that it is not a prospective payment system bill.
Section 1899B(d)(2)(C) of the Act requires that the MSPB-PAC measures are adjusted for the factors described under section 1886(o)(2)(B)(ii) of the Act, which include adjustment for factors such as age, sex, race, severity of illness, and other factors that the Secretary determines appropriate. Medicare payments included in the MSPB-PAC SNF QRP measure are payment standardized and risk-adjusted. Payment standardization removes sources of payment variation not directly related to clinical decisions and facilitates comparisons of resource use across geographic areas. We propose to use the same payment standardization methodology as that used in the NQF-endorsed hospital MSPB measure. This methodology removes geographic payment differences, such as wage index and geographic practice cost index (GPCI), incentive payment adjustments, and other add-on payments that support broader Medicare program goals
Risk adjustment uses patient claims history to account for case-mix variation and other factors that affect resource use but are beyond the influence of the attributed SNF provider. To assist with risk adjustment, we create mutually exclusive and exhaustive clinical case mix categories using the most recent institutional claim in the 60 days prior to the start of the MSPB-PAC SNF episode. The beneficiaries in these clinical case mix categories have a greater degree of clinical similarity than the overall SNF patient population, and allow us to more accurately estimate Medicare spending. Our proposed MSPB-PAC SNF model, adapted for the SNF setting from the NQF-endorsed hospital MSPB measure uses a regression framework with a 90-day hierarchical condition category (HCC) lookback period and covariates including the clinical case mix categories, HCC indicators, age brackets, indicators for originally disabled, ESRD enrollment, and long-term care status, and selected interactions of these covariates where sample size and predictive ability make them appropriate. We sought and considered public comment regarding the treatment of hospice services occurring within the MSPB-PAC SNF episode window. Given the comments received, we propose to include the Medicare spending for hospice services but risk adjust for them, such that MSPB-PAC SNF episodes with hospice are compared to a benchmark reflecting other MSPB-PAC SNF episodes with hospice. We believe that this strikes a balance between the measure's intent of evaluating Medicare spending and ensuring that providers do not have incentives against the appropriate use of hospice services in a patient-centered continuum of care.
We understand the important role that sociodemographic factors, beyond age, play in the care of patients. However, we continue to have concerns about holding providers to different standards for the outcomes of their patients of diverse sociodemographic status because we do not want to mask potential disparities or minimize incentives to improve the outcomes of disadvantaged populations. We routinely monitor the impact of sociodemographic status on providers' results on our measures.
The NQF is currently undertaking a 2-year trial period in which new measures and measures undergoing maintenance review will be assessed to determine if risk-adjusting for sociodemographic factors is appropriate. For 2 years, NQF will conduct a trial of temporarily allowing inclusion of sociodemographic factors in the risk-adjustment approach for some performance measures. At the conclusion of the trial, NQF will issue recommendations on future permanent inclusion of sociodemographic factors. During the trial, measure developers are expected to submit information such as analyses and interpretations as well as performance scores with and without sociodemographic factors in the risk adjustment model.
Furthermore, the Office of the Assistant Secretary for Planning and Evaluation (ASPE) is conducting research to examine the impact of sociodemographic status on quality measures, resource use, and other measures under the Medicare program as required by the IMPACT Act. We will closely examine the findings of the ASPE reports and related Secretarial recommendations and consider how they apply to our quality programs at such time as they are available.
While we conducted analyses on the impact of age by sex on the performance of the MSPB-PAC SNF risk-adjustment model, we are not proposing to adjust the MSPB-PAC SNF measure for socioeconomic and demographic factors at this time. As this MSPB-PAC SNF measure will be submitted for NQF endorsement, we prefer to await the results of this trial and study before deciding whether to risk adjust for socioeconomic and demographic factors. We will monitor the results of the trial, studies, and recommendations. We are inviting public comment on how socioeconomic and demographic factors should be used in risk adjustment for the MSPB-PAC SNF measure.
The MPSB-PAC SNF measure is a payment-standardized, risk-adjusted ratio that compares a given SNF provider's Medicare spending against the Medicare spending of other SNF providers within a performance period. Similar to the hospital MSPB measure, the ratio allows for ease of comparison over time as it obviates the need to adjust for inflation or policy changes.
The MSPB-PAC SNF measure is calculated as the ratio of the MSPB-PAC Amount for each SNF provider divided by the episode-weighted median MSPB-PAC Amount across all SNF providers. To calculate the MSPB-PAC Amount for each SNF provider, one calculates the average of the ratio of the standardized episode spending over the expected episode spending (as predicted in risk adjustment), and then multiplies this quantity by the average episode spending level across all SNF providers nationally. The denominator for a SNF provider's MSPB-PAC SNF measure is the episode-weighted national median of the MSPB-PAC Amounts across all SNF providers. An MSPB-PAC SNF measure of less than 1 indicates that a given SNF provider's resource use is less than that of the national median SNF provider during a performance period. Mathematically, this is represented in equation (A) below:
The MSPB-PAC SNF resource use measure is an administrative claims-based measure. It uses Medicare Part A and Part B claims from FFS beneficiaries and Medicare eligibility files.
The measure cohort includes Medicare FFS beneficiaries with a SNF treatment period ending during the data collection period.
If this proposed measure is finalized, we intend to provide initial confidential feedback to providers, prior to public reporting of this measure, based on Medicare FFS claims data from discharges in CY 2016. We intend to publicly report this measure using claims data from discharges in CY 2017.
We propose a minimum of 20 episodes for reporting and inclusion in the SNF QRP. For the reliability calculation, as described in the measure specifications identified at
We invite public comment on our proposal to adopt the measure, MSPB-PAC SNF Measure for the SNF QRP.
Sections 1899B(d)(1)(B) and 1899B(a)(2)(E)(ii) of the Act require the Secretary to specify a measure to address the domain of discharge to community by SNFs, LTCHs, and IRFs by October 1, 2016, and HHAs by January 1, 2017. We are proposing to adopt the measure, Discharge to Community—PAC SNF QRP, for the SNF QRP for the FY 2018 payment determination and subsequent years as a Medicare FFS claims-based measure to meet this requirement.
This proposed measure assesses successful discharge to the community from a SNF setting, with successful discharge to the community including no unplanned rehospitalizations and no death in the 31 days following discharge from the SNF. Specifically, this proposed measure reports a SNF's risk-standardized rate of Medicare FFS residents who are discharged to the community following a SNF stay, and do not have an unplanned readmission to an acute care hospital or LTCH in the 31 days following discharge to community, and who remain alive during the 31 days following discharge to community. The term “community”, for this measure, is defined as home/self-care, with or without home health services, based on Patient Discharge Status Codes 01, 06, 81, and 86 on the Medicare FFS claim.
Discharge to a community setting is an important health care outcome for many residents for whom the overall goals of post-acute care include optimizing functional improvement, returning to a previous level of independence, and avoiding institutionalization. Returning to the community is also an important outcome for many residents who are not expected to make functional improvement during their SNF stay, and for residents who may be expected to decline functionally due to their medical condition. The discharge to community outcome offers a multi-dimensional view of preparation for community life, including the cognitive, physical, and psychosocial elements involved in a discharge to the community.
In addition to being an important outcome from a resident and family perspective, patients and residents discharged to community settings, on average, incur lower costs over the recovery episode, compared with those discharged to institutional settings.
Analyses conducted for ASPE on PAC episodes, using a 5 percent sample of 2006 Medicare claims, revealed that relatively high average, unadjusted Medicare payments are associated with discharge to institutional settings from IRFs, SNFs, LTCHs or HHAs, as compared with payments associated with discharge to community settings.
Measuring and comparing facility-level discharge to community rates is expected to help differentiate among facilities with varying performance in this important domain, and to help avoid disparities in care across resident groups. Variation in discharge to community rates has been reported
Discharge to community is an actionable health care outcome, as targeted interventions have been shown to successfully increase discharge to community rates in a variety of post-acute settings.
A TEP convened by our measure development contractor was strongly supportive of the importance of measuring discharge to community outcomes, and implementing the proposed measure, Discharge to Community—PAC SNF QRP in the SNF QRP. The panel provided input on the technical specifications of this proposed measure, including the feasibility of implementing the measure, as well as the overall measure reliability and validity. A summary of the TEP proceedings is available on the PAC Quality Initiatives Downloads and Videos Web site at
We also solicited stakeholder feedback on the development of this measure through a public comment period held from November 9, 2015, through December 8, 2015. Several stakeholders and organizations, including the MedPAC, among others, supported this measure for implementation. The public comment summary report for the proposed measure is available on the CMS Web site at
The NQF-convened MAP met on December 14 and 15, 2015, and provided input on the use of this proposed Discharge to Community—PAC SNF QRP measure in the SNF QRP. The MAP encouraged continued development of the proposed measure to meet the mandate of the IMPACT Act. The MAP supported the alignment of this proposed measure across PAC settings, using standardized claims data. More information about the MAP's recommendations for this measure is available at
Since the MAP's review and recommendation of continued development, we have continued to refine risk-adjustment models and conduct measure testing for this measure, as recommended by the MAP. This proposed measure is consistent with the information submitted to the MAP and is scientifically acceptable for current specification in the SNF QRP. As discussed with the MAP, we fully anticipate that additional analyses will continue as we submit this measure to the ongoing measure maintenance process.
We reviewed the NQF's consensus-endorsed measures and were unable to identify any NQF-endorsed resource use or other measures for post-acute care focused on discharge to community. In addition, we are unaware of any other post-acute care measures for discharge to community that have been endorsed or adopted by other consensus organizations. Therefore, we are proposing the measure, Discharge to Community—PAC SNF QRP, under the Secretary's authority to specify non-NQF-endorsed measures under section 1899B(e)(2)(B) of the Act.
We are proposing to use data from the Medicare FFS claims and Medicare eligibility files to calculate this proposed measure. We are proposing to use data from the “Patient Discharge Status Code” on Medicare FFS claims to determine whether a resident was discharged to a community setting for calculation of this proposed measure. In all PAC settings, we tested the accuracy of determining discharge to a community setting using the “Patient Discharge Status Code” on the PAC claim by examining whether discharge to community coding based on PAC claim data agreed with discharge to community coding based on PAC assessment data. We found excellent agreement between the two data sources in all PAC settings, ranging from 94.6 percent to 98.8 percent. Specifically, in the SNF setting, using 2013 data, we found 94.6 percent agreement in discharge to community codes when comparing discharge status codes on claims and the Discharge Status (A2100) on the Minimum Data Set (MDS) 3.0 discharge assessment, when the claims and MDS assessment had the same discharge date. We further examined the accuracy of the “Patient Discharge Status Code” on the PAC claim by assessing how frequently discharges to an acute care hospital were confirmed by follow-up acute care claims. We discovered that 88 percent to 91 percent of IRF, LTCH, and SNF claims with acute care discharge status codes were followed by an acute care claim on the day of, or day after, PAC discharge. We believe these data support the use of the claims “Patient Discharge Status Code” for determining discharge to a community setting for this measure. In addition, this measure can feasibly be implemented in the SNF QRP because all data used for measure calculation are derived from Medicare FFS claims and eligibility files, which are already available to CMS.
Based on the evidence discussed above, we are proposing to adopt the measure, Discharge to Community—PAC SNF QRP, for the SNF QRP for FY 2018 payment determination and subsequent years. This proposed measure is calculated using one year of data. We are proposing a minimum of 25 eligible stays in a given SNF for public reporting of the proposed measure for that SNF. Since Medicare FFS claims data are already reported to the Medicare program for payment purposes, and Medicare eligibility files are also available, SNFs will not be required to report any additional data to CMS for calculation of this measure. The proposed measure denominator is the risk-adjusted expected number of discharges to community. The proposed measure numerator is the risk-adjusted estimate of the number of residents who are discharged to the community, do not have an unplanned readmission to an acute care hospital or LTCH in the 31-day post-discharge observation window, and who remain alive during the post-discharge observation window. The measure is risk-adjusted for variables such as age and sex, principal diagnosis, comorbidities, ventilator status, ESRD status, and dialysis, among other variables. For technical information about this proposed measure, including information about the measure calculation, risk adjustment, and denominator exclusions, refer to the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 SNF QRP NPRM available at
If this proposed measure is finalized, we intend to provide initial confidential feedback to SNFs, prior to public reporting of this measure, based on Medicare FFS claims data from discharges in CY 2016. We intend to publicly report this measure using claims data from discharges in CY 2017. We plan to submit this proposed measure to the NQF for consideration for endorsement.
We are inviting public comment on our proposal to adopt the measure, Discharge to Community—PAC SNF QRP, for the SNF QRP.
Sections 1899B(a)(2)(E)(ii) and 1899B(d)(1)(C) of the Act require the Secretary to specify measures to address the domain of all-condition risk-adjusted potentially preventable hospital readmission rates by SNFs, LTCHs, and IRFs by October 1, 2016, and HHAs by January 1, 2017. We are proposing the measure Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP as a Medicare FFS claims-based measure to meet this requirement for the FY 2018 payment determination and subsequent years.
The proposed measure assesses the facility-level risk-standardized rate of unplanned, potentially preventable hospital readmissions for Medicare FFS
Hospital readmissions among the Medicare population, including beneficiaries that utilize PAC, are common, costly, and often preventable.
We have addressed the high rates of hospital readmissions in the acute care setting, as well as in PAC. For example, we developed the following measure: Skilled Nursing Facility 30-Day All-Cause Readmission Measure (SNFRM) (NQF #2510), as well as similar measures for other PAC providers (NQF #2502 for IRFs and NQF #2512 for LTCHs).
Several general methods and algorithms have been developed to assess potentially avoidable or preventable hospitalizations and readmissions for the Medicare population. These include the Agency for Healthcare Research and Quality's (AHRQ's) Prevention Quality Indicators, approaches developed by MedPAC, and proprietary approaches, such as the 3M
• Inadequate management of chronic conditions;
• Inadequate management of infections; and
• Inadequate management of other unplanned events.
Additional details regarding the definition for potentially preventable readmissions are available in the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 SNF QRP NPRM, available at
This proposed measure focuses on readmissions that are potentially preventable and also unplanned. Similar to the SNF 30-Day All-Cause Readmission Measure (NQF #2510), this proposed measure uses the current version of the CMS Planned Readmission Algorithm as the main component for identifying planned readmissions. A complete description of the CMS Planned Readmission Algorithm, which includes lists of planned diagnoses and procedures, can be found on the CMS Web site at
The proposed measure, Potentially Preventable 30-Day Post-Discharge Readmission Measure for Skilled Nursing Facility Quality Reporting Program, assesses potentially preventable readmission rates while accounting for patient demographics, principal diagnosis in the prior hospital stay, comorbidities, and other patient factors. While estimating the predictive power of patient characteristics, the model also estimates a facility-specific effect, common to patients treated in each facility. This proposed measure is calculated for each SNF based on the ratio of the predicted number of risk-adjusted, unplanned, potentially preventable hospital readmissions that occur within 30 days after a SNF discharge, including the estimated facility effect, to the estimated predicted number of risk-adjusted, unplanned inpatient hospital readmissions for the same patients treated at the average SNF. A ratio above 1.0 indicates a higher than expected readmission rate (worse) while a ratio below 1.0 indicates a lower than expected readmission rate (better). This ratio is referred to as the standardized risk ratio (SRR). The SRR is then multiplied by the overall national raw rate of potentially preventable readmissions for all SNF stays. The resulting rate is the risk-standardized readmission rate (RSRR) of potentially preventable readmissions. The full methodology of this proposed measure is detailed in the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 SNF QRP NPRM at
An eligible SNF stay is followed until: (1) The 30-day post-discharge period ends; or (2) the patient is readmitted to an acute care hospital (IPPS or CAH) or LTCH. If the readmission is unplanned and potentially preventable, it is counted as a readmission in the measure calculation. If the readmission is planned, the readmission is not counted in the measure rate. This measure is risk adjusted. The risk adjustment modeling estimates the effects of patient characteristics, comorbidities, and select health care variables on the probability of readmission. More specifically, the risk-adjustment model for SNFs accounts for demographic characteristics (age, sex, original reason for Medicare entitlement), principal diagnosis during the prior proximal hospital stay, body system specific surgical indicators, comorbidities, length of stay during the patient's prior proximal hospital stay, intensive care unit (ICU) utilization, end-stage renal disease status, and number of acute care hospitalizations in the preceding 365 days.
The proposed measure is calculated using 1 calendar year of FFS claims data, to ensure the statistical reliability of this measure for facilities. In addition, we are proposing a minimum of 25 eligible stays for public reporting of the proposed measure. For technical information about this proposed measure including information about the measure calculation, risk adjustment, and exclusions, refer to the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 SNF QRP NPRM at
A TEP convened by our measure development contractor provided recommendations on the technical specifications of this proposed measure, including the development of an approach to define potentially preventable hospital readmission for PAC. Details from the TEP meetings, including TEP members' ratings of conditions proposed as being potentially preventable, are available in the TEP Summary Report available on the CMS Web site at
The MAP encouraged continued development of the proposed measure. Specifically, the MAP stressed the need to promote shared accountability and ensure effective care transitions. More information about the MAP's recommendations for this measure is available at
We reviewed the NQF's consensus endorsed measures and were unable to identify any NQF-endorsed measures focused on potentially preventable hospital readmissions. We are unaware of any other measures for this IMPACT Act domain that have been endorsed or adopted by other consensus
We plan to submit the proposed measure to the NQF for consideration of endorsement. If this proposed measure is finalized, we intend to provide initial confidential feedback to SNFs, prior to public reporting of this proposed measure, based on 1 calendar year of claims data from discharges in CY 2016. We intend to publicly report this proposed measure using claims data from CY 2017.
We are inviting public comment on our proposal to adopt the measure, Potentially Preventable 30-Day Post-Discharge Readmission Measure for the SNF QRP.
In addition to the measures we are retaining as described in section V.B.5. of this proposed rule under our policy described in section V.B.3. of this proposed rule and the new quality measures proposed in section V.B.6. of this proposed rule for the FY 2018 payment determinations and subsequent years, we are also proposing one new quality measure to meet the requirements of the IMPACT Act for the FY 2020 payment determination and subsequent years. The proposed measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, addresses the IMPACT Act quality domain of Medication Reconciliation.
Sections 1899B (a)(2)(E)(i)(III) and 1899B(c)(1)(C) of the Act require the Secretary to specify a quality measure to address the domain of medication reconciliation by October 1, 2018 for IRFs, LTCHs and SNFs; and by January 1, 2017 for HHAs. We are proposing to adopt the quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PPAC SNF QRP, for the SNF QRP as a resident-assessment based, cross-setting quality measure to meet the IMPACT Act requirements with data collection beginning October 1, 2018 for the FY 2020 payment determinations and subsequent years.
This proposed measure assesses whether PAC providers were responsive to potential or actual clinically significant medication issue(s) when such issues were identified. Specifically, the proposed quality measure reports the percentage of resident stays in which a drug regimen review was conducted at the time of admission and timely follow-up with a physician occurred each time potential clinically significant medication issues were identified throughout that stay. For this proposed quality measure, a drug regimen review is defined as the review of all medications or drugs the patient is taking to identify any potential clinically significant medication issues. This proposed quality measure utilizes both the processes of medication reconciliation and a drug regimen review, in the event an actual or potential medication issue occurred. The proposed measure informs whether the PAC facility identified and addressed each clinically significant medication issue and if the facility responded or addressed the medication issue in a timely manner. Of note, drug regimen review in PAC settings is generally considered to include medication reconciliation and review of the patient's drug regimen to identify potential clinically significant medication issues.
Medication reconciliation is a process of reviewing an individual's complete and current medication list. Medication reconciliation is a recognized process for reducing the occurrence of medication discrepancies that may lead to Adverse Drug Events (ADEs).
The performance of timely medication reconciliation is valuable to the process of drug regimen review. Preventing and responding to ADEs is of critical importance as ADEs account for significant increases in health services utilization and costs
Medication errors include the duplication of medications, delivery of an incorrect drug, inappropriate drug omissions, or errors in the dosage, route, frequency, and duration of medications. Medication errors are one of the most common types of medical error and can occur at any point in the process of
There is strong evidence that medication discrepancies occur during transfers from acute care facilities to post-acute care facilities. Discrepancies occur when there is conflicting information documented in the medical records. Almost one-third of medication discrepancies have the potential to cause patient harm.
Medication reconciliation has been identified as an area for improvement during transfer from the acute care facility to the receiving post-acute care facility. Post-acute care facilities report gaps in medication information between the acute care hospital and the receiving post-acute care setting when performing medication reconciliation.
A TEP convened by our measure development contractor provided input on the technical specifications of this proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, including components of reliability, validity and the feasibility of implementing the measure across PAC settings. The TEP supported the measure's implementation across PAC settings and was supportive of our plans to standardize this measure for cross-setting development. A summary of the TEP proceedings is available on the PAC Quality Initiatives Downloads and Video Web site at
We solicited stakeholder feedback on the development of this measure by means of a public comment period held from September 18 through October 6, 2015. Through public comments submitted by several stakeholders and organizations, we received support for implementation of this proposed measure. The public comment summary report for the proposed measure is available on the CMS Public Comment Web site at
The NQF-convened MAP met on December 14 and 15, 2015 and provided input on the use of this proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP. The MAP encouraged continued development of the proposed quality measure to meet the mandate added by the IMPACT Act. The MAP agreed with the measure gaps identified by CMS including medication reconciliation, and stressed that medication reconciliation be present as an ongoing
Since the MAP's review and recommendation of continued development, we have continued to refine this proposed measure in compliance with the MAP's recommendations. The proposed measure is both consistent with the information submitted to the MAP and support its scientific acceptability for use in quality reporting programs. Therefore, we are proposing this measure for implementation in the SNF QRP as required by the IMPACT Act.
We reviewed the NQF's endorsed measures and identified one NQF-endorsed cross-setting quality measure related to medication reconciliation, which applies to the SNF, LTCH, IRF, and HHA settings of care: Care for Older Adults (COA) (NQF #0553). The quality measure, Care for Older Adults (COA) (NQF #0553) assesses the percentage of adults 66 years and older who had a medication review. The Care for Older Adults (COA) (NQF #0553) measure requires at least one medication review conducted by a prescribing practitioner or clinical pharmacist during the measurement year and the presence of a medication list in the medical record. This is in contrast to the proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, which reports the percentage of resident stays in which a drug regimen review was conducted at the time of admission and that timely follow-up with a physician occurred each time one or more potential clinically significant medication issues were identified throughout that stay.
After careful review of both quality measures, we have decided to propose the quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP for the following reasons:
• The IMPACT Act requires the implementation of quality measures, using patient assessment data that are standardized and interoperable across PAC settings. The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, employs three standardized resident-assessment data elements for each of the four PAC settings so that data are standardized, interoperable, and comparable; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure does not contain data elements that are standardized across all four PAC settings.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, requires the identification of potential clinically significant medication issues at the beginning, during and at the end of the resident's stay to capture data on each resident's complete PAC stay; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure only requires annual documentation in the form of a medication list in the medical record of the target population.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, includes identification of the potential clinically significant medication issues and communication with the physician (or physician designee), as well as resolution of the issue(s) within a rapid timeframe (by midnight of the next calendar day); whereas, the Care for Older Adults (COA), (NQF #0553) quality measure does not include any follow-up or timeframe in which the follow-up would need to occur.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, does not have age exclusions; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure limits the measure's population to patients aged 66 and older.
• The proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, will be reported to SNFs quarterly to facilitate internal quality monitoring and quality improvement in areas such as resident safety, care coordination and resident satisfaction; whereas, the Care for Older Adults (COA), (NQF #0553) quality measure would not enable quarterly quality updates, and thus data comparisons within and across PAC providers would be difficult due to the limited data and scope of the data collected.
Therefore, based on the evidence discussed above, we are proposing to adopt the quality measure entitled, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, for the SNF QRP for FY 2020 payment determination and subsequent years. We plan to submit the quality measure to the NQF for consideration for endorsement.
The calculation of the proposed quality measure would be based on the data collection of three standardized items to be included in the MDS. The collection of data by means of the standardized items would be obtained at admission and discharge. For more information about the data submission required for this proposed measure, please see section V.B.9. of this proposed rule.
The standardized items used to calculate this proposed quality measure do not duplicate existing items currently used for data collection within the MDS. The proposed measure denominator is the number of resident stays with a discharge or expired assessment during the reporting period. The proposed measure numerator is the number of stays in the denominator where the medical record contains documentation of a drug regimen review conducted at: (1) Admission; and (2) discharge with a look back through the entire resident stay, with all potential clinically significant medication issues identified during the course of care and followed-up with a physician or physician designee by midnight of the next calendar day. This measure is not risk adjusted. For technical information about this proposed measure including information about the measure calculation and discussion pertaining to the standardized items used to calculate this measure, refer to the document titled, Proposed Measure Specifications for Measures Proposed in the FY 2017 SNF QRP NPRM available at
Data for the proposed quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, would be collected using the MDS with submission through the Quality Improvement Evaluation System (QIES) Assessment Submission and Processing (ASAP) system.
We invite public comment on our proposal to adopt the quality measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, for the SNF QRP.
We are inviting comment on the importance, relevance, appropriateness, and applicability for each of the quality measures in Table 13 for future years in the SNF QRP. We are developing a measure related to the IMPACT Act domain, accurately communicating the existence of and providing for the transfer of health information and care
In the FY 2016 SNF PPS final rule (80 FR 46455), we established the requirements associated with the timing of data submission, beginning with the submission of data required for the FY 2018 payment determination, for new SNFs. We finalized that a new SNF would be required to begin reporting data on any quality measures finalized for that program year by no later than the first day of the calendar quarter subsequent to 30 days after the date on its CMS Certification Number (CCN) notification letter. For example, for FY 2018 payment determinations, if a SNF received its CCN on August 28, 2016, and 30 days are added (August 28 + 30 days = September 27), the SNF would be required to submit data for residents who are admitted beginning on October 1, 2016. We are not proposing any new policies related to the participation and timing for new SNFs.
In the FY 2016 SNF PPS final rule (80 FR 46457) for the FY 2018 payment determination, we finalized that SNFs submit data on the three finalized quality measures for residents who are admitted to the SNF on and after October 1, 2016, and discharged from the SNF up to and including December 31, 2016, using the data submission method and schedule that we proposed in this section. We also finalized that we would collect that single quarter of data for FY 2018 to remain consistent with the usual October release schedule for the MDS, to give SNFs a sufficient amount of time to update their systems so that they can comply with the new data reporting requirements, and to give CMS a sufficient amount of time to determine compliance for the FY 2018 program. The proposed use of one quarter of data for the initial year of quality reporting is consistent with the approach we used to implement a number of other QRPs, including the LTCH, IRF, and Hospice QRPs.
We also finalized that, following the close of the reporting quarter, October 1, 2016, through December 31, 2016, for the FY 2018 payment determination, SNFs would have an additional 5.5 months to correct and/or submit their quality data and we finalized that the final deadline for submitting data for the FY 2018 payment determination would be May 15, 2017. (80 FR 46457). The statement that SNFs would have an additional 5.5 months was incorrect in that the time between the close of the quarter on December 31, 2016 and May 15, 2017 is 4.5 months, not 5.5 months. Therefore, we propose that SNFs will have 4.5 months, from January 1, 2017 through May 15, 2017, following the data submission period of October 1, 2016 through December 31, 2016, in which to complete their data submissions and make corrections to their data where necessary.
In the FY 2016 SNF PPS final rule (80 FR 46457), we finalized that, for the FY 2019 payment determination, we would collect data from the 2nd through 4th quarters of FY 2017 (that is, data for residents who are admitted from January 1st and discharged up to and including September 30th) to determine whether a SNF has met its quality reporting requirements for that FY. In the FY 2016 SNF PPS final rule we also finalized that beginning with the FY 2020 payment determination, we would move to a full year of fiscal year (FY) data collection. We intended to propose the FY 2019 payment determination quality reporting data submission deadlines in future rulemaking.
In the FY 2016 SNF PPS final rule (80 FR 46457), we also finalized that we would collect FY 2018 data in a manner that would remain consistent with the usual October release schedule for the MDS. However, to align with the data reporting cycles in other quality reporting programs, in contrast to fiscal year data collection that we finalized last year, we are now proposing to move to calendar year (CY) reporting following the initial reporting of data from October 1, 2016, through December 31, 2016, as finalized in the FY 2016 SNF PPS final rule (80 FR 46457), for the FY 2018 payment determination.
More specifically, we are proposing to follow a CY schedule for measure and data submission requirements that includes quarterly deadlines following each quarter of data submission, beginning with data reporting for the FY 2019 payment determinations. Each quarterly deadline will occur approximately 4.5 months after the end of a given calendar quarter as outlined below in Table 15. This timeframe will give SNFs enough time to submit corrections to the assessment data, as discussed below. Thus, if finalized, the FY 2019 payment determination would be based on 12 calendar months of data reporting beginning on January 1, 2017, and ending on December 31, 2017 (that is, data from January 1, 2017, up to and including December 31, 2017.) This approach would enable CMS to move to a full 12 months of data reporting immediately following the first 3 months of reporting (October 1, 2016 through December 31, 2016 for the FY 2018 payment determination) rather than an interim year which uses only 9 months of data, and a subsequent 12 months of FY data reporting following the initial reporting for the FY 2018 payment determination.
We invite public comments on our proposal to adopt calendar year data collection time frames, following the initial 3-month reporting period from October 1, 2016, to December 31, 2016, for all measures finalized for adoption into the SNF QRP.
Our proposal to implement, for the FY 2019 payment determination and all subsequent years for assessment-based data submitted via the MDS, calendar year, quarterly data collection periods followed by data submission deadlines is consistent with the approach taken by the LTCH QRP and the IRF QRP, which are based on CY data and for which each data collection quarterly period is followed by a 4.5 month time frame that allows for the continued submission and correction of data until a deadline has been reached for that quarter of data. At that point, the data submitted becomes a frozen “snapshot” of data for both public reporting purposes and for the purposes of determining compliance in meeting the data reporting thresholds.
Further, we propose that beginning with FY 2019 payment determination, assessment-based measures finalized for adoption into the SNF QRP will follow a CY schedule of data reporting and quarterly review and correction periods
We invite public comment on the proposed data collection period and data submission deadlines affecting the FY 2019 payment determination and subsequent years and on our use of CY reporting with quarterly deadlines following a period of approximately 4.5 months of time to enable the correction of such data.
The Medicare Spending per Beneficiary—PAC SNF QRP, Discharge to Community—PAC SNF QRP, and Potentially Preventable Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP measures, which we have proposed in this proposed rule, are Medicare FFS claims-based measures. Because claims-based measures can be calculated based on data that are already reported to the Medicare program for payment purposes, no additional information collection will be required from SNFs. As previously discussed in V.B.6., for the Medicare Spending per Beneficiary—PAC SNF QRP Measure, the Discharge to Community—PAC SNF QRP measure and the Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP, we propose to use 1 year of claims data beginning with CY 2016 claims data to inform confidential feedback reports for SNFs, and CY 2017 claims data for public reporting.
We invite public comments on this proposal.
As discussed in section V.B.7. of this proposed rule, for the proposed measure, Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP, affecting FY 2020 payment determination and subsequent years, we are proposing that SNFs would submit data by completing data elements to be included in the MDS and then submitting the MDS to CMS through the Quality Improvement and Evaluation System (QIES), Assessment Submission and Processing System (ASAP) system beginning October 1, 2018. For more information on SNF QRP reporting through the QIES ASAP system, refer to the “Related Links” section at the bottom of:
We invite public comments on our proposed SNF QRP data collection requirements for the proposed measure affecting the FY 2020 payment determination and subsequent years.
For the FY 2020 payment determination, we propose that SNFs submit data on the proposed assessment-based quality measure for residents who are admitted to the SNF on and after October 1, 2018, and discharged from SNF Part A covered stays (that is, both residents discharged from Part A covered stays and physically discharged) up to and including December 31, 2018, using the data submission schedule that we propose in this section.
We propose to collect a single quarter of data for the FY 2020 payment determination to remain consistent with the usual October release schedule for the MDS, to give SNFs a sufficient amount of time to update their systems so that they can comply with the new data reporting requirements, and to give CMS a sufficient amount of time to determine compliance for the FY 2020 program. The proposed use of one quarter of data for the initial year of assessment data reporting in the SNF QRP is consistent with the approach we used previously for the SNF QRP and in other QRPs, including the LTCH, IRF, and Hospice QRPs in which we have finalized the use of fewer than 12 months of data.
We also propose that following the close of the reporting quarter, October 1, 2018, through December 31, 2018, for the FY 2020 payment determination, SNFs would have an additional 4.5 months to correct and/or submit their quality data and that the final deadline for submitting data for the FY 2020 payment determination would be May 15, 2019. We further propose that for the FY 2021 payment determination and subsequent years, we will collect data using the CY reporting cycle as previously proposed in section V.B.9.c of this proposed rule.
We invite public comment on the proposed new SNF QRP assessment-based quality measure data collection period and data submission deadline affecting the FY 2020 payment determination.
For this measure, we also propose to follow a CY schedule for measure and data submission requirements that includes quarterly deadlines following each quarter of data submission, beginning with data reporting for the FY 2021 payment determinations. As previously discussed, each quarterly deadline will occur approximately 4.5 months after the end of a given calendar quarter as outlined in Table 18. Thus, if finalized, the FY 2021 payment determination would be based on 12 calendar months of data reporting beginning January 1, 2019, and ending December 31, 2019. Table 18 provides the data submission and collection method, data collection period and data submission timelines for the assessment-based quality measure affecting the FY 2021 payment determination and subsequent years.
We invite public comment on the SNF QRP assessment-based quality measure data collection period and data submission deadline affecting the FY 2021 payment determination and subsequent years for the new assessment-based measure.
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46458) for our finalized policies regarding data completion thresholds for the FY 2018 payment determination and subsequent years. We finalized that, beginning with the FY 2018 payment determination, SNFs must report all of the data necessary to calculate the proposed quality measures on at least 80 percent of the MDS assessments that they submit. We also finalized that, for the FY 2018 SNF QRP, any SNF that does not meet the proposed requirement that 80 percent of all MDS assessments submitted contain 100 percent of all data items necessary to calculate the SNF QRP measures would be subject to a reduction of 2 percentage points to its FY 2018 market basket percentage. We finalized that a SNF has reported all of the data necessary to calculate the measures if the data actually can be used for purposes of calculating the quality measures, as opposed to, for example, the use of a dash [-], to indicate that the SNF was unable to perform a pressure ulcer assessment. We wish to clarify that the provision we finalized will affect FY 2018 payment determinations and subsequent years and is dependent upon the successful achievement of the completion threshold of the data used to calculate the measures we finalize. At this time, we are not proposing any changes to these policies.
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46458 through 46459) for a summary of our approach to the development of data validation process for the SNF QRP. At this time, we are continuing to explore data validation methodology that will limit the amount of burden and cost to SNFs, while allowing us to establish estimations of the accuracy of SNF QRP data. Hence, we are not proposing any further details pertaining to the data validation process for the SNF QRP, but we plan to do so in future rulemaking cycles.
We refer readers to the FY 2016 SNF PPS final rule (80 FR 46459 through 46460) for our finalized policies regarding submission exception and extension requirements for the FY 2018 payment determination and subsequent years. At this time, we are not proposing any changes to these policies.
We refer the reader to the FY 2016 SNF PPS final rule (80 FR 46460 through 46461) for a summary of our finalized reconsideration and appeals procedures for the SNF QRP for FY 2018 payment determination and subsequent years. At this time, we are not proposing any changes to these procedures.
Section 1899B(g) of the Act requires the Secretary to establish procedures for public reporting of SNFs' performance, including the performance of individual SNFs, on quality measures specified under paragraph (c)(1) and resource use and other measures specified under paragraph (d)(1) of the Act (collectively, IMPACT Act measures) beginning not later than 2 years after the applicable specified application date under section 1899B(a)(2)(E) of the Act. Under section 1899B(g)(2) of the Act, the procedures must ensure, including through a process consistent with the process applied under section 1886(b)(3)(B)(viii)(VII) of the Act, which refers to public display and review requirements in the Hospital Inpatient Quality Reporting Program (HIQR), that each SNF has the opportunity to review and submit corrections to its data and information that are to be made public
In this proposed rule, we are proposing procedures that would allow individual SNFs to review and correct their data and information on IMPACT Act measures that are to be made public before those measure data are made public.
For assessment-based measures, we propose a process by which we would provide each SNF with a confidential feedback report that would allow the SNF to review its performance on such measures and, during a review and correction period, to review and correct the data the SNF submitted to CMS via the CMS Quality Improvement and Evaluation System (QIES) Assessment Submission and Processing (ASAP) system for each such measure. In addition, during the review and correction period, the SNF would be able to request correction of any errors in the assessment-based measure rate calculations.
We propose that these confidential feedback reports would be available to each SNF using the Certification and Survey Provider Enhanced Reporting (CASPER) System. We refer to these reports as the SNF Quality Measure (QM) Reports. We propose to provide monthly updates to the data contained in these reports that pertain to assessment-based data, as the data become available. We propose to provide the reports so that providers would be able to view their data and information at both the facility- and resident-level for quality measures. The CASPER facility-level QM Reports may contain information such as the numerator, denominator, facility rate, and national rate. The CASPER patient-level QM Reports may contain individual patient information which will provide information related to which patients were included in the quality measures to identify any potential errors. In addition, we would make other reports available in the CASPER System, such as MDS data submission reports and provider validation reports, which would disclose SNFs' data submission status, providing details on all items submitted for a selected assessment and the status of records submitted. Additional information regarding the content and availability of these confidential feedback reports would be provided on an ongoing basis at
As previously proposed in section V.B.9.b, SNFs would have approximately 4.5 months after the reporting quarter to correct any errors that appear on the CASPER-generated QM reports pertaining to their assessment-based data used to calculate the assessment-based measures. During the time of data submission for a given quarterly reporting period and up until the quarterly submission deadline, SNFs could review and perform corrections to errors in the assessment data used to calculate the measures and could request correction of measure calculations. However, once the quarterly submission deadline occurs, the data is “frozen” and calculated for public reporting and providers can no longer submit any corrections. We would encourage SNFs to submit timely assessment data during a given quarterly reporting period and review their data and information early during the review and correction period so that they can identify errors and resubmit data before the data submission deadline.
As noted in this section, the data would be populated into the confidential feedback reports and we intend to update the reports monthly with all data that have been submitted and are available. We believe that a proposed data submission and review period consisting of the reporting quarter plus approximately 4.5 months, is sufficient time for SNFs to submit, review and, where necessary, correct their data and information. These proposed time frames and deadlines for review and correction of assessment-based measures and data satisfy the statutory requirement that SNFs be provided the opportunity to review and correct their data and information that is to be made public and are consistent with the informal process hospitals follow in the HIQR Program.
We propose that, in addition to the data collection/submission quarterly reporting periods that are followed by data review and correction periods and submission deadlines, we afford SNFs a 30-day preview period prior to public display during which SNFs may preview the performance information on their measures that will be made public. We propose to provide a preview report also using the CASPER System with which SNFs are familiar. The CASPER preview reports would inform providers of their performance on each measure which will be publicly reported. The CASPER preview reports for the reporting quarter will be available after the 4.5-month review and correction period and its data submission deadline, and are refreshed on a quarterly basis for those measures publicly reported quarterly, and annually for those measures publicly reported annually. We propose to give SNFs 30 days to review this information, beginning from the date on which they can access the preview report. Corrections to the underlying data would not be permitted during this time; however, SNFs may contest incorrect measure calculations during the 30-day preview period. We propose that if CMS determines that the measure, as it is displayed in the preview report, contains a calculation error, CMS could suppress the data on the public reporting Web site, recalculate the measure and publish it at the time of the next scheduled public display date. This process would be consistent with that followed in the HIQR Program. If finalized, we intend to utilize a subregulatory mechanism, such as our SNF QRP Web site, to explain the process for how and when providers may ask for a correction to their measure calculations.
We invite public comment on these proposals.
In addition to assessment-based measures, we have also proposed claims-based measures for the SNF QRP. As noted in this section, section 1899B(g)(2) of the Act requires prepublication provider review and correction procedures that are consistent with those followed in the HIQR Program. For claims-based measures used in the HIQR Program, we provide hospitals 30 days to preview their claims-based measures and data in a preview report containing aggregate hospital-level data. We propose to adopt a similar process for the SNF QRP.
Prior to the public display of our claims-based measures, in alignment with the HIQR, HAC and HVBP Programs, we propose to make available through the CASPER system a confidential preview report that will contain information pertaining to claims-based measure rate calculations, for example, facility and national rates. Such data and information would be for feedback purposes only and could not be corrected. This information would be accompanied by additional confidential information based on the most recent administrative data available at the time we extract the claims data for purposes of calculating the rates. Because the claims-based measures are calculated on an annual basis, these confidential CASPER QM reports for claims-based measures will be refreshed annually. SNFs would have 30 days from the date the preview report is made available in which to review this information. The 30-day preview period is the only time
The proposed claims-based measures—Medicare Spending per Beneficiary—PAC SNF QRP Measure; Discharge to Community—PAC SNF QRP and Potentially Preventable 30 Day Post-Discharge Readmission Measure for SNF QRP—use Medicare administrative data from hospitalizations for Medicare FFS beneficiaries. Public reporting of data will be based on one CY of data. We propose to create data extracts using claims data for these claims based measures, at least 90 days after the last discharge date in the applicable period (12 calendar months preceding), which we will use for the calculations. For example, if the last discharge date in the applicable period for a measure is December 31, 2017, for data collection January 1, 2017, through December 31, 2017, we would create the data extract on approximately March 31, 2018, at the earliest, and use that data to calculate the claims-based measures for that applicable period. Since SNFs would not be able to submit corrections to the underlying claims snapshot nor add claims (for those measures that use SNF claims) to this data set at the conclusion of the at least 90-day period following the last date of discharge used in the applicable period, at that time we would consider SNF claims data to be complete for purposes of calculating the claims-based measures.
We propose that beginning with data that will be publicly displayed in 2018, claims-based measures will be calculated using claims data with at least a 90 day run off period after the last discharge date in the applicable period, at which time we would create a data extract or snapshot of the available claims data to use for the measure calculations. This timeframe allows us to balance the need to provide timely program information to SNFs with the need to calculate the claims-based measures using as complete a data set as possible. As noted, under this proposed procedure, during the 30-day preview period, SNFs would not be able to submit corrections to the underlying claims data or add new claims to the data extract. This is for two reasons. First, for certain measures, the claims data used to calculate the measure is derived not from the SNF's claims, but from the claims of another provider. For example, the proposed measure Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP uses claims data submitted by the hospital to which the patient was readmitted. The claims are not those of the SNF, and therefore, the SNF could not make corrections to them. Second, even where the claims used to calculate the measures are those of the SNF, it would not be possible to correct the data after it is extracted for the measures calculation. This is because it is necessary to take a static “snapshot” of the claims to perform the necessary measure calculations.
We seek to have as complete a data set as possible. We recognize that the proposed at least 90-day “run-out” period when we would take the data extract to calculate the claims-based measures is less than the Medicare program's current timely claims filing policy under which providers have up to one year from the date of discharge to submit claims. We considered a number of factors in determining that the proposed at least 90-day run-out period is appropriate to calculate the claims-based measures. After the data extract is created, it takes several months to incorporate other data needed for the calculations (particularly in the case of risk-adjusted or episode-based measures). We then need to generate and check the calculations. Because several months lead time is necessary after acquiring the data to generate the claims-based calculations, if we were to delay our data extraction point to 12 months after the last date of the last discharge in the applicable period, we would not be able to deliver the calculations to SNFs sooner than 18 to 24 months after the last discharge. We believe this would create an unacceptably long delay, both for SNFs and for us to deliver timely calculations to SNFs for quality improvement.
We invite public comment on these proposals.
Section 1899B(f) of the Act requires the Secretary to provide confidential feedback reports to post-acute care providers on their performance for the measures specified under paragraphs (c)(1) and (d)(1), beginning 1 year after the specified application date that applies to such measures and PAC providers. As discussed earlier, the reports we propose to provide to SNFs to review their data and information would be confidential feedback reports that would enable SNFs to review their performance on the measures required under the SNF QRP. We propose that these confidential feedback reports would be available to each SNF using the CASPER System. Data contained within these CASPER reports would be updated, as previously described, on a monthly basis as the data become available except for claims-based measures which can only be previewed on an annual basis.
We intend to provide detailed procedures to SNFs on how to obtain their confidential feedback CASPER reports on the SNF QRP Web site at
We seek public comment on this proposal to satisfy the requirement to provide confidential feedback reports to SNFs.
As discussed in the FY 2015 SNF PPS proposed rule (79 FR 25786, May 6, 2014), we contracted with Acumen, LLC to identify potential alternatives to the existing methodology used to pay for therapy services received under the SNF PPS. Since that time, in an effort to establish a comprehensive approach to Medicare Part A SNF payment reform, we subsequently expanded the scope of the SNF Therapy Payment Research project to examine potential improvements and refinements to the overall SNF PPS payment system. In this proposed rule, we are taking the opportunity to update the public on the current state of the expanded SNF PMR project.
As has been stated previously, in September 2013, we completed the first phase of the SNF PMR, which included a literature review, stakeholder outreach, supplementary analyses, and a comprehensive review of options for a viable alternative to the current therapy payment model. CMS produced a report outlining the most promising and viable options that we plan to pursue in the second phase of the project. The report is available at
During the second, and current, phase of the SNF PMR, which began in September 2013, our team has focused on developing the options outlined in the aforementioned report and has performed more comprehensive data analyses to begin outlining a new SNF payment model which could serve as a potential replacement for the current SNF PPS. To utilize the expertise of the stakeholder community in identifying the most viable alternative to the current SNF payment model, Acumen has hosted two TEPs. These TEPs brought together experts from across the SNF and post-acute care continuums to examine Acumen's research around a given topic and provide their comments and direction on where Acumen's research should continue.
The first TEP, which occurred in February 2015, was focused on the therapy component of SNF PPS. The objectives of this TEP were to discuss potential criteria for evaluating therapy payment approaches, review and discuss the key features of SNF therapy payment approaches, and solicit recommendations for the further exploration and development of SNF therapy payment approaches. The presentation given by Acumen during this TEP, as well as a report which provides a summary of the discussion and recommendations from the TEP panelists, is available
The second TEP, which occurred in November 2015, was focused on the nursing component of the SNF PPS. This TEP included discussion of both the adequacy of nursing payments, as well as discussion of non-therapy ancillaries (NTAs), such as drugs. The overall objectives of this TEP were to review and discuss implications of research on the nursing component of SNF payments, evaluate alternative approaches to payment for SNF nursing and NTA services, and solicit recommendations for the further exploration and development of SNF nursing payment approaches. The presentation given by Acumen during this TEP, as well as a report which provides a summary of the discussion and recommendations from the TEP panelists, is available at
We expect that Acumen will host a third TEP which will bring together the recommendations from stakeholders on the individual SNF payment elements, as well as the extensive analytic work conducted by Acumen, to outline what could serve as a potential revised SNF PPS payment model. As we have done with the two previous TEPs, we expect to post the presentation given by Acumen during this TEP, as well as a report which will provide a summary of the discussion and recommendations from the TEP panelists, after the TEP is completed.
As before, comments may be included as part of comments on this proposed rule. We are also soliciting comments outside the rulemaking process and these comments should be sent via email to
Section V.B.6. of this preamble proposes the following three claims based measures for the FY 2018 payment determination and subsequent years: (1) Medicare Spending per Beneficiary—PAC SNF QRP; (2) Discharge to Community—PAC SNF QRP; and (3) Potentially Preventable 30-Day Post-Discharge Readmission Measure for SNF QRP. These three measures are Medicare claims-based measures; because claims-based measures can be calculated based on data that are already reported to the Medicare program for payment purposes, we believe there will be no additional burden.
For the FY 2020 payment determination and subsequent years, in section V.B.6. we are also proposing one measure: Drug Regimen Review Conducted with Follow-Up for Identified Issues—PAC SNF QRP. Additionally, we propose that data for this measure will be collected and reported using the MDS (version effective October 1, 2018). While the reporting of data on quality measures is an information collection, we believe that the burden associated with modifications to the MDS discussed in this proposed rule fall under the PRA exceptions provided in section 1899B(m) of the Act because they are required to achieve the standardization of patient assessment data. Section 1899B(m) of the Act also provides that the PRA does not apply to section 1899B and the sections referenced in section 1899B(a)(2)(B) of the Act that require modification to achieve the standardization of patient assessment data. The requirement and burden will, however, be submitted to OMB for review and approval when the modifications to the MDS or other applicable PAC assessment instruments have achieved standardization and are no longer exempt from the burden submission requirements under section 1899B(m) of the Act.
We estimate the additional elements for the four newly proposed measures will take 7.5 minutes of nursing/clinical staff time to report data on admission and 2.5 minutes of nursing/clinical staff time to report data on discharge, for a total of 10 minutes. We estimate that the additional MDS-RAI items we are proposing will be completed by Registered Nurses (RN) for approximately 75 percent of the time required and Pharmacists for approximately 25 percent of the time required. Individual providers determine the staffing resources necessary. We estimate 2,101,370 discharges from 16,484 SNFs annually, with an additional burden of 10 minutes. This would equate to 350,228 total hours or 21.25 hours per SNF. We believe this work will be completed by RNs (75 percent) and Pharmacists (25 percent). We obtained mean hourly wages for these staff from the U.S. Bureau of Labor Statistics' May 2014 National Occupational Employment and Wage Estimates (
As described in further detail in section V.A.2.b. of this proposed rule, we are proposing to specify the SNFPPR measure for the SNF VBP Program. Like the SNFRM (NQF #2510), which was adopted for the SNF VBP Program in the FY 2016 SNF PPS final rule (80 FR 46419), the proposed SNFPPR measure is also claims-based. Because claims-based measures are calculated based on claims that are already submitted to the Medicare program for payment purposes, there is no additional burden associated with data collection or submission for these measures. Thus there is no additional reporting burden associated with the SNFPPR measure.
If you wish to comment on any of the aforementioned claims, please submit your comments as specified under the
Because of the large number of public comments we normally receive on
We have examined the impacts of this proposed rule as required by Executive Order 12866 on Regulatory Planning and Review (September 30, 1993), Executive Order 13563 on Improving Regulation and Regulatory Review (January 18, 2011), the Regulatory Flexibility Act (RFA, September 19, 1980, Pub. L. 96-354), section 1102(b) of the Act, section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA, March 22, 1995; Pub. L. 104-4), Executive Order 13132 on Federalism (August 4, 1999), and the Congressional Review Act (5 U.S.C. 804(2)).
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated an economically significant rule, under section 3(f)(1) of Executive Order 12866. Accordingly, we have prepared a regulatory impact analysis (RIA) as further discussed below. Also, the rule has been reviewed by OMB.
This proposed rule would update the FY 2016 SNF prospective payment rates as required under section 1888(e)(4)(E) of the Act. It also responds to section 1888(e)(4)(H) of the Act, which requires the Secretary to provide for publication in the
This proposed rule sets forth proposed updates of the SNF PPS rates contained in the SNF PPS final rule for FY 2016 (80 FR 46390). Based on the above, we estimate that the aggregate impact would be an increase of $800 million in payments to SNFs, resulting from the SNF market basket update to the payment rates, as adjusted by the MFP adjustment. The impact analysis of this proposed rule represents the projected effects of the changes in the SNF PPS from FY 2016 to FY 2017. Although the best data available are utilized, there is no attempt to predict behavioral responses to these changes, or to make adjustments for future changes in such variables as days or case-mix.
Certain events may occur to limit the scope or accuracy of our impact analysis, as this analysis is future-oriented, and thus, very susceptible to forecasting errors due to certain events that may occur within the assessed impact time period. Some examples of possible events may include newly-legislated general Medicare program funding changes by the Congress, or changes specifically related to SNFs. In addition, changes to the Medicare program may continue to be made as a result of previously-enacted legislation, or new statutory provisions. Although these changes may not be specific to the SNF PPS, the nature of the Medicare program is such that the changes may interact and, thus, the complexity of the interaction of these changes could make it difficult to predict accurately the full scope of the impact upon SNFs.
In accordance with sections 1888(e)(4)(E) and 1888(e)(5) of the Act, we would update the FY 2016 payment rates by a factor equal to the market basket index percentage change adjusted by the MFP adjustment to determine the payment rates for FY 2017. As discussed previously, for FY 2012 and each subsequent FY, as required by section 1888(e)(5)(B) of the Act, as amended by section 3401(b) of the Affordable Care Act, the market basket percentage is reduced by the MFP adjustment. The special AIDS add-on established by section 511 of the MMA remains in effect until such date as the Secretary certifies that there is an appropriate adjustment in the case mix. We have not provided a separate impact analysis for the MMA provision. Our latest estimates indicate that there are fewer than 4,800 beneficiaries who qualify for the add-on payment for residents with AIDS. The impact to Medicare is included in the total column of Table 19. In updating the SNF PPS rates for FY 2017, we made a number of standard annual revisions and clarifications mentioned elsewhere in this proposed rule (for example, the update to the wage and market basket indexes used for adjusting the federal rates).
The annual update set forth in this proposed rule applies to SNF PPS payments in FY 2017. Accordingly, the analysis that follows only describes the impact of this single year. In accordance with the requirements of the Act, we will publish a notice or rule for each subsequent FY that will provide for an update to the SNF PPS payment rates and include an associated impact analysis.
The FY 2017 SNF PPS payment impacts appear in Table 19. Using the most recently available data, in this case FY 2015, we apply the current FY 2016 wage index and labor-related share value to the number of payment days to simulate FY 2016 payments. Then, using the same FY 2015 data, we apply the proposed FY 2017 wage index and labor-related share value to simulate FY 2017 payments. We tabulate the resulting payments according to the classifications in Table 19 (for example, facility type, geographic region, facility
• The first column shows the breakdown of all SNFs by urban or rural status, hospital-based or freestanding status, census region, and ownership.
• The first row of figures describes the estimated effects of the various changes on all facilities. The next six rows show the effects on facilities split by hospital-based, freestanding, urban, and rural categories. The next nineteen rows show the effects on facilities by urban versus rural status by census region. The last three rows show the effects on facilities by ownership (that is, government, profit, and non-profit status).
• The second column shows the number of facilities in the impact database.
• The third column shows the effect of the annual update to the wage index. This represents the effect of using the most recent wage data available. The total impact of this change is zero percent; however, there are distributional effects of the change.
• The fourth column shows the effect of all of the changes on the FY 2017 payments. The update of 2.1 percent (consisting of the market basket increase of 2.6 percentage points, reduced by the 0.5 percentage point MFP adjustment) is constant for all providers and, though not shown individually, is included in the total column. It is projected that aggregate payments will increase by 2.1 percent, assuming facilities do not change their care delivery and billing practices in response.
As illustrated in Table 19, the combined effects of all of the changes vary by specific types of providers and by location. For example, due to changes proposed in this rule, providers in the urban Outlying region would experience a 2.3 percent increase in FY 2017 total payments.
As described in this section, we estimate that the aggregate impact for FY 2017 under the SNF PPS would be an increase of $800 million in payments to SNFs, resulting from the SNF market basket update to the payment rates, as adjusted by the MFP adjustment.
Section 1888(e) of the Act establishes the SNF PPS for the payment of Medicare SNF services for cost reporting periods beginning on or after July 1, 1998. This section of the statute prescribes a detailed formula for calculating payment rates under the SNF PPS, and does not provide for the use of any alternative methodology. It specifies that the base year cost data to be used for computing the SNF PPS payment rates must be from FY 1995 (October 1, 1994, through September 30, 1995). In accordance with the statute, we also incorporated a number of elements into the SNF PPS (for example, case-mix classification methodology, a market basket index, a wage index, and the urban and rural distinction used in the development or adjustment of the federal rates). Further, section 1888(e)(4)(H) of the Act specifically
As required by OMB Circular A-4 (available online at
This proposed rule sets forth updates of the SNF PPS rates contained in the SNF PPS final rule for FY 2016 (80 FR 46390). Based on the above, we estimate the overall estimated payments for SNFs in FY 2017 are projected to increase by $800 million, or 2.1 percent, compared with those in FY 2016. We estimate that in FY 2017 under RUG-IV, SNFs in urban and rural areas would experience, on average, a 2.1 and 2.1 percent increase, respectively, in estimated payments compared with FY 2016. Providers in the urban Outlying region would experience the largest estimated increase in payments of approximately 2.3 percent. Providers in the urban Pacific region would experience the smallest estimated increase in payments of 2.0 percent.
The proposed requirements set forth for the SNF VBP and SNF QRP Program in this proposed rule would not impact SNFs in FY 2017; therefore, we are not including a regulatory impact analysis for the SNF VBP and SNF QRP Program in this proposed rule.
The RFA requires agencies to analyze options for regulatory relief of small entities, if a rule has a significant impact on a substantial number of small entities. For purposes of the RFA, small entities include small businesses, non-profit organizations, and small governmental jurisdictions. Most SNFs and most other providers and suppliers are small entities, either by reason of their non-profit status or by having revenues of $27.5 million or less in any 1 year. We utilized the revenues of individual SNF providers (from recent Medicare Cost Reports) to classify a small business, and not the revenue of a larger firm with which they may be affiliated. As a result, we estimate approximately 91 percent of SNFs are considered small businesses according to the Small Business Administration's latest size standards (NAICS 623110), with total revenues of $27.5 million or less in any 1 year. (For details, see the Small Business Administration's Web site at
This proposed rule sets forth updates of the SNF PPS rates contained in the SNF PPS final rule for FY 2016 (80 FR 46390). Based on the above, we estimate that the aggregate impact would be an increase of $800 million in payments to SNFs, resulting from the SNF market basket update to the payment rates, as adjusted by the MFP adjustment. While it is projected in Table 19 that most providers would experience a net increase in payments, we note that some individual providers within the same region or group may experience different impacts on payments than others due to the distributional impact of the FY 2017 wage indexes and the degree of Medicare utilization.
Guidance issued by the Department of Health and Human Services on the proper assessment of the impact on small entities in rulemakings, utilizes a cost or revenue impact of 3 to 5 percent as a significance threshold under the RFA. According to MedPAC, Medicare covers approximately 12 percent of total patient days in freestanding facilities and 21 percent of facility revenue (Report to the Congress: Medicare Payment Policy, March 2016, available at
In addition, section 1102(b) of the Act requires us to prepare a regulatory impact analysis if a rule may have a significant impact on the operations of a substantial number of small rural hospitals. This analysis must conform to the provisions of section 603 of the RFA. For purposes of section 1102(b) of the Act, we define a small rural hospital as a hospital that is located outside of an MSA and has fewer than 100 beds. This proposed rule would affect small rural hospitals that (1) furnish SNF services under a swing-bed agreement or (2) have a hospital-based SNF. We anticipate that the impact on small rural hospitals would be similar to the impact on SNF providers overall. Moreover, as noted in previous SNF PPS final rules (most recently the one for FY 2016 (80 FR 46476)), the category of small rural hospitals would be included within the analysis of the impact of this proposed rule on small entities in general. As indicated in Table 19, the effect on facilities is projected to be an aggregate positive impact of 2.1 percent. As the overall impact on the industry as a whole is less than the 3 to 5 percent threshold discussed above, the Secretary has determined that this proposed rule would not have a significant impact on a substantial number of small rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) also requires that agencies assess anticipated costs and benefits before issuing any rule whose mandates require spending in any 1 year of $100
Executive Order 13132 establishes certain requirements that an agency must meet when it issues a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on state and local governments, preempts state law, or otherwise has federalism implications. This proposed rule would have no substantial direct effect on state and local governments, preempt state law, or otherwise have federalism implications.
This proposed regulation is subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801
Federal Communications Commission.
Final rule.
In this document, the Federal Communications Commission (Commission) adopts significant reforms to place the universal service program on solid footing for the next decade to “preserve and advance” voice and broadband service in areas served by rate-of-return carriers.
Effective May 25, 2016, except for the amendments to §§ 51.917(f)(4), 54.303(b), 54.311(a), 54.313(a)(10), (e)(1), (e)(2) and (f)(1), 54.316(a)(b), 54.319(e), 54.903(a), 69.132, 69.311, 69.4(k), and 69.416 which contain new or modified information collection requirements that will not be effective until approved by the Office of Management and Budget. The Federal Communications Commission will publish a document in the
Alexander Minard, Wireline Competition Bureau, (202) 418-0428 or TTY: (202) 418-0484.
This is a summary of the Commission's Report and Order, Order and Order on Reconsideration in WC Docket Nos. 10-90, 14-58; CC Docket No. 01-92; FCC 16-33, adopted on March 23, 2016 and released on March 30, 2016. The full text of this document is available for public inspection during regular business hours in the FCC Reference Center, Room CY-A257, 445 12th Street SW., Washington, DC 20554. Or at the following Internet address:
1. With this Report and Order, Order and Order on Reconsideration, and concurrently adopted Further Notice of Proposed Rulemaking (FNPRM), the Commission adopts significant reforms to place the universal service program on solid footing for the next decade to “preserve and advance” voice and broadband service in areas served by rate-of-return carriers. In 2011, the Commission unanimously adopted transformational reforms to modernize universal service for the 21st century, creating programs to support explicitly broadband-capable networks. In this Report and Order, Order, Order on Reconsideration, and concurrently adopted FNPRM, the Commission takes necessary and crucial steps to reform our rate-of-return universal service mechanisms to fulfill our statutory mandate of ensuring that all consumers “have access to . . . advanced telecommunications and information services.” In particular, after extensive coordination and engagement with carriers and their associations, the Commission modernizes the rate-of-return program to support the types of broadband offerings that consumers increasingly demand, efficiently target support to areas that need it the most, and establish concrete deployment obligations to ensure demonstrable progress in connecting unserved consumers. This will provide the certainty and stability that carriers seek in order to invest for the future in the years to come. The Commission welcomes ongoing input and partnership as the Commission moves forward to implementing these reforms.
2. Rate-of-return carriers play a vital role in the high-cost universal service program. Many of them have made great strides in deploying 21st century networks in their service territories, in spite of the technological and marketplace challenges to serving some of the most rural and remote areas of the country. At the same time, millions of rural Americans remain unserved. In 2011, the Commission unanimously concluded that extending broadband service to those communities that lacked any service was one of core objectives of reform. At that time, it identified a rural-rural divide, observing that “some parts of rural America are connected to state-of-the art broadband, while other parts of rural America have no broadband access.” The Commission focuses now on the rural divide that exists within areas served by rate-of-return carriers. According to December 2014 Form 477 data, an estimated 20 percent of the housing units in areas served by rate-of-return carriers lack access to 10 Mbps downstream/1 Mbps upstream (10/1 Mbps) terrestrial fixed broadband service. It is time to close the gap, and take action to bring service to the consumers served by rate-of-return carriers that lack access to broadband. The Commission needs to modernize comprehensively the rate-of-return universal service program in order to benefit rural consumers throughout the country.
3. For years, the Commission has worked with active engagement from a wide range of interested stakeholders to develop new rules to support broadband-capable networks. One shortcoming of the current high-cost rules identified by rate-of-return carriers is that support is not provided if consumers choose to drop voice service, often referred to as “stand-alone broadband” or “broadband-only” lines. In the
4. The Report and Order establishes a new forward-looking, efficient mechanism for the distribution of support in rate-of-return areas. Specifically, the Commission adopts a voluntary path under which rate-of-return carriers may elect model-based support for a term of 10 years in exchange for meeting defined build-out obligations. The Commission emphasizes the voluntary nature of this mechanism; no carrier will be required to take model-based support. This action will advance the Commission's longstanding objective of adopting fiscally responsible, accountable and incentive-based policies to replace outdated rules and programs. The cost model, which has proven successful in distributing support for price cap carriers, has been adjusted in multiple ways over more than a year to take into account the circumstances of rate-of-return carriers. The Commission makes
5. The Commission also makes technical corrections to modernize our existing interstate common line support (ICLS) rules to provide support in situations where the customer no longer subscribes to traditional regulated local exchange voice service,
6. One of the core principles of reform since 2011 has been to ensure that support is provided in the most efficient manner possible, recognizing that ultimately American consumers and businesses pay for the universal service fund (USF). The Commission continues to move forward with our efforts to ensure that companies do not receive more support than is necessary and that rate of return carriers have sufficient incentive to be prudent and efficient in their expenditures, and in particular operating expenses. Therefore, the Commission adopts a method to limit operating costs eligible for support under rate-of-return mechanisms, based on a proposal submitted by the carriers. The Commission also adopts measures that will limit the extent to which USF support is used to support capital investment by those rate-of-return carriers that are above the national average in broadband deployment in order to help target support to those areas with less broadband deployment. Lastly, in order to ensure disbursed high-cost support stays within the established budget for rate-of-return carriers, building on proposals in the record, the Commission adopts a self-effectuating mechanism to control total support distributed pursuant to the HCLS and CAF-BLS mechanisms. The Commission recognizes that many carriers are eager to upgrade their existing broadband networks to provide service that exceeds the minimum standards that the Commission has established for recipients of high-cost support. But first, the Commission must ensure that our baseline service is truly universal. Each dollar spent on upgrading networks that already are capable of delivering 10/1 Mbps service is a dollar not available to extend service to those consumers that lack such service. Taken together, the Commission anticipates that these controls and limitations will encourage efficient spending by rate-of-return carriers, thereby enabling universal service support to be more effectively targeted to support investment in broadband-capable facilities in areas that remain unserved.
7. One of the core tenets of reform for the Commission in 2011 was to “require accountability from companies receiving support to ensure that public investments are used wisely to deliver intended results.” The Commission stated its expectation that rate-of-return carriers would deploy scalable broadband in their communities, but it declined at that time to adopt specific build-out milestones for rate-of-return carriers. Instead, it concluded that it would allow carriers to extend service upon reasonable request. Since that time, rate-of-return carriers have continued to extend service, with a 45 percent increase in availability of 10/1 Mbps service between 2012 and 2014. To build on that progress, the Commission now adopts specific broadband deployment obligations for all rate-of-return carriers, and not just for those that elect the voluntary path to the model. The Commission adopts deployment obligations for all rate-of-return carriers that can be measured and monitored, while tailoring those obligations to the unique circumstances of individual carriers. Those obligations will be individually sized for each carrier not electing model support, based on the extent to which it has already deployed broadband and its forecasted CAF BLS, taking into account the relative amount of depreciated plant and the density characteristics of individual carriers.
8. Another core tenet of reform adopted by the Commission in 2011, and unanimously reaffirmed in 2014, was to target support to areas that the market will not serve absent subsidy. To direct universal service support to those areas where it is most needed, the Commission adopts a rule prohibiting rate-of-return carriers from receiving CAF-BLS support in those census blocks that are served by a qualifying unsubsidized competitor. The Commission adopts a robust challenge process to determine which areas are in fact served by a qualifying unsubsidized competitor. The Commission does not expect the challenge process to be completed before the end of 2016, with support adjustments occurring no earlier than 2017. Carriers may elect one of several options for disaggregating support for those areas found to be competitive. Any support reductions resulting from implementation of this rule will be more effectively targeted to support existing and new broadband infrastructure in areas lacking a competitor.
9. Finally, the Commission takes action to modify our existing reporting requirements in light of lessons learned from their implementation. The Commission revises eligible telecommunications carriers' (ETC) annual reporting requirements to better align those requirements with our statutory and regulatory objectives. The Commission concludes that the public interest will be served by eliminating the requirement to file a narrative update to the five-year plan. Instead, the Commission adopts narrowly tailored reporting requirements regarding the location of new deployment offering service at various speeds, which will better enable the Commission to determine on an annual basis how high-cost support is being used to “improve broadband availability, service quality, and capacity at the smallest geographic area possible.”
10. In the Order and Order on Reconsideration, as part of our modernization of the rules governing rate-of-return carriers, the Commission represcribes the currently authorized rate of return from 11.25 percent to 9.75 percent. The rate of return is a key input in a rate-of-return incumbent local exchange carrier (LEC) revenue requirement calculation, which is the basis for both its common line and special access rates, and high-cost support as applicable. The current 11.25 percent rate of return is no longer consistent with the Act and today's
11. The actions the Commission takes today, combined with the rate-of-return reforms undertaken in the past two years, will allow us to continue to advance the goal of ensuring deployment of advanced telecommunications and information services networks throughout “all regions of the nation.” Importantly, they build on proposals from and collaboration with the carriers and their associations. Through the coordinated reforms the Commission takes today, they will provide rate-of-return carriers with equitable and sustainable support for investment in the deployment and operation of 21st century broadband networks throughout the country, providing stability for the future. Achieving universal access to broadband will not occur overnight, but today marks another step on the path toward that goal.
12. In this section, the Commission adopts a voluntary path for rate-of-return carriers to elect to receive model-based support in exchange for deploying broadband-capable networks to a pre-determined number of eligible locations. By creating a voluntary pathway to model-based support, the Commission will spur new broadband deployment in rural areas, which will help close the digital divide among rate-of-return carriers. As noted above, there is a wide disparity among rate-of-return study areas regarding the extent of coverage meeting the Commission's minimum standard of 10/1 Mbps service: Based on December 2014 FCC Form 477 data, an estimated 20 percent of housing units in census blocks served by rate-of-return carriers lack access to 10/1 Mbps terrestrial fixed broadband service, while other rate-of-return carriers have deployed 10/1 Mbps to nearly all of their study area. The option of receiving model-based support will provide the opportunity for carriers that have made less progress in their broadband deployment than other rate-of-return carriers to “catch up.” By creating defined performance and deployment obligations for specific and predictable support amounts, the Commission is completing the framework envisioned by the Commission in the 2011
13. As discussed more fully below, the election of model-based support places those carriers in a different regulatory paradigm. They no longer will be subject to rate-of-return regulation for common line offerings, and they no longer will participate in the National Exchange Carrier Association's (NECA's) common line pool. Effectively, the carriers that choose to take the voluntary path to the model are electing incentive regulation for common line offerings.
14.
15.
16. Similarly, here, the Commission recognizes that their minimum requirements for rate-of-return carriers will likely evolve over the next decade. NTCA argues that a universal service program premised upon achieving speeds of 10/1 Mbps risks locking rural America into lower service levels. The Commission agrees that our policies should take into account evolving standards in the future. At the same time, the Commission recognizes that it is difficult to plan network deployment not knowing the performance obligations that might apply by the end of the 10-year term. The Commission finds that establishing speed and other performance requirements now for carriers electing model-based support is preferable to doing so at some point mid-way through the 10-year term, as it will provide more certainty for carriers electing this voluntary path. Rate-of-return carriers that comply with the performance requirements the Commission establishes today for the duration of the 10-year term will be deemed in compliance even if the Commission subsequently establishes different standards that are generally applicable to the high-cost support mechanisms before the end of the 10-year term.
17. The Commission concludes that rate-of-return carriers electing model support will be required to maintain voice and existing broadband service and to offer at least 10/1 Mbps to all locations “fully funded” by the model, and at least 25/3 Mbps to a certain percentage of those locations, by the end of the support term. The Commission adopts with minor modifications ITTA and USTelecom's proposal to require carriers with a state-level density of more than ten locations per square mile to offer at least 25/3 Mbps to at least 75 percent of the fully funded locations in the state by the end of the 10-year term. For administrative convenience, the Commission will determine these density thresholds based on housing units, rather than locations in the model, because other density measures adopted in this Order will rely on U.S. Census data for housing units. The Commission concludes that carriers with a state-level density of ten or fewer, but more than five, housing units per square mile will be required to offer at least 25/3 Mbps to at least 50 percent
18. In addition, the Commission establishes defined requirements for making progress towards extending broadband to capped locations within their service areas. Specifically, carriers electing model support will be required to offer at least 4/1 Mbps to a defined number of locations that are not fully funded (
19.
20. In addition, the Commission adopts our proposal to require rate-of-return carriers accepting model-based support to certify that 95 percent or more of all peak period measurements of network round-trip latency are at or below 100 milliseconds. No party objected to adopting this standard for public interest obligations for rate-of-return carriers. This latency standard will apply to all locations that are fully funded. As discussed below, the Commission recognizes there may be need for relaxed standards in areas that are not fully funded, where carriers may use alternative technologies to meet their public interest obligations.
21.
22. The Commission declines to adopt an approach that would base a company's build-out obligations solely on the extent to which its model-based support exceeds its legacy support. The Commission agrees with proponents of such an approach that the locations to which a company will be required to
23. The Commission is not persuaded by the argument that they should tie broadband deployment obligations only to the supplemental support in excess of legacy support and determine the extent of new broadband deployment obligations based on modeled capital costs. Our methodology is based on modeled capital and operating costs for each census block and provides the entire support amount calculated for areas above the funding benchmark and below the per-location funding cap; that is, these locations will be “fully funded” by the model under our method.
24.
25. The Commission also concludes that rate-of-return carriers receiving model-based support should have some flexibility in their deployment obligations to address unforeseeable challenges to meeting these obligations. When the Commission adopted flexibility in deployment obligations for price cap carriers accepting model-based support, they recognized that the “facts on the ground” when they are deploying facilities may necessitate some flexibility regarding the number of required locations. Because rate-of-return carriers electing model-based support may face similar circumstances, the Commission finds that providing the same flexibility and allowing deployment to less than 100 percent of the requisite locations is equally appropriate for these carriers as well. The Commission therefore will permit them to deploy to 95 percent of the required number of locations by the end of the 10-year term. To the degree an electing carrier deploys to less than 100 percent of the requisite locations, the remaining percentage of locations would be subject to the deployment obligations for the carrier's capped locations. The Commission does not require rate-of-return carriers to refund support if they deploy to at least 95% of the required locations, but not 100%, because they will use that support to maintain service and deploy new broadband to unserved customers under the standard for capped locations adopted above. And, as noted above, to the extent the electing carrier does not foresee being able to serve some fraction of the remaining five percent of locations in any way, not even with alternative technologies, the Commission encourages them to identify such census blocks for inclusion in an upcoming auction.
26. The Commission also notes that the customer location data utilized in the model reflect location data at a particular point in time. The precise number of locations in some funded census blocks is likely to change for a variety of reasons, which in some circumstances would make it impossible for a carrier to meet its deployment obligations. Carriers that discover there is a widely divergent number of locations in their funded census blocks as compared to the model should have the opportunity to seek an adjustment to modify the deployment obligations. Consistent with our action for Phase II in price cap territories, the Commission delegates authority to the Bureau to address these discrepancies by adjusting the number of funded locations downward and reducing associated funding levels.
27. The Commission is not persuaded that they should decline to impose intermediate deployment milestones for small rate-of-return carriers serving 10,000 or fewer locations in a state, as proposed by WTA. WTA argues that a 5,000 line carrier that is 60 percent built out and needs to extend broadband to 2,000 more locations cannot economically build out to 200 new locations each year, and that the most efficient way to proceed is to construct all 2,000 locations during one or two construction seasons. The deployment milestones the Commission adopts do not require evenly spaced new deployment each year, as WTA appears to assume. For instance, the carrier could fully complete its deployment obligation in years 5 and 6, if it found it more efficient to do the whole project over two construction seasons. The Commission would be concerned if such a hypothetical carrier were to wait until years 8 and 9 to begin extending broadband to its unserved customers; they would expect to see some progress toward deploying new broadband after receiving eight years of model-based support. Moreover, carriers that feel uncomfortable with intermediate deadlines may prefer to stay on legacy mechanisms.
28.
29. The Commission also makes all necessary decisions to calculate support
30. As noted above, over the past year, the Bureau has been continually working on refining the model so that it would be more suitable for use in rate-of-return areas. During this time, rate-of-return carriers and their associations have actively participated in this process, providing input on ways further to improve the model. For instance, the Bureau received and included certain data from nearly half of the approximately 1,100 study areas to better reflect their costs. As a result of this feedback and the resulting adjustments detailed below, the Commission believes that the final version of A-CAM will sufficiently estimate the costs of serving rate-of-return areas and that further adjustments are not necessary.
31. The first version of A-CAM, released in December 2014, was fundamentally the same as CAM 4.2 to provide a baseline for subsequent modifications. Although the cost model was originally developed for use in price cap areas, it always has included a size adjustment factor—based on rate-of-return company data—to scale operating expenses for “small, x-small, and xx-small” companies, and has reflected cost differences based on density. Thus, even though the model estimates the forward-looking costs of an efficient provider, it takes into account the higher operating expenses of small rate-of-return carriers operating in rural areas.
32. The Commission recognized the importance of accurate study area boundaries in using a model to calculate support for rate-of-return carriers. Whereas CAM used a commercial data source, GeoResults, to determine study area boundaries for the price cap carriers, the Commission directed the Bureau to incorporate the results of the Bureau's study area boundary data collection into A-CAM. From November 2014 to April 2015, the Bureau undertook a four-step process for adapting the study area boundary data for use in the model. The first step determined study area boundaries for purposes of the A-CAM by addressing overlaps that remained after the Bureau provided an opportunity to resolve overlaps and voids in the data originally submitted. The second step aligned the exchanges submitted by rate-of-return carriers (or state commissions on behalf of the incumbent) in the study area data collection with the study area boundaries to be used in the model and modified the exchanges to match the edges of the study area boundary where the submitted boundary of the exchanges differed from the modified study area boundary. The third step determined the potential locations to be used in the model for the placement of the central office (“Node0” in A-CAM) within each exchange. The final step ensured that each exchange was associated with a single Node0 location. In April 2015, the Bureau posted on the Commission's Web site the A-CAM map based on the study area boundary and exchange data that had been certified by the carriers and submitted to the Bureau.
33. Proposed corrections to study area and service area boundaries and Node0 locations were submitted by parties to the proceeding over the next several months. Recognizing that it would take several months to evaluate and incorporate study area boundary and Node0 locations submitted by interested parties in A-CAM, the Bureau continued to work on updating the model in other ways. In addition, with subsequent versions of the model the Bureau released illustrative results so that interested parties could better understand and evaluate how different assumptions used in calculating support impact the potential support calculated for a particular study area.
34. A-CAM contains two modules: A cost module that calculates costs for all areas of the country, and a support module, which calculates the support for each area based on those costs. The support module allows users to “filter” the cost data to focus on specific geographic areas, such as census blocks that are not served by an unsubsidized competitor. Support amounts depend on the funding benchmark that determines which areas are funded: Areas with an average cost below the funding benchmark are not funded because it is assumed that end user revenues are sufficient to cover the cost of serving such areas. Support amounts also depend on the mechanism utilized to keep total support calculated under the model within a given budget.
35. In March 2015, the Bureau released A-CAM version 1.0.1, which incorporated changes to broadband coverage using a minimum speed standard of 10/1 Mbps to determine the presence of a cable or fixed wireless competitor. The Bureau also released illustrative results under seven scenarios illustrating how different assumptions used in calculating support impact the potential support calculated for a particular study area. Five of the seven scenarios used a funding benchmark of $52.50, the same benchmark used to calculate support for price cap carriers. Two of these scenarios used an extremely high-cost threshold as the mechanism to keep total calculated support with the total budget for rate-of-return carriers. A third scenario utilized a different approach to keep total calculated support within the total budget for rate-of-return carriers: A per-location funding cap. Two scenarios used a $60 funding benchmark, which was suggested by parties to the proceeding as a mechanism to keep total support within the budget. This approach presumed that areas with an average cost per location less than $60 are competitively served by cable operators and therefore should be ineligible for support, which reduced support evenly across all locations in order to meet the budget. These two scenarios and two additional scenarios all exceeded the rate-of-return budget, however, but were published by the Bureau so that parties could consider alternative measures to maintain overall support within the budget, such as a dollar amount reduction in support per location, a percentage reduction in support per location, or a cap on support per location.
36. In May 2015, the Bureau published a revised A-CAM study area boundary map that updated the data used to identify a small number of Node0 locations, which improved the default locations if carriers did not propose any corrections, and provided additional time for carriers to submit Node0 locations. In July 2015, the Bureau announced upcoming modifications to A-CAM, including a code change to enable the use of company-specific plant mix (aerial, buried, and conduit) input values, instead of the state-wide default values, and invited parties to submit plant mix values for individual study areas. The
37. On August 31, 2015, the Bureau released A-CAM version 1.1, which updated the model to reflect FCC Form 477 broadband deployment data as of December 31, 2014. The prior version of A-CAM (v1.0.1) used SBI/NBM data as of June 30, 2013. FCC Form 477 data offers several advantages over the SBI/NBM data. The Form 477 data collection is mandatory, and Form 477 filers must certify to the accuracy of their data. The Bureau also released illustrative results produced using A-CAM v1.1 under three scenarios that illustrate how different per-location funding caps used in calculating support impact the potential support calculated for each rate-of-return study area in the country.
38. On October 8, 2015, the Bureau released A-CAM version 2.0, which incorporated the results of the Bureau's study area boundary data collection and further updated the model for use in rate-of-return areas. After months of review by the Bureau, A-CAM v2.0 incorporated updated exterior study area boundaries, interior service area boundaries, and/or Node0 locations for approximately 400 study areas. The network topology was updated to reflect these changes, and to address the fact that American Samoa and some coastal islands are served by a rate-of-return carriers. The middle mile network topology was updated to include an undersea route for American Samoa and submarine routes for service areas not connected by roads within the continental United States. To reflect the fact that rate-of-return carriers may have higher middle mile costs, A-CAM v2.0 added two connections from each regional access tandem ring to an Internet access point to account for the cost of connecting to the public Internet.
39. Previous versions of A-CAM included five size categories for investments related to land and buildings associated with central offices, and the smallest size central office was for those with fewer than 1,000 lines. Because some service areas in A-CAM have fewer than 250 locations, the updated capital expenditures input table created a new size category for central offices serving fewer than 250 locations, with lower land and building investment for these very small areas than exchanges with 250 to 1,000 locations. A-CAM v2.0 also was modified to incorporate study-area specific plant mix values, but because the Bureau was still reviewing these carrier submissions at that time, they were not reflected in this version of the model.
40. The Bureau also released A-CAM version 2.0 results that illustrate how three different per-location funding caps impact potential support. Although illustrative results for previous versions of A-CAM showed support using a per-location funding cap, A-CAM users could only approximate the Bureau's estimates. In A-CAM v2.0 and subsequent versions of the model, support can be calculated and reported using either an extremely high-cost threshold or a per-location funding cap. Support in A-CAM v2.0 is calculated using the average cost at the census block level for each study area (
41. On December 17, 2015, the Bureau released A-CAM v2.1, which incorporated study area-specific plant mix values submitted by rate-of-return carriers, updated broadband coverage data to address issues raised by rate-of-return commenters regarding reported competitive coverage, and provided an alternative coverage option that excludes from support calculations census blocks served with either FTTP or cable, as requested by one industry association. The Bureau also released results that illustrate how the two different coverage assumptions used in calculating support impact the potential support calculated for a particular study area; both sets of results are calculated using a $200 per-location funding cap. On February 17, 2016, the Bureau released additional illustrative results utilizing input values reflecting a 9.75 percent cost of money. Raising the cost of money increased costs for all study areas.
42. As directed, the Bureau incorporated the study area data and made other appropriate adjustments to A-CAM over the past year. The Commission finds that these modifications are sufficient for purposes of calculating support amounts for rate-of-return carriers electing to receive model support. A forward-looking cost model is designed to capture the costs of an efficient provider and does not generally use company-specific inputs values. As noted above, however, the A-CAM model takes into account the higher operating expenses of small, rate-of-return carriers operating in rural areas with a company size adjustment factor for operating expenses and cost differences based on density. The most significant modification is the incorporation of the study area boundary data. Although the commercial data set was an appropriate source for price cap carriers, the Commission recognizes that they serve significantly larger study areas than any of the more than 1,100 rate-of-return study areas. Because rate-of-return carriers serve smaller areas, it also was appropriate to provide for company-specific plant mix values if carriers found that the state-specific default values did not reflect their outside plant. The Commission notes that the average calculated A-CAM loop cost is greater than the largest embedded loop cost reported to NECA over the last fifteen years for the more than 500 study areas that submitted plant mix values.
43. As discussed in detail below, as part of our modernization of the framework for rate-of-return carriers for both high-cost support and special access ratemaking, the Commission represcribes the currently authorized rate of return from 11.25 percent to 9.75 percent. The Commission primarily relies on the methodology and data contained in the Wireline Competition Bureau's Staff Report, with some minor corrections and adjustments, identifies a more robust zone of reasonableness between 7.12 percent and 9.75 percent, and adopts a new rate of return at the upper end of this range. A-CAM currently uses an input value for the cost of money of 8.5 percent. The Bureau relied on the same methodology when it adopted that value for use in CAM, but focused solely on data from price cap carriers to select the input value for the price-cap carrier model. Consistent with the Commission's decision below regarding the authorized rate of return for rate-of-return carriers, now adopt an input value of 9.75 percent for the cost of money in A-CAM, thereby reflecting our consideration of the circumstances affecting rate-of-return carriers.
44. The Commission directs the Bureau to calculate support using a $200 per-location funding cap, rather than an extremely high-cost threshold. The Commission concludes that this methodology is preferable because it provides some support to all locations above the funding threshold. Even though the locations at or above the funding cap are not “fully funded” with model support, carriers will receive a significant amount of funding—
45. The Commission adopts a funding benchmark of $52.50, which is the same benchmark the Bureau adopted in its final version of CAM for purposes of making the offer of model-based support to price cap carriers. Based on the extensive record in the Connect America Phase II proceeding, the Bureau adopted a methodology for establishing a funding benchmark based on reasonable end user revenues. The Bureau adopted a blended average revenue per user (ARPU) of $75 that reflected revenues a carrier could reasonably expect to receive from each subscriber for providing voice, broadband, or a combination of those services. At the time, the speed standard was 4/1 Mbps, and the Bureau relied on information in the record regarding service offerings at or close to that speed. Now, the carriers electing model-based support will be required to offer 10/1 Mbps service, and 25/3 Mbps service to some subset of their customers, and therefore may earn higher revenues from their broadband services. The Bureau also adopted an expected subscription rate of 70 percent for purposes of estimating the amount of revenues a carrier may reasonably recover from end-users, and by extension, the funding benchmark. Applying an assumed ARPU of $75 and the 70 percent expected subscription rate, the funding benchmark is $52.50 per location. The record before the Bureau for CAM contained varying estimates and the Bureau acknowledged that forecasting potential ARPU for recipients of model-based support and the expected subscription rate necessarily requires making a number of predictive judgments. Nothing in the record before us now persuades us that consumers in rate-of-return carriers are less likely to subscribe to broadband where it is available than consumers served by price cap carriers.
46. The Commission is not persuaded that they should establish a different funding benchmark for purposes of making the offer of model-based support to rate-of-return carriers. During the A-CAM development process, the Bureau has released 15 versions of illustrative results and all but two used a funding benchmark of $52.50. Two versions used a $60 benchmark because commenters had suggested that a higher benchmark may be an alternative method for excluding areas served by an unsubsidized competitor. These and other commenters now support using a per-location funding cap rather than a higher benchmark.
47. One commenter argues that a subscription rate of 70 percent is too high and that the Commission should use 50 percent, because the adoption rate for the 10 Mbps speed tier in rural areas was only 47 percent in the
48. The Commission also concludes that it should prioritize model support to those areas that currently are unserved and direct the Bureau to exclude from the support calculations those census blocks where the incumbent rate-of-return carrier (or its affiliate) is offering voice and broadband service that meets the Commission's minimum standards for the high-cost program using FTTP or cable technology. For purposes of implementing this directive, the Bureau shall utilize June 2015 FCC Form 477 data that has been submitted and certified to the Commission prior to the date of release of this order; carriers may not resubmit their previously filed data to reduce their reported FTTP or cable coverage. While the Commission recognizes that these deployed census blocks require ongoing funding both to maintain existing service and in some cases to repay loans incurred to complete network deployments, it concludes that it is appropriate to make this adjustment to the model in order to advance our policy objective of advancing broadband deployment to unserved customers. Our decision to exclude from support calculations this subset of census blocks in no way indicates a belief that once networks are deployed, they no longer require support; rather, the Commission assumes that the carriers that have already deployed FTTP or cable broadband have done so within the existing legacy support framework. They will continue to receive HCLS and support through the reformed ICLS mechanism, and thus there is no need for a new mechanism to support their existing deployment. Those carriers are not required to elect model-based support and therefore this decision does not drastically reduce their support, as some allege.
49. When the Commission directed the Bureau “to undertake further work to update the Connect America Cost Model to incorporate the study area boundary data, and such other adjustments as may be appropriate,” the Commission did not envision revisiting the fundamental decisions made by the Bureau in developing CAM, such as the decision to develop a FTTP model. Adopting a significantly different model, such as a digital subscriber line (DSL) model for use in rate-of-return areas, would have significantly delayed this process and would have been backwards looking. The Commission concludes the changes adopted above should provide sufficient support for carriers interested in the model and account for most of the unique circumstances of different rate-of-return carriers. Therefore, the Commission declines to make further changes to data
50. Finally, the Commission rejects arguments in the record that the model should not be adopted because it produces support amounts that vary, in some cases significantly, from the amounts that particular carriers are currently receiving under the legacy mechanisms or that vary from actual costs of fiber-to-the-home construction. Some commenters cite a study conducted by Vantage Point comparing A-CAM results to FTTP engineering estimates and actual outside plant costs from 144 wire-center-wide projects to support their arguments that the model is not accurate. The Commission does not find that the Vantage Point analysis of variability between model results and its proprietary engineering data to be a useful comparison for several reasons. In particular, the Commission is not persuaded by the case study, node-by-node comparisons because the engineering data reflect a different network architecture than the network modeled in A-CAM. A-CAM assumes a Gigabit-Capable Passive Optical Network (GPON), with splitters in the field. Vantage Point's examples place the splitters in the central office, with one dedicated fiber for each end-user location. Instead of sharing one high-capacity fiber for up to 32 locations for some distance from the central office, the Vantage Point approach includes the cost for up to 32 fibers along the entire distance covered by outside plant. The Commission recognizes that placing splitters in the central office can lead to higher utilization and lower cost per location for splitters; however, they generally expect the higher cost for fiber materials and installation (including, for example, much greater splicing expense) greatly to outweigh any savings gained from better splitter utilization. Vantage Point did not provide enough information in its filings to quantify the impact of dedicated fibers in the feeder plant. In addition, Vantage Point's claim that the model shows consistent deviation based on cost per subscriber is misleading because Vantage Point uses cost per actual subscriber, whereas A-CAM uses cost per location passed. Even if there were no variation in cost, areas that would be more expensive on a per-subscriber basis would have lower A-CAM calculated costs unless the take rate were 100 percent.
51. As discussed above, A-CAM estimates the average monthly forward-looking economic cost of operating and maintaining an efficient, modern network, and is not intended to replicate the actual costs of a specific company at any particular point in time. Although one might expect forward-looking costs to capture greater efficiencies and, therefore, be lower than embedded costs, in fact, the forward-looking loop costs from A-CAM for most study areas are higher than embedded loop costs reported by rate-of-return carriers to NECA. In many cases, model-based support is less than legacy support, not because A-CAM calculates lower costs for a particular study area, but because the model excludes from support calculations those census blocks that are presumed to be served by an unsubsidized competitor offering voice and 10/1 Mbps service. This is consistent with the Commission's policy adopted in the
52.
53. At this point it is difficult to predict the extent to which companies may be interested in the voluntary path to the model and what the overall budgetary impact might be of such carrier elections. Even so, the Commission predicts that such additional funding will be sufficient to cover significant deployment and support elections to the model, including for those who will receive transition payments for a limited time in addition to model-based support. The Commission recognizes that carriers may have a variety of reasons for electing model support. In general, those carriers for whom A-CAM produces a significant increase in support over legacy support are more likely to elect model support than those who see little increase or a decrease, assuming that they view the increase in support as sufficient to meet the associated deployment obligations. At the same time, the Commission does not expect that all carriers for whom model-based support is significantly greater than legacy support will make the election: Some companies may not be prepared to meet the specific defined broadband build-out obligations that come with such support, while others may not be ready at this time to move to incentive regulation for their common line offering. The Commission describes below how they will adjust the offer of support and obligations to meet the defined CAF-ACAM budget.
54. The first step in determining the budgetary impact is to identify the universe of carriers that will potentially elect model-based support. After the final A-CAM results implementing the decisions the Commission adopts today are released, carriers will indicate within 90 days whether they are interested in electing model-based support. The final released results for the adopted model effectively will create a ceiling—the maximum amount of CAF-ACAM support a carrier may receive with the maximum number of
55. Reducing the funding cap per location would have the effect of reducing the number of fully funded locations that will be subject to defined broadband deployment obligations. Recognizing that these electing carriers may require more time to consider a revised offer, the Commission will require them to confirm their acceptance of the revised offer within 30 days.
56.
57. The Commission adopts our proposal to require participating carriers to make a state-level election, comparable to what the Commission required of price cap carriers. Our approach prevents rate-of-return carriers from cherry-picking the study areas in a state where model support is greater than legacy support, and retaining legacy support in those study areas where legacy support is greater. Requiring carriers with multiple study areas in a state to make a state-level election will allow them to make business decisions about managing different operating companies on a more consolidated basis. Carriers considering this voluntary path to the model will need to evaluate on a state-level basis whether the support received for multiple study areas, on balance, is sufficient to meet the state-level number of locations that must be served.
58. Because the Commission intends that the model-based path spur additional broadband deployment in those areas lacking service, they conclude that they will not make the offer of model-based support to any carrier that has deployed 10/1 broadband to 90 percent or more of its eligible locations in a state, based on June 2015 FCC Form 477 data that has been submitted as of the date of release of this Order. This will preserve the benefits of the model for those companies that have more significant work to do to extend broadband to unserved consumers in high-cost areas, and will prevent companies from electing model-based support merely to lock in existing support amounts. The Commission recognizes that carriers that are fully deployed in some cases have taken out loans to finance such expansion and therefore may have significant loan repayment obligations for years to come. Carriers that have heavily invested in recent years are likely to be receiving significant amounts of HCLS, however, and will continue to receive HCLS as well as CAF BLS, which is essentially equivalent to ICLS. Therefore, they are not prejudiced by their inability to elect the voluntary path to the model.
59. Carriers should submit their acceptance letters to the Bureau at
60. As noted above, after receipt of the acceptances, the Bureau then will determine whether the model support of electing carriers exceeds the overall 10-year budget for the model path set by the Commission. If necessary, the Bureau will publish revised model-based support amounts and revised deployment obligations, available only to those carriers that initially indicated they would take the voluntary election of model-based support. Carriers will be required to confirm within 30 days of release of this Public Notice that they are willing to accept the revised final offer; if they fail to do so, they will be deemed to have declined the revised offer.
61. If the Commission proceeds to the second step of the election process, those carriers that initially accepted but subsequently decline to accept the revised offer will continue to receive support through the legacy mechanisms, as otherwise modified by this Order. If the carrier received more support from the legacy mechanisms in 2015 than it was offered by the final model run, the overall budget for all carriers that receive support through the rate-of-return mechanisms (HCLS and reformed ICLS) will be reduced by the difference between the carrier's 2015 legacy support amount and the final amount of model support offered to that carrier. That difference will already have been redistributed amongst the remaining model carriers.
62.
63. The current version of A-CAM utilizes FCC Form 477 broadband deployment data as of December 31, 2014. While it is unlikely there has been a significant increase in broadband coverage in the intervening year by unsubsidized competitors in the specific blocks eligible for support in rate-of-
64.
65.
66.
67.
68. The Commission declines to adopt one commenter's proposed “safety net” that would limit a carrier's decrease in support in any year to five percent. The Commission concludes that a maximum of 10 years is sufficient time for electing carriers to transition down fully to their model-based support amount. By specifying in advance how this transition will occur, carriers will have all the information necessary to evaluate the possibility of electing model support. Carriers that find ten years insufficient time to transition to a lower amount remain free to remain on the reformed legacy mechanisms. The Commission requires rate-of-return carriers receiving transition payments in addition to model-based support to use the additional support to extend broadband service to locations that are fully-funded or that receive capped support.
69.
70. As established in the general oversight and compliance framework in the
71.
72. For rate-of-return carriers that do not elect to receive high-cost universal service support based on the A-CAM model, the Commission modernizes its embedded cost support mechanisms to encourage broadband deployment and support standalone broadband. Specifically, the Commission makes technical rule changes to our existing ICLS rules to support the provision of broadband service to consumers in areas with high loop-related costs, without regard to whether the loops are also used for traditional voice services. The Commission renames ICLS “Broadband Loop Support” as a component within the Connect America Fund (CAF BLS). Further, building on proposals in the record from the carriers, the Commission adopts operating expense limits, capital expenditure allowances, and budgetary controls that will be applicable to the HCLS and CAF BLS mechanisms to ensure efficient use of our finite federal universal service resources. These reforms together will better target support to advance the Commission's longstanding objective of closing the rural-rural divide in which some rural areas of the country have state-of-the-art broadband, while other parts of rural America have no broadband at all. The Commission expects that the combined effect of these measures will be to distribute support equitably and efficiently, and that all rate-of-return carriers will benefit from the opportunity to extend broadband service where it is cost-effective to do so.
73. The Commission now adopts technical changes to our existing ICLS rule to provide support for rate-of-return carriers' broadband-capable network loop costs, without regard to whether the loops are used to provide voice or broadband-only services. As explained above, although our existing HCLS and ICLS rules both support the loop costs associated with broadband-capable networks, they were developed specifically to support the costs of voice networks and do not provide cost recovery for loop costs associated with broadband-only services. After careful consideration of the various alternatives presented in the record, the Commission concludes that the simplest, most effective and administratively feasible means to address this concern is to expand the ICLS mechanism to permit recovery of consumer broadband loop costs. In a pending Petition for Reconsideration and Clarification of the
74. By providing support for the costs of broadband-only loops, while continuing to provide cost recovery for voice-only and voice-broadband loops, the expanded CAF-BLS mechanism will create appropriate incentives for carriers to deploy modern broadband-capable networks and to encourage consumer adoption of broadband services. The difference in loop-related expenses between broadband-only and traditional voice service over broadband-capable loops tends to be quite small, but the cost recovery varies significantly. Indeed, different treatment of loop cost recovery can be triggered by a customer's decision to drop the voice component of a voice-data bundle, without any other changes in service by the carrier. Similar changes to loop cost recovery occur if a carrier offers an IP-based voice service rather than a traditional voice service: only loops used to provide regulated local exchange voice service (including voice-data bundles) are eligible for high-cost universal service under our current rules. Supporting all consumer loops will minimize the discrepancies in treatment between those service offerings, while removing potential regulatory barriers to taking steps to offer new IP-based services in innovative ways. Thus, this step advances the statutory goal of providing access to advanced telecommunications and information services in all regions of the Nation, particularly in rural and high-cost areas, and the principle adopted in the
75. Implementing this expansion of the traditional ICLS mechanism requires several actions. As noted above, the current ICLS mechanism operates by providing each carrier with the difference between its interstate common line revenue requirement and its interstate common line revenues. Going forward, CAF-BLS also will provide cost recovery for the difference between a carrier's loop costs associated with providing broadband-only service, called the “consumer broadband-only loop revenue requirement” and its consumer broadband-only loop revenues. In this Order, the Commission adopts rules that define the consumer broadband-only loop costs as the same, on a per-line basis, as the costs that are currently recoverable for a voice-only or voice/broadband line in ICLS. To avoid double-recovery, an amount equal to the consumer broadband-only revenue requirement will also be removed from the special access cost category. Carriers will be required to certify to USAC, as part of their CAF-BLS data filings, that they have complied with our cost allocation rules and are not recovering any of the consumer broadband-only loop cost through the special access cost category. For consumer broadband-only loop revenue, CAF-BLS will initially impute the lesser of $42 per loop per month or its total consumer broadband loop revenue requirement. For true-up purposes, CAF BLS will impute the consumer broadband rate the carrier was permitted charge, if it is higher than the amount that would be imputed otherwise. As described below, the Commission also adopts today a budgetary constraint on the total aggregate amount of HCLS and CAF-BLS support provided for rate-of-return carriers to ensure that support remains within the established budget for rate-of-return territories. To the extent that budgetary constraint reduces CAF-BLS support in any given year, any CAF BLS provided will be first applied to ensure that each carrier's interstate common line revenue requirement is met. If, due to the application of the budgetary constraint, additional revenue is required to meet its consumer broadband loop revenue requirement, that revenue may be recovered through consumer broadband loop rates, even if that results in a carrier charging a broadband loop amount greater than $42 per loop per month.
76. This approach meets the four principles of reform that the Commission previously articulated in the
77. And finally, the reforms the Commission adopts today avoid double-recovery of costs by removing from special access the costs associated with broadband-only loops and then ensuring that the carriers' regulated revenues match their revenue requirements. The Commission finds this approach administratively preferable to alternative approaches. For example, one possibility would be to expand both ICLS and HCLS to include broadband-only loops. However, HCLS was designed to support local (
78. The latter approach would create a wholly new mechanism and bifurcate investment and associated expenses between old and new mechanisms. The Commission appreciates the good faith efforts of numerous parties to determine how such a mechanism might be implemented and to estimate its potential impact. While it had a number of merits, the Commission has come to the conclusion that the approach they adopt today is simpler and sufficient to accomplish our goals for reform. The Commission therefore chooses to build upon the framework of an existing rule that carriers are familiar with, which will not require significant changes to their internal existing accounting systems and other processes for the development of cost studies. Carriers should be able readily to estimate their future support flows under this revision to the existing rule.
79.
80. There are two cases in which the Commission will impute a different consumer broadband loop revenue amount than $42 per loop per month. First, when a carrier's consumer broadband loop revenue requirement is less than $42 per loop per month, CAF BLS will only impute the actual consumer broadband loop revenue requirement. For example, if a carrier has 1,000 consumer broadband-only loops with an average cost of $41 per month, its imputed annual revenue would be $492,000 ($41 * 1,000 * 12), rather than $504,000 ($42 * 1,000 * 12). Without this exception, consumer broadband loops could create “negative” CAF-BLS amounts for some carriers in its initial calculation. The effect of the negative CAF-BLS amounts would be to reduce overall CAF BLS and require above-cost consumer broadband rates to replace lost CAF BLS that would otherwise subsidize voice loops. This exception will prevent a cross-subsidy of voice service by consumer broadband-only service that may not otherwise be necessary.
81. The second exception is that, solely for the purpose of calculating true-ups, CAF BLS will impute the consumer broadband rate the carrier was permitted to charge, if it is higher than the amount that would be imputed otherwise. For example, if a carrier had 1,000 loops and, as a result of the operation of the budgetary constraint, its consumer broadband loop rate was $43 per month, the annual revenue imputation would be $516,000 ($43 * 1,000 * 12), rather than $504,000. Using actual revenues for true-ups in this way will recognize additional revenue that the carrier would have received and prevent duplication of cost recovery between CAF BLS and special access rates. This will result in a carrier having imputed consumer broadband-only revenue that exceeds its consumer broadband-only revenue requirement, but that is necessary to ensure that both its interstate common line revenue requirement and its consumer broadband loop revenue requirement are met even when the budgetary constraint is applied.
82.
83. Consistent with the general approach submitted by the industry associations, operating expense costs will be limited by comparing each study area's opex cost per location to the regression model-generated opex per location plus 1.5 standard deviations. The regression formula to be used is as follows:
84. The Commission does not agree with commenters who argue that they should only limit operating expenses for carriers with costs above the two standard deviations. Indeed, the Commission notes that using two standard deviations would subject only an estimated 17 study areas to an opex limit. The Commission concludes that using 1.5 standard deviations—which they estimate, based on last year's data, would have impacted roughly 50 carriers—more appropriately advances the Commission's goal of providing better incentives for carriers to invest prudently and operate more efficiently. Because any support reductions associated with this limit will then be available to other rate-of-return carriers, our budget for high-cost support should enable more broadband deployment than if the Commission continued funding excessive operating expenses for certain companies at current levels.
85. The Commission declines to set different limits based on the separate density categories initially proposed by the industry because density is already taken into account as a variable in the regression analysis. The Commission sees no legal or economic justification for modifying the allowable opex expense a second time. Using density again in this fashion has the effect of arbitrarily raising the allowable opex expense limit for some rural carriers at the direct expense of the other carriers serving high-cost areas that are nearly as sparsely populated. Moreover, even if the Commission were inclined to do so, the proponents of this approach have failed to explain in the record why it would be appropriate to draw the line at 1.5 locations per square mile, as opposed to 2 locations per square mile, 4 locations per square mile, or some other figure. Therefore, the Commission adopts a uniform standard deviation formula for purposes of setting a limit based on the regression results.
86. In addition, unlike the industry's original proposal, the Commission includes corporate expenses (calculated according to the current limitation) within the regression. These expenses are a significant portion of carrier operating expenses, and the Commission concludes that they should be subject to limitation as well. Indeed, corporate expenses alone account for approximately 15 percent of the total costs assigned to the loop for rate-of-return cost companies. Moreover, the Commission is concerned that leaving corporate expenses outside of this overall limitation will provide an opportunity for inappropriate cost shifting from an account where they are above the limit to an account where they are below the limit.
87. NTCA has argued that “reasonable transitions” are necessary when implementing limitations on support. The Commission concludes that a transition is appropriate to allow carriers time to adjust their operating expenditures. Therefore, the Commission concludes that for the first year in which the opex cap is implemented, the eligible operating expense of those carriers subject to the cap will be reduced by only one-half of the percentage amount determined by the regression methodology. For example, if the regression methodology determines that a carrier's eligible operating expense should be reduced by 10 percent for the first year in which the opex cap is implemented, then each account used to determine that carrier's eligible operating expense shall be reduced by only 5 percent. However, in all subsequent years, the carrier's eligible operating expense shall be reduced by the full percentage amount determined by the regression methodology.
88. Within 30 days of the effective date of this Report and Order, the Commission directs NECA to submit to USAC a schedule of companies subject to limits under the adopted formula. The Commission directs NECA to exclude data for Alaska carriers when making these calculations. The Commission also directs NECA to provide USAC with the dollar amount of reductions in HCLS and CAF-BLS to which each carrier subject to limits under the adopted formula will be subject. USAC shall validate all calculations received from NECA before making disbursements subject to any such support reductions.
89.
90. First, the Commission uses the TALPI as the basis for calculating loop plant investment limitations for both HCLS and CAF-BLS, not just for HCLS. To ensure the most efficient use of limited universal service resources, the capital budget limitation must apply to HCLS, which supports the intrastate portion of the exchange loop, and CAF-BLS, which supports the interstate portion. Second, the Commission modifies the investment categories proposed by the associations to determine a carrier's TALPI so that they correspond to those used to determine a carrier's HCLS and CAF BLS. The Commission notes that a small number of carriers have not provided this information in the past. Carriers that do not provide study area level cost studies to NECA will have to provide USAC with data from the relevant categories and accounts. Amounts in excess of a carrier's AALPI will be removed from the relevant categories or accounts either on a direct basis when the amounts of the new loop plant investment can be directly assigned to a category or account, or on a pro-rata basis according to each category or account's proportion to the total amount in each of the above categories and accounts when the new loop plant cannot be directly assigned.
91. Third, the Commission refines the AALPI adjustment for areas covered by a pre-existing loan. The Commission concludes that the AALPI should only be adjusted for areas covered by a pre-existing loan for which a previously planned loan disbursement has been made and that loan disbursement was used to increase the annual loop expenditure for the year, or years, in which the AALPI adjustment is taken. The Commission makes this modification because an outstanding loan does not
92. Fourth, rather than adjusting the AALPI by only one half of a percentage point for every percentage point that a carrier's deployment differs from the target availability, the Commission adjusts the AALPI by one percentage point. The Commission finds that an adjustment of only one half of a percentage point will not have a sufficient impact to moderate expenditures by companies that are above average, and also will not provide a sufficient opportunity to catch up to those carriers that must increase their deployment. An increase of one percentage point will allow those carriers that must catch up to the target availability more funds with which to do so.
93. Within 30 days of the effective date of this Report and Order, and for each subsequent quarterly or annual data reporting period, the Commission directs NECA to submit to USAC the following information for each study area:
94. USAC shall validate all calculations received from NECA before making disbursements subject to any support reductions due to the Capital Investment Allowance.
95. In this section, the Commission takes further steps to target high-cost support efficiently to those areas that will not be served by private sector investment alone. First, the Commission prohibits rate-of-return carriers from receiving CAF BLS in areas that are served by a qualifying unsubsidized competitor. Second, the Commission adopts a challenge process to determine which areas are served by unsubsidized competitors building on proposals submitted in the record. Third, as proposed by several commenters, the Commission adopts several options to disaggregate support in areas determined to be served by qualifying competitors: Carriers will be free to elect one of several mechanisms to disaggregate their support. Fourth, the Commission adopts a phased reduction in disaggregated support for competitive areas, as suggested by USTelecom and NTCA. The net result of these changes will be to more effectively target CAF BLS to areas where support is needed to ensure consumers are served with voice and broadband services.
96.
97. To ensure that high-cost universal service support is used efficiently, consistent with the intent of providing universal service where it otherwise would be lacking, the Commission now adopts a rule to eliminate CAF BLS in competitive areas. Building on proposals submitted in the record by NTCA and USTelecom, and taking into account our experience implementing similar requirements in price cap areas and the 100 percent overlap rule in rate-of-return areas, a census block will be deemed to be “served by a qualifying competitor” for this purpose if the competitor holds itself out to the public as offering “qualifying voice and broadband service” to at least 85 percent of the residential locations in a given census block. For purposes of meeting the requirement to “offer” service, the competitor must be willing and able to provide qualifying voice and broadband service to a requesting customer within ten business days.
98. The first step in implementing such a rule is to conduct a process to determine which census blocks are competitively served. The Commission now adopts a challenge process building on lessons learned from both the challenge process utilized to finalize the offer of Phase II model-based support to price cap carriers and the process used to implement the 100 percent overlap rule for rate-of-return carriers. Under this process, the Bureau will publish a Public Notice with a link to a preliminary list of competitors serving specific census blocks according to FCC Form 477 data. As suggested by NTCA and USTelecom, in order for a challenge for a particular census block to go forward, those competitors will be required to certify that they are offering service to at least 85 percent of the locations in the census block, and must provide evidence sufficient to show the specific geographic area in which they are offering service. If they fail to submit such information in response to the Bureau's Public Notice, the block will not be deemed competitively served. To the extent the competitor provides the required filing in response to the Bureau's Public Notice, incumbents and any other interested parties such as state public utility commissions and Tribal governments will have the opportunity to contest those assertions. The ultimate burden of persuasion will rest on the competitor to establish that it offers service to at least 85 percent of the locations in the census block, based on all the evidence in the record. The challenge process will be conducted by the Bureau as set forth more fully below.
99. The Bureau will rely on Form 477 broadband deployment data to make the preliminary determination of which census blocks are served by providers offering broadband service. The Form 477 data collection is mandatory, and Form 477 filers must certify to the accuracy of their data. The Commission directs the Bureau to utilize the most recent publicly available data at the time it releases the initial Public Notice.
100. To be considered an unsubsidized competitor in a given census block, a fixed broadband provider must offer service in accordance with the Commission's current service obligations on speed, latency, and usage allowances. In December 2014, the Commission adopted a new minimum speed standard for carriers receiving high-cost support: They must offer actual speeds of at least 10/1 Mbps. Therefore, the Commission directs the Bureau to use 10/1 Mbps as the threshold for determining competitors when developing the preliminary list for the initial implementation of this rule.
101. The Commission is not persuaded by NTCA's proposal that the Commission utilize the current section 706 speed benchmark, at least 25 Mbps downstream and 3 Mbps upstream (25/3 Mbps), as the basis to identify locations where a competitor is present. Although the Commission has determined that 25/3 Mbps reflects “advanced” capabilities, the Commission has explained that “[b]y setting a lower baseline for Connect America funding, they establish a framework to ensure a basic level of service to be available for all Americans, while at the same time working to provide access to advanced services. The areas served by rate-of-return carriers encompass “many rural and remote areas of the country.” Similarly, the Commission is not persuaded by WTA's proposal that a competitor must be offering service with speeds at least as high as the highest speed service offering of the incumbent in order to be deemed a qualifying competitor. The Commission finds that using a 10/1 Mbps threshold at the present time for identification of competitors is consistent with the Commission's section 254 goal of ensuring that universal service funding is used in the most efficient and effective manner to provide consumers in rural and high-cost areas of the country with voice and broadband service.
102. The Commission currently does not collect comprehensive, block-level data on broadband latency or monthly usage allowances, as it does for broadband speed. However, data collected by the Commission through the Measuring Broadband America program suggest that the latencies associated with most fixed broadband services are low enough to allow for real time applications, including Voice over Internet Protocol. In addition, data from the Commission's urban rate survey indicate that many fixed broadband providers offer unlimited data usage or usage allowances well in excess of the 150 GBs per month that they now establish as our baseline requirement for purposes of implementing the competitive overlap rule. Therefore, the Commission concludes it is reasonable to presume that providers meeting the speed criteria also meet the latency and usage-allowance criteria, for purposes of preparing the preliminary list.
103. This is similar to the approach taken by the Bureau in the Connect America Fund Phase II challenge process. One of the lessons learned from the Phase II challenge process was that no party was able to demonstrate high latency by competitors, and very few providers prevailed in a challenge exclusively focused on a competitor's usage/price. This provides us with confidence that, as a general matter, it is reasonable to assume, for purposes of preparing the preliminary list, that a provider that in fact is in the area providing the requisite speed is also meeting the latency and usage requirements.
104. Under our existing rule, to be considered an unsubsidized competitor, a provider must be a facilities-based provider of residential fixed voice service, as well as fixed broadband. Form 477 provides the best data available on whether broadband providers also offer fixed voice service, but the data are not reported at the census block level. Therefore, to determine whether a broadband provider also offers voice service, for purposes of preparing the preliminary list, the Bureau will assume if a broadband provider reported any fixed voice connections in a state in its Form 477 filing, then it offers voice service throughout its entire broadband service area in that state. The Commission notes that in order to file Form 477, a VoIP provider must be offering interconnected VoIP, which means that the provider is required to provide E911 and comply with CALEA, among other things.
105. The Commission will exclude competitive Eligible
106. Once the preliminary list is published, the next step in the process will be for identified competitors to confirm that they are in fact offering voice and broadband service within the specific census block where they report broadband deployment on FCC Form 477. Based on the Phase II challenge experience, the Commission has learned that it is extremely difficult for an incumbent provider to prove a negative—that a competitor is not serving an area. Rather, the purported competitor is in a much better position to confirm that it is offering service in a given area.
107. Upon publication of the preliminary list, there will a comment period in which competitors must certify that they offer both voice and broadband meeting the requisite requirements in a particular census block in order for that block potentially to be subject to a competitive overlap determination. Specifically, as suggested by several parties, they must offer: (1) Fixed voice service at rates under the then applicable reasonable comparability benchmark, and (2) fixed terrestrial broadband service with actual downstream speed of at least 10 Mbps and actual upload speed of at least 1 Mbps; with latency suitable for real time applications, including Voice over Internet Protocol; with usage capacity that is reasonably comparable to offerings in urban areas; and at rates that are reasonably comparable to those in urban areas. To the extent the competitor is meeting the voice service obligation through interconnected VoIP, it will already be subject to requirements for E911 and CALEA, as noted above. The Commission also requires that the competitor be able to port telephone numbers in that census block, as suggested by several commenters. In order to make this certification, a competitor must have hold itself out to the public as offering service to at least 85 percent of the locations in the census block, and be willing and able to provide service to a requesting customer within ten business days. For purposes of this certification, the number of locations shall be based on the most recently available U.S. Census data regarding the number of housing units in a given census block. The Commission notes that our existing rule defines an unsubsidized competitor as a provider of fixed
108. If the competitor fails to submit such a certification and any evidence, the block will be deemed non-competitive, and there will be no need for the incumbent to respond. If, however, the competitor submits the requisite certification that it is offering both qualifying voice and qualifying broadband service in the census block, with supporting information identifying with specificity the geographic areas served, the Commission will then accept submissions from the incumbent or other interested parties seeking to contest the showing made by the competitor. Examples of information that may be persuasive to establish that service is not being offered includes evidence that a provider's online service availability tool shows “no service available” for customers in the geographic area that the carrier certifies it serves or filings from consumers residing in the geographic area that the competitor has certified is served that they were unable to obtain service meeting the specified requirements from the purported competitor within the relevant time frame.
109. Consistent with the approach taken in the Phase II challenge process, the Commission will not consider any additional evidence or submissions filed by any party after the deadline for reply comments, absent extraordinary circumstances. The Commission thus adopts a procedural requirement that competitive overlap submissions for both purported competitors and incumbents must be complete as filed. After the conclusion of the comment cycle, the Bureau will make a final determination of which census blocks are competitively served, weighing all of the evidence in the record. The Commission delegates authority to the Bureau to take all necessary steps to implement the challenge process they adopts today.
110. The Commission is not persuaded by arguments that it may be premature for the Commission to implement a competitive overlap rule prior to full implementation of the 100 percent overlap rule. The Commission has learned a great deal through developing and implementing both the Phase II challenge process for price cap areas and the 100 percent overlap process. The Commission is adopting a challenge process that builds on lessons learned from both experiences. The Commission concludes that utilizing the procedural requirements adopted for the Phase II challenge process, coupled with putting the burden of proof on the competitor to establish that it serves a census block, will best meet the Commission's objectives for ensuring that support is not provided in areas where other providers are providing service without subsidies.
111. The Commission is not persuaded that it should require competitors to certify they serve 100 percent of the locations in a given census block in order for that census block to be considered “served.” Our experience with the implementation of the 100 percent overlap rule shows that such a standard will rarely, if ever be met, even though there may be a significant degree of competitive overlap. The Commission concludes that adopting an evidentiary showing that the competitor must certify that it serves 85 percent or more—a substantial majority—of residential locations in a census block are served strikes the right balance between the approach used in
112. The Commission also declines to impose other requirements suggested in the record by WTA, such as requiring a competitor to have an interconnection agreement with the incumbent, be subject to section 251, offer Lifeline, own or lease all of the facilities needed to deliver service, not receive any other forms of federal or state support, including universal service support other than Lifeline, not charge any fees for site visits to determine if service can be provided, even if that fee is credited upon service installation, and comply with state service quality and other regulatory requirements applicable to the incumbent for voice service. WTA fails to provide any explanation of the policy rationale for each of these proposals, many of which seem intended to subject the competitor to the same regulatory requirements as the incumbent. In any event, the net result of these proposals would be to ensure that no entity ever could qualify as an unsubsidized competitor. Nor is the Commission persuaded by WTA's argument that only future new investment should be subject to a competitive overlap rule, and that no support should be reduced for existing investments. The Commission notes that they only are disaggregating and reducing CAF BLS in areas found to be served by unsubsidized competitors, rather than both HCLS and CAF BLS, which will lessen the impact of this rule on affected carriers.
113. As suggested by NTCA and USTelecom, the Commission will conduct the competitive overlap challenge process outlined above every seven years. This will ensure that the Commission periodically revisits the competitive overlap analysis, but not impose excessive burden on incumbents, potential competitors, or Commission staff. Re-examining the extent of competitive overlap in this time frame will provide stability and consistency for all interested stakeholders.
114. Upon the completion of the competitive overlap determination, the Commission concludes that carriers should be able to select one of several methods to disaggregate support between competitive and non-competitive areas, as suggested by several commenters. The Commission notes that the Commission took a similar approach when it allowed incumbents to disaggregate ICLS in 2001, allowing carriers to select one of several disaggregation paths subject to general parameters established by the Commission. The Commission agrees with commenters that they should utilize a disaggregation mechanism that ensures that sufficient support is provided to those areas where the incumbent is the sole provider of voice and broadband, and the Commission recognizes that competitive areas are likely to be lower cost and non-competitive areas are likely to be relatively higher cost. The Commission therefore adopts a rule to permit carriers, on their own election, to utilize one of the following methods suggested by commenters to disaggregate their CAF BLS between competitive and non-competitive areas. Providing carriers options will enable each carrier the flexibility to determine which approach best reflects the unique characteristics of their service territory. First, carriers may choose to disaggregate their CAF BLS based on the relative density of competitive and non-competitive areas. Second, carriers may choose to disaggregate their CAF BLS based on the ratio of competitive to non-competitive square miles in a study area, as proposed by Hargray. Third, carriers may choose to disaggregate their CAF BLS based on the ratio of A-CAM calculated for competitive areas compared to A-CAM support for the study area. The Commission outlines each of these disaggregation mechanisms below.
115. Consistent with the approach previously taken by the Commission for disaggregation of support, total support in a study area shall not exceed the support that otherwise would be available in the study area absent disaggregation. Similar to the former disaggregation rule, the Commission may, on its own motion, or in response to a petition from an interested party, examine the results of any one of the adopted disaggregation methods to ensure that it fulfills the Commission's intended objectives.
116. Carriers may choose to disaggregate their CAF BLS based on a methodology using the density of competitive and non-competitive areas, as proposed by NTCA/USTelecom. In particular, this method allocates the revenue requirement between competitive and non-competitive areas, based on the relative density of competitive and non-competitive areas. As explained by NTCA/USTelecom, “[t]he ratio of the calculated non-competitive area's revenue requirement to the sum of the calculated competitive and non-competitive revenue requirements is applied to the study area's actual revenue requirements to ensure the total actual revenue requirement is equal to the sum of the competitive and non-competitive areas' revenue requirements.”
117. The allocation between competitive and non-competitive areas is achieved by calculating a separate cost per loop for competitive and non-competitive areas based on the differing densities of the competitive and non-competitive areas. To calculate the disaggregated revenue requirements using these costs per loop, each cost per loop is multiplied by the number of loops in the corresponding (
118. Carriers may also may choose to disaggregate their CAF BLS using a ratio of competitive to non-competitive square miles in a study area, as proposed by Hargray. Lower-cost areas are generally lower cost because of the presence of a dense cluster of consumers, which causes the cost per loop to be lower. Hargray submitted analysis into the record showing how support is reduced in a non-linear manner based on the rate of decline that would be expected if it were possible to specifically capture the loops and costs associated with non-competitive areas. As competitive overlap in a study area increases, utilizing this method CAF BLS would be reduced in a non-linear manner that accelerates as competitive overlap reaches 100 percent. In particular, under this disaggregation method, support would be reduced using the following schedule:
119. By utilizing this mechanism, carriers would not be required to undertake steps to ensure the accuracy of location data or undertake a census block by census block determination of density. Therefore, by selecting this mechanism, carriers will enjoy relative ease of administration.
120. As a third option, the Commission will permit carriers subject to a reduction in support for competitive overlap to elect to utilize an allocation derived from the A-CAM, as suggested by NTCA. In this Order, the Commission adopts a forward-looking cost model that has been modified for use to determine support amounts for rate-of-return carriers that voluntarily elect to receive universal service support. As the Commission explained, the A-CAM contains a support module, which calculates support on a per-location basis based on its calculation of the costs to serve the locations in every census block. For purposes of the voluntary offer of model-based support, support is only calculated for blocks that are not served by an unsubsidized competitor. The support module can be adjusted, however, to calculate support for the blocks that are competitively served, as well. Thus, support can be divided at the study area level between competitive and non-competitive census blocks. This ratio can be applied to CAF-BLS support to disaggregate support for competitive areas. The Commission notes that competitively served census blocks are likely to be the lower cost, more densely populated portions of the study area, in many instances where the model calculates little or even no support. In such cases, a carrier electing this method would see little to no support reduction using the A-CAM allocator, because the model provides support only for the higher cost areas.
121. The Commission agrees with commenters that support reductions associated with competitive areas should be phased in. As suggested by USTelecom and NTCA, the Commission adopts the following transition for reductions in CAF BLS in areas that are deemed to be competitively served: Where the reduction of CAF BLS from competitive census block(s) represents less than 25 percent of the total CAF BLS support the carrier would have received in the study area in the absence of this rule, disaggregated support associated with the competitive census blocks will be reduced 33 percent in the first year, 66 percent in the second year, with that support associated with the competitive census blocks fully phased-out by the beginning of the third year. Where the reduction of CAF BLS from competitive census blocks represents more than 25 percent of the total CAF BLS support the carrier would have received in the study area in the absence of this rule, disaggregated support associated with the competitive census blocks will be reduced 17 percent in the first year, 34 percent in the second year, 51 percent in the third year, 68 percent in the fourth year, 85 percent in the fifth year, and fully phased-out by the beginning of the sixth year. The Commission also emphasizes that carriers affected by implementation of this rule are free to seek a waiver of support reductions under our existing precedent.
122. The Commission previously adopted an overall budget of $4.5 billion for the high-cost program, and a budget within that amount of $2 billion per year for high-cost support for rate-of-return carriers. It did not, however, adopt a method for enforcing the budget for rate-of-return carriers. The Commission now adopts a self-effectuating mechanism for controlling total support distributed pursuant to HCLS and CAF BLS to stay within the budget for rate-of-return carriers.
123. The components of the high-cost program other than those for rate-of-return carriers are structured in a fashion that ensures each stays within its respective portion of the $4.5 billion budget. Because ICLS and CAF ICC are not capped, there is no mechanism today to keep disbursements of high-cost funds to rate-of-return carriers within that $2 billion budget. Indeed, NECA forecasts that over the next several years, absent any further reforms, total high-cost support (that is, the sum of HCLS, ICLS, and CAF ICC) for the rate-of-return industry will exceed the $2 billion budget. It therefore is imperative that the Commission takes further steps now to ensure the budget is not exceeded, in the event growth in CAF BLS were to cause total rate-of-return support to exceed the defined budget. Adopting an overall budget control mechanism will provide a predictable and reliable method in the event that demand exceeds the available budget. The Commission notes, of course, that the budget control will only be implemented in the event total support is forecasted to exceed the budget in a given year.
124. In implementing measures to stay with the previously adopted budget, the Commission notes that the Tenth Circuit has affirmed the Commission's decision to set the rate-of-return budget at $2.0 billion. The court found reasonable the Commission's determination “that budgetary sufficiency for . . . rate-of-return carriers could be achieved through a combination of measures, including but not limited to: (1) Maintaining current USF funding levels while reducing or eliminating waste and inefficiencies that existed in the prior USF funding scheme; (2) affording carriers the authority to determine which requests for broadband service are reasonable; (3) allowing carriers, when necessary, to use the waiver process; and (4) conducting a budgetary review by the end of six years.” In this Order, the Commission retains each of these measures to safeguard the sufficiency of the budget. Though some parties have suggested in general terms that the budget should be increased, they have not provided the type of detailed information about why the overall budget is insufficient for the Commission to meet its goal of achieving universal service, nor have they presented individualized circumstances necessary to evaluate their claims. As discussed below, any carrier may seek waiver if it is necessary and in the public interest to ensure that consumers in the area continue to receive service.
125.
126.
127. Our budget control mechanism, as described in detail below, will be applied to forecasted disbursements each quarter. For this purpose, forecasted disbursements include payments made for HCLS, payments for CAF BLS based on forecasted data for current period, and true-ups associated with prior years but being disbursed during the current period. There will be no retroactive application of the budget control mechanism.
128. First, a target amount is identified for each mechanism—HCLS and CAF BLS—so that in the aggregate disbursements for the mechanisms equal the budgeted amount for rate-of-return carriers. This targeted amount is calculated by multiplying the forecasted disbursements for each mechanism by the ratio of the budgeted amount to the total calculated support for the mechanisms. In this case, disbursements include CAF BLS provided on a projected basis, as well as true ups of that mechanism that apply to prior periods. This target amount will be calculated for each mechanism once per year prior to the annual filing of the tariffs.
129. The reduction of support under each mechanism will be split between a per-line reduction and a pro rata reduction applied to each study area. The per-line reduction will be calculated by dividing one half the difference between the calculated support and the target amount for each mechanism by the total number of eligible loops in the mechanism. Because some study areas may have per-line support amounts that are less than the per-line reduction, the per-line reductions as applied may not precisely equal one-half the difference between the calculated support and the target amount. In that case, the remaining reductions will be achieved through the pro-rata reduction. The pro rata reduction will then be applied as necessary to achieve the target amount. For CAF-BLS, the per-line and pro rata reductions will calculated once per year, prior to the annual filing of tariffs. For HCLS, the per-line and pro rata reductions will be calculated quarterly, using the most recently announced target amount.
130.
131.
132. In this section, the Commission takes steps to promote “accountability from companies receiving support to ensure that public investments are used wisely to deliver intended results.” Specifically, the Commission adopts specific, defined deployment obligations that are a condition of the receipt of high-cost funding for those carriers continuing to receive support based on embedded costs. These measures will help ensure that “[c]onsumers in all regions of the Nation . . . have access to telecommunications and information services . . . that are reasonably comparable to those services provided in urban areas.” The Commission notes that USTelecom and NTCA recognize that defined buildout obligations are “essential to a broadband reform effort.”
133.
134. The Commission concludes that it now is time to establish defined deployment obligations for every carrier to ensure it has a framework to achieve our goal of universal service. As noted above, ETCs are currently required to “describe with specificity proposed improvements or upgrades” to their network throughout their service area in their five-year plans.” The Commission did not specify specific numerical targets for those five-year plans, however, which has hampered our ability to judge whether carriers are in fact taking reasonable steps to extend broadband service. The Commission notes that although many rate-of-return carriers have aggressively deployed broadband service within their study areas, that progress has not been evenly distributed. Indeed, while some carriers have deployed 10/1 Mbps service to 99-100 percent of the census blocks within their study areas, other carriers have not deployed to any.
135. Given the lack of any deployment by some providers and extremely low levels of deployment by others, the Commission concludes that some concrete standards for deployment are necessary to achieve the Commission's goal of extending broadband to those areas of the country where it is lacking. Indeed, the Commission has seen little to no progress in deployment since the
136. To ensure that universal service support is utilized as effectively as possible in furtherance of the Commission's goal to achieve universal service, the five-year plan must operate as a meaningful tool for Commission oversight and possess quantifiable objective goals that can be easily measured and monitored. In this Order, the Commission has replaced ICLS with Broadband Loop Support so that all rate-of-return carriers can receive support for broadband-only lines. The Commission is eager to see that this support results in more widespread deployment. Moreover, in this Order, the Commission sets allowances for capital expenses, which will result in a larger budget for carriers whose deployment is less than the national average. However, that reform, by itself, does not guarantee that a carrier will make the investments needed to connect unserved consumers. Accordingly, in conjunction with our adoption of the updated CAF-BLS mechanism and capital expense allowances, the Commission adopts refinements to the current five-year plan requirements designed to increase accountability and ensure the extension of broadband to those areas of the country where it is lacking. In particular, the Commission adopts a specific methodology to determine each carrier's deployment obligation over a defined five-year period, which will be used to monitor carrier performance.
137.
138. Under the first step in this methodology, the Commission will develop a five-year forecast of the total CAF-BLS support for each rate-of-return carrier, which will include support for stand-alone broadband loops. The Commission directs NECA to prepare forecasts utilizing these assumptions in consultation with the Bureau and submit them to USAC within 60 days of the effective date of this Order. USAC is directed to validate any calculations submitted by NECA to ensure they are accurate and reflect the specified assumptions. The Commission agrees with commenters that knowing the level of anticipated support is helpful when developing any associated deployment obligations. Therefore, the Commission is confident that basing the new deployment obligation on a support forecast will give carriers the relative certainty they desire in their support going forward, allowing them to plan new investment. The Commission notes that if a carrier's CAF BLS is subsequently reduced based on the implementation of competitive overlap rule adopted above, USAC will then recalculate that carrier's deployment obligation based on a revised forecast of that carrier's CAF BLS. Carriers cannot use locations in areas determined to be competitive based on the competitive overlap determination to meet their deployment obligation.
139. Each rate-of-return carrier that continues to receive support based on the reformed legacy mechanisms will be required to target a defined percentage of its five-year forecasted CAF-BLS support to the deployment of broadband service where it is currently lacking. The percentage of support will be determined on a carrier-by-carrier basis for a five-year period. Specifically, consistent with the framework suggested by the rural associations, rate-of-return carriers with less than 20 percent deployment of 10/1 Mbps broadband service in their entire study area, based on June 2015 FCC Form 477 data, will be required to utilize 35 percent of their five-year forecasted CAF-BLS support specifically for the deployment of 10/1 Mbps broadband service where it is currently lacking. Rate-of-return carriers with more than 20 percent or greater but less than 40 percent deployment of 10/1 Mbps broadband service in their entire study areas, will be required to utilize 25 percent of their five-year forecasted CAF-BLS support specifically for the deployment of broadband service where it is currently lacking. Rate-of-return carriers with 40 percent or greater but less than 80 percent deployment of 10/1 Mbps broadband service in their entire study areas, will be required to utilize 20 percent of their five-year forecasted CAF-BLS support specifically for the
140. Deployment obligations will then be determined by dividing the dollar amount of the targeted CAF BLS by a cost-per-location figure. First, the Bureau will prepare a list of all rate-of-return carriers with at least 95 percent deployment of 10/1 Mbps broadband service within their study areas, based on the most recent publicly available FCC Form 477 data. The Commission believes it is reasonable to assume that if a rate-of-return carrier is nearly fully deployed with 10/1 Mbps broadband service, the carrier has recently upgraded its network and its current cost per loop is a reasonably good proxy for the cost per line associated with extending 10/1 Mbps broadband. The Bureau will sort the carriers into a number of groups based on the density of housing units per square mile, utilizing publicly available U.S. Census data. Any carriers subject to the current $250 per line per month cap and the newly adopted opex limits will be excluded from the analysis. The Bureau also may exclude any carrier whose costs appear to be an outlier within a given density grouping. Then, USAC will determine the weighted average cost per loop for the carriers that are 95 percent or greater deployed for each density grouping, based on NECA cost data. Carriers with 95 percent or greater deployment of 10/1 Mbps broadband are likely to have deployed broadband relatively recently, so the average should be generally reflective of the cost that carriers have incurred to upgrade their networks. The Commission finds that this process is reasonable because a carrier's weighted average cost per loop is based on its particular density grouping, thus taking into account costs for similarly-situated carriers. USAC also will determine the weighted average of the cost per loop for carriers in the same density band with a similar level of deployment, and then will increase that figure by 150 percent. This is similar to the approach advocated by NTCA and USTelecom, who suggested that the Commission use a figure that is “at least 150 percent of the average cost per loop” of those carriers with comparable density and deployment. It is reasonable to assume that many of the locations left unserved will have costs higher than the current average cost per loop, which by definition averages the lowest cost and the higher cost locations. Given that the carriers subject to the defined deployment are those that have deployed 10/1 Mbps broadband to less than 80% of their locations, it also is reasonable to assume that they would choose to meet their deployment obligations by extending service to their least costly unserved locations, and not the most expensive unserved locations. Therefore, the Commission concludes that a 150 percent increase above the weighted average cost per loop of companies with similar density and deployment levels is a reasonable approach that takes into account that costs will likely higher when carriers extend broadband into unserved areas.
141. If the 150 percent of the weighted average of companies with similar density and deployment is greater than the figure derived from companies of similar density that have deployed to 95 percent or more of locations, that larger figure will be the cost per location metric used to size the obligation to deploy 10/1 Mbps broadband service. USAC then will divide each carrier's specific five-year forecasted CAF-BLS support amount by the specific embedded cost per location figure. The quotient of this calculation will result in the exact number of locations a carrier electing this option is required to deploy 10/1 Mbps broadband service to pursuant to its five-year plan.
142. As an alternative to the approach outlined above, carriers may elect to have their deployment obligations determined based on the cost per loop for that carrier as reflected in the adopted version of the A-CAM, as suggested by NTCA and USTelecom. For this purpose, the relevant figure will be the calculated cost for those census blocks that are unserved with 10/1 Mbps, using the cost module. USAC will divide each carrier's specific five-year forecasted CAF-BLS support amount by the A-CAM calculated, carrier specific, average cost per loop for unserved areas. The quotient of this calculation will result in the exact number of locations a carrier electing this option is required to deploy 10/1 Mbps broadband service to pursuant to its five-year plan.
143.
144. The Commission concludes that rate-of-return carriers with 80 percent or greater deployment of 10/1 Mbps broadband service in their entire study areas, as determined by the Bureau based on June 2015 FCC Form 477 data, will not have specific buildout obligations as a condition of receiving CAF-BLS support. However, those carriers must continue to deploy 10/1 Mbps or better broadband service where cost-effective and utilize alternative technologies where terrestrial wireline infrastructure is too costly, and report, as part of their annual Form 481 filing, progress on the number of locations where 10/1 Mbps or better broadband service have been deployed within their study area in the prior calendar year. The Commission emphasizes that any CAF-BLS funding earmarked for the purpose of extending 10/1 Mbps service to census blocks lacking such service may not be used to improve speeds for those locations to which 10/1 Mbps service has already been deployed. The Commission will continue to monitor the deployment progress of these carriers: They may revisit this framework in the future if such carriers do not continue to make reasonable progress on extending broadband.
145. The Commission concludes that carriers subject to a defined five-year deployment obligation may choose to meet their obligation at any time during the five-year period. For example, a carrier can evenly space out construction to targeted locations on an annual basis or complete all of its required deployment within a single year. However, should any carrier subject to a defined five-year deployment obligation fail to complete the deployment within the stipulated five-year period, the carrier is potentially subject to reductions in support pursuant to section 54.320(c) of the Commission's rules, to be determined on a case-by-case basis. In situations where the carrier makes no progress towards meeting its defined five-year deployment obligation, and fails to establish extenuating circumstances, the Commission reserves the right to include such census blocks in an upcoming auction.
146. The Commission recognizes that even after the conclusion of the initial five-year period, additional efforts will be necessary “to encourage continued investment in broadband networks throughout rural American to ensure that all consumers have access to reasonably comparable services at reasonably comparable rates.” Therefore, the Commission concludes that carriers with less than 80 percent deployment of broadband service meeting then-current standards in their study areas will be required to utilize a specified percentage of their five-year forecasted CAF BLS to deploy broadband service meeting the Commission's standards where it is lacking in subsequent five-year periods. The same methodology will be used, with USAC updating the average cost per loop amounts, based on the then-current NECA cost data, and the Bureau updating the density groupings and percentage of deployment figures, as appropriate.
147. The Commission concludes that the approach outlined above improves on the proposal initially submitted by NTCA, USTelecom, and WTA that rate-of-return carriers in receipt of BUSS support utilize at least 10 percent of their support “toward the goal of delivering broadband at the then-current 706 broadband speed to `4/1[Mbps] Unserved Locations.' ” The associations' earlier proposal failed to include any quantifiable deployment objectives, making it an ineffective tool for Commission oversight. Moreover, the Associations' proposal placed too much emphasis on achieving the deployment of advanced telecommunications capability, rather than the standards that the Commission has established as its minimum expectation for universal service. The Commission notes that USTelecom and NTCA more recently indicated their support for the framework adopted in this Order. To ensure that universal service support is used as effectively as possible to close the rural-rural divide, the Commission must be able to measure and monitor the deployment objectives outlined in a carrier's five-year plan. As noted above, deployment has not been consistent across all rural areas. Therefore, it is critical that the Commission have a method to evaluate progress towards meeting the established minimum 10/1 Mbps standard for high-cost support in each study area and determine if remedial action is warranted.
148. On an ongoing basis, the Commission will assess broadband deployment progress for all rate-of-return carriers based on carriers' annual reporting on the progress of their broadband deployment, and make adjustments, where warranted.
149.
150. The Commission also takes further action to implement the existing reasonable request standard to ensure that consumers in remote areas are served. The Commission previously sought detailed comment on implementation of the Remote Areas Fund, including the option of using a competitive process to award support for such areas. Carriers will be invited later this year to identify those census blocks where they do not anticipate being able to deploy service under the existing reasonable request standard (
151. The Commission notes that should a carrier choose to place census blocks in the next Commission auction and another entity is authorized to receive support for those census blocks to provide voice and broadband service subsequent to the auction, the incumbent will not be subject to the reasonable request standard and no longer will receive support for those areas.
152. The adoption of the voluntary path to the model, coupled with our update to the existing ICLS mechanism to provide support for broadband-only loops, should be beneficial to carriers that are high-cost, but no longer receive HCLS support due to the so-called “cliff effect.” The Commission notes that the revenue benchmark they set for broadband-only loops is lower than the effective benchmark for HCLS, which only provides support for carriers with an average loop cost of at least 115 percent of the frozen NACPL. Because the NACPL is frozen at $647.42, a carrier only receives HCLS if its average cost per loop on an annual basis is higher than $744.53, or $62.04 per month. Thus, our reformed CAF-BLS mechanism will provide cost recovery for broadband-only loops for many carriers that no longer are eligible for HCLS support. This is one of the reasons why the Commission concludes that over the long run, CAF BLS will be more sustainable and equitable than HCLS and the former ICLS, supporting new broadband deployment to areas where providers have been unable to build absent some subsidy.
153. The Commission will monitor the progress in broadband deployment under the strengthened requirements for broadband deployment and may take further action in the future should it appear that despite these reforms, some high-cost areas remain unserved. The Commission solicits input from all interested parties in the concurrently adopted FNPRM as to whether there are other changes they could make to our high-cost program, working within the defined budget, that would create additional incentives to deploy broadband for companies in areas where end user revenues alone are insufficient to make a business case to deploy broadband.
154. In our predictive judgment, the mechanisms that the Commission adopts today to keep disbursements within the previously adopted budget will provide rate-of-return carriers with support that is sufficient to meet the Commission's universal service goals. If any carrier believes that the support it receives is insufficient, it may seek a waiver of our rules. As the Commission noted in the
155. Finally, the Commission notes that the promotion of universal service remains a federal-state partnership. The Commission expects and encourage states to maintain their own universal service funds, or to establish them if they have not done so. The expansion of the existing ICLS mechanism to support broadband-only loops and the voluntary path to model-based support should not be viewed as eliminating the role of the states in advancing universal service; far from it. The deployment and maintenance of a modern voice and broadband-capable network in rural and high-cost areas across this nation is a massive undertaking, and the continued efforts of the states to help advance that objective is necessary to advance our shared goals.
156. It is our desire to implement these revisions to our rules as soon as possible. The Commission recognizes, however, that implementing some of these changes will require new or revised information collections requiring approval from the Office of Management and Budget pursuant to the Paperwork Reduction Act. Further, some of the changes the Commission adopts must be coordinated with the Commission's existing cost accounting and tariffing rules. Given the administrative requirements the Commission has noted, it does not anticipate that full implementation of the new Connect America Fund Broadband Loop Support and related changes will occur prior to October 1, 2016. The Commission delegates authority to the Bureau to take all necessary administrative steps to implement the reforms adopted in this Order.
157.
158.
159. In the following subsections, the Commission addresses cost allocation and tariff-related issues raised by adoption of the new CAF-ACAM and CAF-BLS mechanisms discussed above. The implementation of those support programs and the cost allocation and pricing issues addressed below will be coordinated so that the appropriate cost allocation and tariff revisions will occur when the new mechanisms become effective.
160. Today, broadband-only loops are generally offered through interstate special access tariffs. The costs associated with those loops are allocated 100 percent to the interstate jurisdiction by the separations procedures in Part 36 and then to the special access category by subparts D and E of Part 69. Under this process, the interstate broadband-only loop costs are included in the special access revenue requirement upon which cost-based special access rates are determined. When the new high-cost support rules take effect, a carrier may receive support for a portion of its broadband-only loop costs. Unless an adjustment is made, a carrier could recover the costs associated with the broadband-only loop twice—once through the CAF-BLS mechanism and a second time through special access rates based on the existing special access revenue requirement.
161. To avoid this situation, the Commission amends Part 69 in two ways to implement the goal articulated in the
162. Second, the Commission revises part 69 of our rules to reallocate costs to avoid double recovery. These revisions require a carrier to move the costs of consumer broadband-only loops from the special access category to the new Consumer Broadband-Only Loop category. Today, the facilities associated with the common line and the consumer broadband loop run between the end-user premises and the central office, and are often the same technology or share some common transmission capacity. Thus, it is reasonable to conclude that the costs associated with these two types of lines are very similar. The interstate Common Line revenue requirement includes 25 percent of the total unseparated loop costs, while the consumer broadband-only loops will include 100 percent of the total unseparated loop costs. For purposes of deriving the amount of consumer broadband loop expenses to be removed from the Special Access category. This does not revise any rule associated with calculating the actual common line investment and expenses. It is solely for the purpose of establishing the amount of consumer broadband-only loop investment and expenses to remove from the special access category, carriers will calculate common line investment and expenses using an interstate allocation of 100, rather than 25. The common line expenses produced by this calculation will then be divided by the number of voice and voice/data lines in the study area to derive the interstate common line expenses per line. The interstate common line expenses per line will be multiplied by the number of consumer broadband-only loops to derive the consumer broadband-only loop expenses to be removed from the special access category. The Commission takes this approach because it includes the broadest definition of loop costs feasible based on our current cost accounting rules. These actions will segregate the broadband-only loop investment and expenses from other special access costs currently included in the special access category, and also preclude cross-subsidization. The Commission will oversee NECA's actions to ensure that these changes are implemented consistent with the Commission's intent.
163.
164. Currently, a rate-of-return carrier may offer broadband-only loops through its interstate special access tariff. The consumer broadband-only loop service is the telecommunications input to a wireline broadband Internet access service. When the revised rules adopted herein become effective, a rate-of-return carrier may tariff a consumer broadband-only loop charge for the consumer broadband-only loop service. Alternatively, a carrier may detariff such a charge. If the rate-of-return carrier chooses to detariff its wholesale consumer broadband-only loop offering, it no longer will be voluntarily offering the transmission as a service that is assessable for contributions purposes. As such, it would not have a contributions obligation for that service, similar to other carriers that previously chose not to offer a separate tariffed broadband transmission service. The carrier may not, however, tariff the charge to some customers, while detariffing it for others. Because that service is not rate regulated, no carrier should in any way represent or create the impression that the broadband-only loop charge is mandated by the Commission. This limitation is designed to preclude a carrier from using this flexibility to discriminate among customers taking broadband-only services.
165.
166.
167. The Commission does find, however, that rate-of-return carriers electing model-based support could benefit from continued participation in the NECA tariffs. The Commission accordingly decides to preserve the option for carriers to use NECA to tariff these charges. The charges shall be capped at current levels for existing charges, and at $42 for the consumer broadband-only loop charge. This approach allows the carriers electing model-based support to benefit from the administrative efficiencies associated with participating in the NECA tariff.
168.
169. A carrier may tariff different pricing models for the loop service, but it must select one model for a study area. A carrier in the NECA pool that elects to detariff its consumer broadband-only loop service must remove all of its Consumer Broadband-Only Loop category revenue requirement from the pooling process. It will retain the support that would have been applied to the Consumer Broadband-Only Loop category revenue requirement if it had not detariffed its consumer broadband-only loop rates, plus any revenue resulting from its detariffed rates.
170.
171. The first effect from providing support to consumer broadband-only loops is a likely migration of some end users from their current voice/broadband offerings to supported broadband-only lines due to increased affordability of these services. Although the Commission cannot predict the extent of this migration, such changes will reduce the number of ARC-eligible lines under the current rules and thus the amount of Eligible Recovery that the carrier can recover via ARC charges. As explained above, recovery from CAF-ICC will be provided to the extent carriers Eligible Recovery exceeds their permitted ARCs. Thus, under the existing recovery rules, a migration of end users to consumer broadband-only loop service would upset the careful balancing of burdens as between end-user ARC charges and universal service support,
172. The second effect that will occur from the adoption of support for consumer broadband-only loops is that, as voice/broadband lines are lost, a carrier's switched access revenue will go down. Absent Commission action, the recovery mechanism would produce a higher Eligible Recovery for the carrier and a higher CAF-ICC amount. Nevertheless, the likelihood exists that some of the facilities used to support the lost switched access services will be reused to provide a portion of the broadband-only service. This is especially true with respect to transport and circuit equipment, although it could include other facilities as well. Thus, in some cases, the carrier would be receiving some special access revenue recovering the costs of facilities formerly used to provide switched access services. Such circumstances would result in double recovery under the rules adopted in the
173. In light of our experience in implementing our high-cost reporting requirements to date and our desire to respond to the recommendation of the Government Accountability Office to improve the accountability and transparency of high-cost funding, the Commission now makes several changes to our reporting rules. In this section, the Commission streamlines and revises rate-of-return ETCs' annual reporting requirements to better align those
174.
175. Specifically, similar to the current requirements for price cap ETCs, the Commission adopts a rule requiring all rate-of-return ETCs, starting in 2017, and on a recurring basis thereafter, to submit to USAC the geocoded locations to which they have newly deployed broadband. These data will provide an objective metric showing the extent to which rate-of-return ETCs are using funds to advance as well as preserve universal service in rural areas, demonstrating the extent to which they are upgrading existing networks to connect rural consumers to broadband. USTelecom, NTCA, WTA and ITTA propose that rate-of-return carriers submit the number of locations that are newly served in the prior year, with both USTelecom and ITTA explicitly proposing that ETCs electing CAF-ACAM support submit geocodes for such locations. Rate-of-return ETCs will also be required to report the number of locations at the minimum speeds required by our rules. The location and speed data will be used to determine compliance with the associated deployment obligations the Commission adopts today. The geocoded location information should reflect those locations that are broadband-enabled where the company is prepared to offer service meeting the Commission's minimum requirements for high-cost recipients subject to broadband public interest obligations, within ten business days.
176. The Commission expects ETCs to report the information on a rolling basis. A best practice would be to submit the information no later than 30 days after service is initially offered to locations in satisfaction of their deployment obligations, to avoid any potential issues with submitting large amounts of information at year end. The Commission concludes that the submission of information in near real-time as construction is completed will be beneficial to all carriers and particularly useful to smaller carriers. For instance, ETC technicians will be able to upload the location information as part of the routine process of updating its customer service availability database upon completion of construction or in conjunction with initiation of marketing efforts for the newly available service, instead of having to record the location and transferring all of that information to an annual report six to 18 months later. It should also minimize the strain on USAC's information technology systems to avoid a massive amount of bulk uploads centered on a single, annual deadline. The Commission notes that the amount of information to be uploaded at the end of the calendar year is likely to relatively low, as December is not construction season in many locales. While rate-of-return ETCs will have until March 1 to file their location data for the prior calendar year, reporting on a rolling basis before then will allow filers to receive real-time validation from USAC's system prior to the deadline and thereby provide the opportunity to timely correct any errors or avoid delays due to system overload.
177. The Commission finds that the benefits in collecting this location-specific broadband deployment information outweigh any potential burdens from reporting this data, particularly because rate-of-return ETCs already collect location information for other purposes. Rate-of-return carriers presumably maintain records of addresses that are newly enabled with service, so that they can begin to market such service to those customers. Moreover, rate-of-return carriers already are required under our existing rules to maintain records for assets placed in service indicating the description, location, date of placement, and the essential details of construction. Thus, both for marketing and regulatory purposes, rate-of-return carriers already are tracking where they extend fiber and install other facilities, and should be able to determine through commonly accepted engineering standards which locations should be able to receive service at specified speeds. The Commission directs the Bureau to work with USAC to develop a means of accepting alternative information in those instances where a postal code or other standardized means of geocoding is not readily available. Furthermore, the Commission delegates authority to the Bureau to act on individual requests for waiver of this requirement in those cases where the parties can demonstrate other unique circumstances that make compliance with the geocoding requirement for a subset of locations impracticable.
178. Similar to the regime adopted for the price cap carriers that elected Phase II model-based support, companies that elect model-based support will include in their total location count any locations that already have broadband meeting the Commission's minimum standards. While the Commission encourages carriers to submit geocoded location information for their existing broadband locations no later than the deadline for the 2017 reporting, they recognize the possibility that some smaller companies may not already
179. The Commission concludes that it is necessary to establish a standardized and automated system to collect the volume of location level data on carrier progress in meeting deployment obligations. Below, the Commission directs the Bureau to work with USAC to develop an online portal that will be available for rate-of-return carriers to submit location information on a rolling basis throughout the year. The Commission directs USAC, working with the Bureau, to prepare a plan for the efficient collection, analysis and access to this location data. The plan should be provided to the Bureau within two months of release of this Order and address the use of automated reminders for year-end submission due dates, standardized data elements to the extent possible, and the time frame necessary to implement an online portal.
180. The Commission also establishes certifications to be filed with ETCs' location submission, to ensure ETCs' compliance with their public interest obligations. Each rate-of-return ETC electing CAF-ACAM support must certify that it met its 40 percent interim deployment obligation at the time it files its final location report for 2020, due no later than March 1, 2021, and file similar certifications annually thereafter. Rate-of-return ETCs remaining on embedded cost mechanisms must file a similar certification within 60 days of the deadline for meeting their defined deployment obligations,
181. In conjunction with adopting the location reporting requirements above to track rate-of-return ETCs' build-out progress, the Commission now eliminates the requirement for rate-of-return ETCs to file a service quality improvement plan. The purpose of the five-year plan and annual updates was to ensure that “ETCs [ ] use their support in a manner consistent with achieving the universal availability of voice and broadband.” With the reforms adopted in this order, rate-of-return ETCs are now subject to detailed broadband buildout obligations, which provide a more defined yardstick by which to measure their progress towards the universal availability of voice and broadband service in their areas. The Commission therefore finds that it is unnecessary for rate-of-return ETCs to file a five-year service quality improvement plan. Moreover, the Commission concludes that because there is no longer a requirement to file a service quality improvement plan, they also should eliminate the obligation in our rules for rate of return ETCs to file updates on that plan under our authority to eliminate rules that are no longer applicable. The Commission also modifies, on the same basis, other rules to remove references to the service quality improvement plan.
182. Once the Commission receives Paperwork Reduction Act approval for the revised requirement to report geocoded locations and the elimination of our progress reporting requirement, rate-of-return ETCs will no longer be required to file a progress report containing maps and a narrative explanation of “how much universal service support was received, and how it was used to improve service quality, coverage or capacity and an explanation regarding any network improvement targets that have not been met . . . at the wire center level or census block as appropriate.” The Commission concludes that the geocoded location lists that each recipient will be required to submit on an annual basis will provide the Commission with more precisely targeted information to monitor the recipients' progress towards meeting their public interest obligations, and at that point there will no longer be a need for recipients to file annual progress reports.
183.
184. Specifically, upon the relevant Paperwork Reduction Act approvals, price cap ETCs will be required to submit the requisite information to USAC no later than March 1 of each year, for locations newly enabled in the prior year. Because these changes will not go into effect by the time the 2015 Form 481 is due on July 1, 2016, the form and content of that filing will remain unaffected. They will be free—and indeed, encouraged—to submit information on a rolling basis throughout the year, as soon as service is offered, so as to avoid filing all of their locations at the deadline. By filing locations in batches as construction is completed and service is offered, they will avoid any last minute problems with submitting large quantities of information and be able to receive confirmation prior to the deadline that information was received by USAC. As they do now, price cap carriers will continue to make annual certifications that they are meeting their public interest obligations, but will do so when submitting the information to USAC by this deadline, rather than in their annual reports. The Commission makes conforming edits to our rules by moving the certifications in section 54.313(e)(3)-(e)(6) to new section 54.316. In light of our unification of reporting obligations, the Commission deletes the section of our rules regarding price cap ETCs' deployment obligations
185. Finally, for the reasons explained above for rate-of-return ETCs, the Commission eliminates the requirement for price cap ETCs to file a service quality improvement plan and to file annual updates, as well as make conforming changes to our rules.
186.
187. The Commission directs the Bureau to work with USAC to put appropriate protections in place for ETCs to seek confidential treatment of limited subset of the information. Entities, such as states and Tribal governments, which already have access to confidentially filed information for ETCs' within their jurisdiction, will continue to have access to such information through the online database. The Commission finds that making such data publicly available will increase transparency and enable ETCs, the Commission and other stakeholders to assess ETCs' progress in deploying broadband throughout their networks as well as compliance with our rules. Once these updated systems are operational, the Commission anticipates that it would no longer require ETCs to submit duplicative information with the Commission through ECFS and with state commissions. Rather, all such information will be submitted to the Administrator, with federal and state regulators, and Tribal governments where applicable, having full access to such information. The Commission seeks comment on this proposal in the concurrently adopted FNPRM.
188. As ETCs comply with the new public interest and reporting requirements and broadband public interest obligations in this Order, the Commission will continue to monitor their behavior and performance. Based on that experience, the Commission may make additional modifications as necessary to our reporting requirements.
189. The Commission takes this opportunity to make several non-substantive rule amendments. The Commission finds that notice and comment is unnecessary for rule changes that reflect prior Commission decisions to eliminate several support mechanisms that inadvertently were not reflected in the Code of Federal Regulations (CFR). Similarly, the Commission finds notice and comment is not necessary for rule amendments to ensure consistency in terminology and cross references across various rules, to correct inadvertent failures to make conforming changes when prior rule amendments occurred, and to delete references to rules governing past time periods that no longer are applicable.
190. First, the Commission removes section 54.301, Local switching support, from the CFR. The Commission eliminated local switching support (LSS) as a support mechanism in the
191. As part of our modernization of the framework for rate-of-return support, the Commission also
192. It is important that the Commission takes such comprehensive action to ensure the prescribed rate of return is commensurate with the investment risks incumbent LECs are undertaking today, such as broadband network investments, and at the same time reflects current market conditions. Our adoption today of self-effectuating measures to ensure that high-cost support remains within the budget established by the Commission in no way lessens the rationale for represcribing the authorized rate of return. Our adopted rate of return will provide rate-of-return carriers with economically efficient incentives to deploy broadband to meet the needs of their customers. An unnecessarily high rate of return inefficiently allocates funds away from carriers with relatively low capital to other expense ratios toward those with higher ratios. Moreover, an excessive rate of return inefficiently distorts individual rate-of-return carriers' investment and other decisions, reducing what can be achieved with available universal service resources. While an excessive rate of return might provide a minimally stronger incentive for rate-of-return carriers to extend broadband network deployment, this would only be so for marginal projects, which would likely be a minority of all potential projects. As a general matter, deployment decisions are not sensitive to small changes in profitability. In any case, the Commission concludes that it is preferable to achieve our deployment objectives directly and transparently through the adoption of defined mandates and appropriate targeting of subsidies, rather than in a concealed manner by maintaining an inefficiently high rate of return, which creates distortions and also creates other unintended and difficult to predict consequences. In addition to ensuring responsible stewardship of finite universal service funds, our action here will also reduce certain rates for customers in rural areas.
193. As described in detail below, the represcribed rate of return will apply in all situations where a Commission-prescribed rate of return is used. The rate of return is used to calculate interstate common line rates, consumer broadband-only loop rates, as discussed elsewhere in this Order, and business data service (
194. Section 205(a) of the Communications Act requires the Commission to give “full opportunity for hearing” before prescribing a rate including the authorized rate of return for rate-of-return carriers. However, as the Commission explained in the
195. On December 29, 2011, NECA, the Organization for the Promotion and Advancement of Small Telecommunications Companies, and the Western Telecommunications Alliance (collectively, Petitioners) filed a joint petition for reconsideration of the
196. Petitioners argue that, prior to represcribing, the Commission must first adopt revised rules addressing alleged “flaws” in the prescription rules. According to Petitioners, the Commission “admitted its methodology for determining `comparable firms' was deficient” in that it did not know how to account for the fact that many rate-of-return incumbent LECs are locally owned and not publicly traded. Petitioners argue that the Commission should correct these alleged “flaws” in the rules before represcribing the rate of return. Similarly, the Rural Associations and GVNW argue that having waived Part 65 procedural rules governing prescription, the Commission must establish clear replacement rules to govern the process under section 205. The Rural Associations note that in the
197. The Commission disagrees with Petitioners and hereby deny their Petition with respect to these claims. Petitioners mischaracterize the Commission's prescription process as rigid adherence to set methodologies. The rules provide a framework, but leave the Commission discretion to qualitatively and quantitatively estimate a rate of return. The Commission's prescription rules specify the calculations for computing the rate of return,
198. The Commission rejects Petitioners' claims that our “methodology for determining `comparable firms' was deficient,” and that they do not know how to account for the fact that many rate-of-return incumbent LECs are “locally owned and not publicly traded.” As discussed in further detail below, the most widely used methods of calculating the cost of equity, a key component in calculating the rate of return, call for data from publicly traded firms, yet the vast majority of rate-of-return carriers are not publicly traded. To address this concern, the Commission selects below an appropriate set of publicly-traded surrogate or proxy firms, for which financial data is available publicly to infer the cost of equity for these carriers. Any deficiencies in the methodology used to calculate the rate of return and use of a proxy group can be and have been addressed in the
199. Petitioners also argue that the notice and comment procedures the Commission adopted in the
200. The Commission rejects these assertions because, consistent with
201. Moreover, interested parties have had no less than three different opportunities to participate in the represcription process. In response to the
202. In the
203. Although the Commission waived the section 65.101 requirement that the Commission publish notice of the cost of debt, cost of preferred stock, and capital structure computed in the section 65.101(a) notice initiating prescription, they find that all interested parties had adequate notice of these calculations in the
204. The first step in the process to represcribe the rate of return is to identify the appropriate data and methodologies to use in calculating the WACC. To calculate the WACC for a company or group of companies, Commission rules require the determination of: (1) The company's capital structure,
205. The rules specify that the WACC be calculated using Regional Bell Holding Companies (RHCs) data reported to the Commission through Automated Reporting Management Information System (ARMIS) reports. When the Commission last represcribed in 1990, it could rely on ARMIS reports to estimate the cost of debt and capital structure, which came from incumbent LECs with investment-grade bond ratings—companies engaged in substantially the same wireline operations as the small incumbent LECs also subject to rate-of-return regulation. The Commission, however, has forborne from collecting ARMIS reports from the RHCs so this data is no longer readily available. In the
206. The Commission's rate of return prescription rules envision calculating the WACC based on data from a proxy group of telephone companies that are intended to represent the universe of rate-of-return carriers. In the past, the Commission used the RHCs as proxy firms to determine capital structure and the costs of debt, equity, and preferred stock for all incumbent LECs. Today, with ARMIS reports a thing of the past, and with the largest RHCs increasingly dissimilar from the smaller rate-of-return incumbent LECs, the Commission must expand its analysis beyond the RHCs to ensure that its analysis reasonably reflects the nature of today's rate-of-return incumbent LECs. The Commission finds that it is no longer reasonable to rely exclusively on RHC data based on reports no longer collected as specified in our rules. Accordingly, the Commission finds that they must identify a comparable proxy group representing the universe of rate-of-return carriers from which to draw data to calculate the WACC.
207. The reliability of our WACC calculation depends on the representativeness of the proxy group the Commission selects. The Commission sought comment in the
208. Commenters criticize staff's methodology for selecting its proposed
209. As an initial matter, there is scant reliable publicly available data for estimating the cost of capital specific to rate-of-return incumbent LECs. The most widely used methods of estimating the cost of equity in particular call for data only available from publicly-traded firms, yet the vast majority of rate-of-return carriers are not publicly traded. A publicly-traded company's stock price and dividend payments are observable, while those of a privately held firm, including the overwhelming majority of rate-of-return incumbent LECs, are not. Therefore, using the models used most often to estimate the cost of equity, the cost of equity for firms that are not publicly traded is inferred based on data from firms that are publicly traded. Because the vast majority of rate-of-return carriers are not publicly traded, the Commission must select an appropriate proxy group of incumbent LECs, for which financial data is publicly available and which face similar risks as rate-of-return carriers to calculate the cost of capital.
210. Furthermore, staff selected the proxy group based in part on the reliability of financial data such as the frequency equity is traded and overall financial health. These factors were not, however, the only factors. Staff also relied on publicly-available data and observable stock prices for a proxy group of publicly-traded telecommunications companies that would enable the development of estimates that as closely as possible reflect the risk of the market for regulated interstate telecommunications services. To select this proxy group, staff applied a qualitative analysis that included a number of different factors, including the extent to which a company's operations could be classified as price-regulated interstate telecommunications services and similarity to rate-of-return operations. The Commission finds that staff's qualitative approach was reasonable, not simply relying on available data, but data that was both reliable and relevant to the analysis.
211. As one key criterion for selection, staff required that a proxy firm derive 10 percent or more of its revenues from price-regulated interstate telecommunications services as an incumbent LEC. The Rural Associations characterize this selection criteria as “arbitrary” and without justification, which it claims is lower than the rate-of-return incumbent LECs as a group. While the Commission agrees with the Rural Associations that 10 percent is a relatively low number, they find the proxy group of firms selected after applying the 10 percent threshold (along with the other criteria used in the
212. The WACC estimates the cost of capital for price-regulated interstate special access and common line services which are facilities-based wireline telecommunications services. The proposed proxy group consisted of firms where, in addition to their price-regulated business operations, a substantial portion of their business operations that are not price-regulated provide facilities-based wireline telecommunications services. Thus, an overall WACC estimate for the firm as a whole should be a reasonable approximation of the WACC for the price-regulated interstate access service. In fact, many of the wireline network assets,
213. The Rural Associations criticize staff's proxy group for including RHCs Proxies, Mid-Size Proxies and Publicly-Traded RLEC Proxies as unrepresentative of the market risks that rate-of-return incumbent LECs face affecting their ability to attract capital. For example, the Rural Associations proposed estimating the cost of capital using rate-of-return incumbent LEC-specific data rather than data assembled from staff's proxy companies. ICORE asserts that the RHC Proxies and Mid-Size Proxies have more diverse offerings than rate-of-return incumbent LECs which therefore face higher costs of capital. Ad Hoc rebuts that argument, noting that it does not necessarily follow that less diverse operations means higher cost of capital and criticizes such arguments as “pure speculation” lacking any evidentiary basis. AT&T notes that critics of staff's proxy group did not submit data into the record to negate the need for proxies or proxies more representative of rate-of-return incumbent LECs than staff's proposed proxy. The Commission finds the staff's selection of the proxy group reasonable for the reasons given above and reject the Rural Associations' proposed proxy group for the reasons below.
214. In addition, the Rural Associations, the Alaska Rural Coalition and peer reviewer Professor Bowman question the inclusion in the proxy group of firms that had recently emerged from bankruptcy proceedings, including FairPoint Communications, Inc. (FairPoint), Hawaiian Telecom, as well as certain “financially unhealthy” Mid-Size Proxies. Professor Bowman argues in general that rate-of-return regulation is appropriate for companies that are financially healthy, and that an operation that is subject to rate-of-return regulation would not be expected to go bankrupt. Staff acknowledged in the
215. FairPoint entered bankruptcy in October 2009 and exited in January 2011, while Hawaiian Telecom entered bankruptcy in December 2008 and exited in October 2010. In the
216. The Rural Associations also criticize the financial health of the Mid-Size Proxies included in staff's proxy group. Staff acknowledged in the
217. The Commission agrees with the staff recommendation in the
218. In sum, the Commission finds that staff's approach to identifying a representative proxy group to be reasonable, including its decision to include RHC Proxies, Mid-Size Proxies, and Publicly-Traded RLECs Proxies in the proxy group. Notably, joint peer reviewers Albon and Gibbard found that the selections made appropriately balanced the trade-offs of a proxy group that is too small, which results in measurement errors, and a proxy group that is too large, which is unrepresentative. The Commission reiterates and agrees with staff's position that, collectively, the three groups represent a wide spectrum of incumbent LEC operations, include both price cap and rate-of-return regulated operations, and include those incumbent LECs with the most widely traded equity, allowing greater confidence in the calculations that rely on the public trading of stock, especially given that it is highly uncertain where within that spectrum non-publicly-traded rate-of-return incumbent LECs lie.
219. The allowable rate of return should reflect a reasonable estimate of the current cost of capital. The Bureau released the
220. Section 65.101(a) of our rules specifies that the Commission should initiate the rate of return prescription process when they determine that the monthly average yields on 10-year Treasury securities remain, for a consecutive six month period, at least 150 basis points above or below the average of the monthly average yields in effect for the consecutive six month period immediately prior to the effective date of the current prescription. As the cost of capital is constantly changing as a result of the interactions in the financial markets between buyers and sellers of debt and equities, our rule recognizes that the existing rate of return is based on financial data that is a snapshot in time and as such might not reflect the prevailing cost of capital. Likewise, the data reflected in the
221. The Commission therefore analyzes interest rates, similar to the analysis contemplated under section 65.101(a), to determine whether the data relied in the
222. The Commission compares the most recent monthly yields on the various Treasury and corporate securities to these two benchmarks. With respect to the October 2012-March 2013 benchmark, the monthly average yield on 10-year Treasury securities, the key benchmark in rule 65.101(a), in September 2015, the most recent month for which yield data are published by the Federal Reserve, is 2.17 percent, as compared to the six-month average of the average monthly yields, 1.83 percent. This difference is only 34 basis points, a spread significantly less than 150 basis points, the standard reflected in rule 65.101(a). The differences between the September 2015 average yields on the 5-, 7-, 20-, and 30-year Treasury securities and on Aaa and Baa corporate bonds, as compared to the six-month average of the monthly average for each security, respectively, are as follows: 73, 66, 34, 2, −5, 36, and 65 basis points. The greatest difference between the six-month average and any monthly average for any of these securities is the 107 basis point difference that existed in December 2013 and January 2014 for 7-year Treasury securities and December 2013 for 10-year Treasury securities, but the average of these differences for these securities were only 76 and 57 basis points, respectively, over the entire period. The fact that greatest difference between the six-month average and any monthly average for any of these securities is only 107 basis points demonstrates that the difference was never as large as 150 basis points relative to a single month, let alone for six consecutive months, the standard under the Commission's rule. The average of the differences between the six-month average and monthly averages throughout the period for the 5-, 20- and 30-year Treasury securities and Aaa and Baa corporate bonds were only 74, 36, 24, 42, and 27 basis points, respectively.
223. With respect to the July 2012-December 2012 benchmark, the monthly average yields on 5-, 7-, 10-, 20-, and 30-year Treasury securities and Aaa and Baa corporate bonds in September 2015 as compared to the six-month average of the average monthly yields for each security, respectively, are as follows: 81, 78, 50, 21, 15, 57, and 62 basis points. The greatest difference between the six-month average and any monthly average for any of these securities is the 123 basis point difference that existed in December 2013 for 10-year Treasury securities, but the average of these differences for this security was only 68 basis points over the entire period. The average of the differences between the six-month average and monthly averages throughout the period for the 5-, 7-, 20- and 30-year Treasury securities and Aaa and Baa corporate securities were only 75, 82, 53, 43, 61, and 22 basis points, respectively.
224. Based on these findings, the Commission concludes that interest rate changes have not been sufficiently large between release of the
225. As discussed above, the WACC estimates the rate of return that the incumbent LECs must earn on their investment in facilities used to provide regulated interstate services in order to attract sufficient capital investment. The Commission's rules specify that the composite WACC is the sum of the cost of debt, the cost of preferred stock, and the cost of equity, each weighted by its proportion in the capital structure of the telephone companies:
226. The Commission's rules currently require that the capital structure be calculated using the observed book values of debt, preferred stock, and equity. Under the Commission's rules, capital structure is calculated as follows:
227. In the
228. The embedded cost of debt is the cost of debt (expressed as a rate of interest) issued by the firm in the past and on which it paid interest over an historical accounting period (
229. The Commission's rules provide that the cost of debt is calculated as follows:
230. As noted in the
231. While the
232. USTelecom proposes an alternative approach that eliminates this error and that purports to capture a more forward-looking cost of debt. In particular, USTelecom proposes that company financial reports (
233. In addition, USTelecom's proposed approach uses data from a section of the SEC Form 10-K reports that at least for some carriers does not account for the fact that bonds often are sold at a discount below or a premium above the face value of the bond. Thus, the numerator in USTelecom's debt calculation is based on interest “payments,” which does not account for discounts and premiums, rather than based on interest expense, which does account for discounts and premiums, under generally accepted accounting principles (GAAP). Meanwhile, the debt in the denominator is the principal or payoff amount of the debt, which does not account for discounts and premiums, rather than the amount of debt outstanding, net of discounts and premiums, as recorded on the balance sheet. As a result, the cost of debt under this approach would understate the effective rate of interest for a bond sold at a discount or overstate this rate for a bond sold at a premium. The Commission therefore declines to adopt USTelecom's proposed approach.
234. The Commission's rules further specify that total interest expense be used in the numerator of the embedded
235. The Commission includes as part of total debt in the denominator of the embedded cost of debt calculation, obligations under capital leases, including the current portion of capital leases. It is not entirely clear whether the Commission included capital leases in its debt calculation in the
236. Professor Bowman states that the
237. In the
238. The Commission's rules do not specify how the cost of equity is to be calculated, and there are several methods that might be used to estimate the cost of equity. The Capital Asset Pricing Model (CAPM) is the most widely used method in commerce, while the Commission relied on the Discounted Cash Flow Model (DCF) to calculate the cost of capital in the
239. CAPM is widely used by financial practitioners to calculate the cost of equity of publicly traded firms. The required rate of return in CAPM is the sum of the risk free interest rate and an asset beta times a market premium. The required rate of return in CAPM is:
240.
241. Staff used as the expected risk-free rate the then-current rate of interest at the market's close on March 26, 2013, rather than an historical average of past interest rates calculated over a period of time, a forecast, or a rate based on some other methodology. Staff reasoned that the current interest rate as of a single day was the best predictor of the future interest rate on government securities incorporating investors' current expectations about the future rate. Staff noted that the current interest rate frequently is a better predictor of future interest rates than professional forecasts. Staff relied on an efficient market theory, taking as an assumption that bond markets are efficient, meaning that interest rates factor in all publicly-available information, and that current interest rates adjust quickly to reflect new public information as it becomes available. Staff noted criticisms of the efficient market theory in the
242. Accordingly, instead of relying solely on efficient market theory and use of the then-current, March 26, 2013 rate of interest on the 10-year Treasury note as the expected risk-free rate, the Commission concludes that a blended approach taking all these factors into account would be preferable. The Commission therefore derives the risk-free rate of return interest rate by weighting equally: (1) The March 2013 average 10-year rate, thus recognizing in part the tenets of efficient market theory; and (2) the 3.70 percent 10-year forecast for the 10-year Treasury rate by produced by the Survey of Professional Forecasters for the first quarter of 2013 published by the Research Department of the Federal Reserve Bank of Philadelphia, and referenced by the Rural Associations in their comments, thus also recognizing the value of professional forecasts. The Commission believes that this blended approach reasonably reflects the acknowledged, albeit imperfect, predictive value of current interest rates, and the value of the informed, though imprecise, judgement of professional forecasters.
243. Use of the March 2013 average 10-year Treasury rate as part of this revised approach is consistent with AT&T's and Professor Bowman's suggestions that an average interest rate be used rather than the rate on a single day. The Commission disagrees, however, with their suggestions that this average should be calculated looking back over a period as long as three or six months. The Commission believes that capital markets are reasonably efficient. The primary reason for using a historical average, in our view, is to ensure that any temporary aberration in the interest rate on any given day not be erroneously reflected in the estimate. In other words, the purpose is to smooth out any large, though random, variation that might be in the interest rate on any given day, especially during a period in which markets might be particularly volatile. The Commission believes that a one-month average is long enough to ensure that the estimate does not reflect any such aberration. At the same time, a one month average is short enough that it is reasonably consistent with the notion that bond markets are efficient, so that it reflects reasonably fresh, publicly-available information.
244. The March 2013 average 10-year rate is 1.96 percent, slightly higher than the March 26, 2013 interest rate of 1.92 percent used in the
245.
246.
247.
248. Several commenters argue in favor of an additional market risk premium based on the size of the firm because they claim small firms face higher risks and illiquidity effects due to not being publicly traded, among other reasons. Ad Hoc notes, however, that critics of the
249. AT&T offers a number of reasons why a size premium should not be considered in the CAPM WACC calculation. AT&T argues that the majority of rate-of-return incumbent LECs are members of the NECA pools and these pools allow its members not only to pool their costs and revenues, but also effectively pool their risks. AT&T further argues that any risks that the smaller rate-of-return incumbent LECs might face are further reduced by rate-of-return regulation that protects them against under-earning, and the Federal Universal Service Fund and its true-up mechanisms. AT&T adds that some rate-of-return incumbent LECs have established holding company structures and resemble larger firms in terms of market and product diversification. Finally, AT&T argues that many of these rate-of-return LECs may be subject to lesser market risks, since they tend to serve more rural and less densely populated areas where competition has been slower to develop or has yet to develop. Professor Bowman favors making an adjustment when appropriate, but notes that it is not clear that firms subject to the cost of equity resulting from represcription are as small as firms that have been shown to manifest the small firm effect, and therefore staff's analysis may not warrant an adjustment.
250. As staff noted in the
251. Staff estimated the cost of equity using the CAPM with adjusted betas that were calculated using weekly data, along with its estimates for the risk-free rate and market premium, the latter based on the average historical market premium above the 10-year risk free rate for the period 1928-2012 developed by Professor Aswath Damodaran. Staff's calculation of the average of the CAPM cost of equity estimates for the 16 proxy companies is 7.18 percent, which staff determined was low compared to the cost of debt estimates, including estimates for six firms that are below the cost of debt estimates. Estimates of the cost of equity should be significantly higher than the cost of debt because equity is more risky than debt as debtholders are paid before equity holders in the event of financial difficultly, bankruptcy or liquidation. Staff noted that the difference between the arithmetic averages of large company stock returns and the long-term bond returns was 5.7 percentage points (570 basis points) over the period 1926 to 2010, while the difference between the average cost of debt estimate for the 16 proxy companies of 6.19 percent, as compared to the 7.18 percent cost of equity estimate, is only 0.99 percentage points (99 basis points). This suggests staff's cost of debt estimate is too high, or staff's cost of equity estimate is too low, or both—an issue the Commission addresses below.
252. The Commission now estimates the CAPM cost of equity using our revised estimate for the risk-free interest rate, 2.83 percent, along with the adjusted betas and market premium used in the
253. The average of the revised CAPM cost of equity estimates for all 16 firms, including New Ulm, is 8.09 percent. Notably, the cost of equity estimate is less than the cost of equity estimate for just one of the 16 firms, Hawaiian Telecom (7.21 percent versus 7.45 percent). Meanwhile, the difference between the average cost of debt for the 16 proxy companies, 5.87 percent, and this average cost of equity estimate is 2.22 percent (222 basis points), a difference that is still relatively low, but is more than double and is more reasonably in line with expectations of the relationship between debt and equity costs found in the
254. The Commission also addresses the issue of relatively low CAPM cost of equity estimates in determining the reasonable CAPM WACC Range, as did staff in the
255. The Rural Associations argue that staff's truncation of the confidence interval renders staff's associated cost of capital recommendations unreliable. The Commission disagrees. First, the Commission views the range between 1.22-10.54 percent as an objective and
256. The Rural Associations observed and staff itself acknowledged that this adjustment to the 95 percent confidence interval is not precise. As staff noted, to the extent our estimates of the cost of debt are too high, this choice would bias upward our estimates of the return on equity. Because the cost of equity typically would materially exceed the cost of debt, however, assuming a cost of equity that equals the cost of debt tends to bias our estimates downwards. It is not clear which of these two offsetting biases is likely to be larger. In practice, this is not a significant concern because this adjustment affects only the lower bound, not the upper bound of the CAPM WACC range of reasonable estimates. As a long as the Commission does not select an estimate that is at or near the bottom of this range, that estimate and the resulting allowable rate of return should be reasonable. Moreover, the Commission also has the DCF WACC range of reasonable estimates on which to rely. The WACC and DCF have different strengths and weaknesses, and the Commission reduces the likelihood of error by developing WACC estimates using both models. As long as the Commission also selects an estimate that is consistent with the DCF WACC range, then that estimate should be a reasonable estimate.
257. The Commission now estimates new lower and upper bounds for the range of reasonable WACC CAPM using our revised estimate for the risk-free rate, 2.83 percent, along with the adjusted betas and the staff's approach for establishing a range for the market premium. The Commission develops different lower and upper bounds based on: (1) The proxy group, including New Ulm, (2) the proxy group, excluding New Ulm, and (3) the CAPM estimates for the 15 firms and setting the cost of equity for New Ulm equal to its cost of debt estimate plus the average of the differences between the cost of debt and equity estimates of the 15 firms. Taking this approach, the Commission now finds that the range of reasonable WACC CAPM estimates is 7.12-8.83 percent if the proxy group includes New Ulm; 7.24-9.01 percent if it excludes New Ulm; and 7.17-8.92 percent based on setting the cost of equity for New Ulm equal to its cost of debt estimate plus the average of the differences between the cost of debt and equity estimates of the 15 firms. The highest of upper bound values and the lowest of the lower bound values, provide an overall range of 7.12-9.01 percent.
258. Professor Bowman argues that the CAPM WACC range should be at least three percentage points (300 basis points), if not higher, given the uncertainty with which CAPM input values are estimated (our range is 1.89 percentage points or 189 basis points). However, the Commission finds our CAPM WACC range, 1.89 percentage points (189 basis points), is sufficiently large because that range reflects the lower and upper bounds of our market risk premium. The lower bound of the market premium is constrained by our estimates of the cost of debt, while the upper bound is at the top of the ranges used by most practitioners. Absent the lower bound constraint, the range would have been much larger reflecting greater uncertainty in the market premium estimate, but including that lower portion and allowing that uncertainty potentially to be reflected in the cost of equity estimates and thus the WACC estimates would be contrary to economic theory. Furthermore, the Commission has DCF WACC estimates on which to rely, in addition to WACC CAPM estimates, as mentioned above.
259. In addition to calculating the cost of equity using CAPM, in the
260. Staff estimated the cost of equity using the constant-growth DCF model for each of the 11 proxy firms that pay common stock dividends and had readily-available, long-run growth rate forecasts. To do this, staff identified the low and the high estimates among the estimates available from four different sources for each firm, determined the midpoint between these two estimates, and used this value as the growth rate in the DCF model for each firm. Based on this analysis, staff determined that the average cost of equity estimate for the 11 firms was 9.90 percent.
261. Staff found, however, that the DCF analysis did not appear to produce reliable estimates for Windstream and ACS. The published growth rates for these two firms were low, and use of these rates in most cases resulted in cost of equity estimates that were less than the cost of debt estimates. Staff reasoned that these results are questionable because equity is more risky than debt; no rational investor would ever purchase any firm's common stock if that firm's debt is expected to provide a higher rate of return. Staff noted that the Commission had applied a screen designed to remove from consideration those firms for which the cost of debt exceeded the cost of equity when developing estimates of the cost of equity in the
262. Staff therefore analyzed the sensitivity of the average of the cost of equity estimates to the estimates for Windstream and ACS. First, staff excluded Windstream and ACS from the sample, leading to an average cost of equity for the nine remaining firms of 11.25 percent, as compared to the average of 9.90 percent when these two firms were included. Second, staff set the cost of equity estimate equal to the cost of debt estimate for the two firms, leading to an average cost of equity estimate of 10.54 percent for the 11 firms. Third, staff calculated the average difference between the cost of equity estimates and the cost of debt estimates for the other nine firms, and added this increment to the cost of debt estimates for Windstream and ACS, to obtain equity estimates for these two firms, leading to an average cost of equity estimate of 11.58 percent for the 11 firms. The Commission agrees with staff's conclusion that where the use of these growth rates produces cost of equity estimates that have no economic meaning, such estimates should be omitted or, at the very least, the impact of including such questionable equity costs estimates on the overall estimate must be taken into account.
263. No party challenges staff's DCF methodology. The Commission therefore adopts the approach applied in the
264. Given the revisions the Commission makes above to the estimation of total debt outstanding and interest expense in the
265. Based on this DCF analysis, the Commission finds that the lower bound of a reasonable cost of equity estimate is 10.47 percent, while the upper bound is 11.54 percent. As a rough check on the reasonableness of these upper and lower bound cost of equity estimates, similar to the check in the
266. Based upon these slight modifications to DCF analysis presented in the
267. The Rural Associations estimate the WACC for a rate-of-return incumbent LEC by dividing an estimate of free cash flow (FCF) by an estimate of firm value, based on rate-of-return incumbent LEC data. GVNW and TCA supported the Rural Associations' FCF approach. While the Rural Associations' approach differs from the standard approach that the Commission uses here to estimate the WACC, and is not set out in our rules, they cannot say, based on the record that this is an unacceptable approach, at least in concept. The Commission is reluctant to dismiss too quickly any approach that could potentially aid the Commission now or in the future to produce better WACC estimates, especially given the difficulty to estimate the WACC for privately-held rate-of-return incumbent LECs. While the Commission does not find this approach to be unacceptable in concept, they do find flaws in the way that it is implemented by the Rural Associations. Thus, the Commission rejects the Rural Associations' estimates.
268. The Rural Associations base firm value, as reflected in the denominator of its WACC formula, on per connection sales prices for rate-of-return and price cap incumbent LEC exchanges for the period from 2008-2012. The Rural Associations develop a range of WACC estimates by varying its estimates of firm value. The Commission finds that this sample of prices is too small, and too many of its prices are for sales that occurred too long ago to provide a reliable basis for estimating firm value for a typical rate-of-return incumbent LEC. In particular, the sample included only one sale price for each year from 2010 to 2012. One observation per year, for the most recent three years, is far too few to obtain reliable firm valuations for these years, especially given the large variation in sale prices since 2008 ($1,053 to $3,205 per connection) and since 2003 ($1,013 to $8,000 per connection). As the perceived value of different exchanges varies significantly, as this price variation demonstrates, the value of the information reflected in one observation a year is of limited value for estimating the value of these firms today. Nor does one observation a year provide a strong basis for concluding that the level of these observed prices continues a trend from prior years, or that such a trend reliably could be used to estimate a firm's value today. While the sample included five sales prices for both 2008 and 2009, not only is this number of observations too small to estimate firm value with a high level of confidence, especially given the variation in prices, but these prices are too old to provide reliable estimates of firm value today.
269. The Rural Associations use the FCF WACC formula to develop a range of WACC estimates based on a sample of 633 rate-of-return incumbent LECs. Staff took issue with NECA et al.'s use of the median value of the WACC estimates for these rate-of-return incumbent LECs to establish a range for the WACC. In response, the Rural Associations, including NECA, recalculated its analysis using the average value weighted by access connections. This resulted in a large decrease in the range of WACC estimates (11.75 to 23.49 percent versus 8.69 percent to 17.39 percent).
270. Given that large decrease, the Commission now takes a closer look at the details of the Rural Associations' analysis. Based on our review, there is an enormous variance among the 633 rate-of-return incumbent LEC WACC estimates that the Rural Associations developed. There are many very high and very low WACC estimates. For example, focusing on the estimates based on the Rural Associations' midpoint valuation number, $1,800 per line, the values of the ten lowest estimates are: −271, −277, −305, −308, −320, −372, −429, −489, −631, and −862 percent. The values of the ten highest estimates, given this midpoint valuation, are: 121, 123, 124, 147, 155, 187, 201, 296, 393, and 838 percent. These high and low numbers, and there are more than just these 20, are implausibly high and low. The Commission is unaware of any wave of bankruptcies among the rate-of-return incumbent LECs, for as long as the Commission's allowable rate of return of 11.25 percent has been effect, and none of the commenters has suggested that the allowable rate of return for these carriers should be as high as the Rural Associations' estimates. Similarly, a negative expected rate of return,
271. Statistically speaking, and again focusing on the estimates based on the Rural Associations' midpoint valuation number, the median value WACC is 15.66 percent, the weighted average is 11.59 percent, the simple average is 8.64 percent, and the standard deviation relative to the simple average is 83.18 percent, a figure that is approximately 10 times greater than the simple average. Given this dispersion and the implausibly high and low WACC estimates, none of the typical measures of central tendency,
272. The Commission's rules specify that the WACC calculations incorporate the cost of preferred stock which is stock that entitles its holders to receive a share of corporate assets before common stockholders do, in the event of liquidation of the firm, and offers other benefits, such as priority when dividends are paid. Staff recommended in the
273. Appendices J & K to this Order shows the WACCs resulting from using both CAPM and DCF, together with the component values of each model and the estimates of the cost of debt and capital structure.
274. In determining the authorized rate of return, the Commission's starting point is to establish a zone of reasonable financial model-based estimates of the overall WACC. After identifying this WACC zone of reasonableness, the Commission may determine, based on policy considerations, where to prescribe the unitary rate of return. To determine a WACC zone of reasonableness, staff recommended comparing the range of WACCs produced when the cost of equity is determined using CAPM with varying market premiums, and the range produced when the cost of equity is determined using DCF.
275. The Commission finds above that a reasonable range for CAPM WACC estimates is 7.12 to 9.01 percent, while a reasonable range for DCF WACC estimates is 8.28 percent to 8.57 percent. Taken together, the overall range for reasonable WACC estimates is 7.12 to 9.01 percent, if there is no reason to believe that either model provides better estimates. The record is critical of the CAPM analysis in the
276. The reasonable range of WACC estimates discussed above are based on the cost of capital which serves as a useful and reliable starting point in rate of return represcription. The Commission, however, may consider other relevant factors as well. It is well established that rate of return prescription under the Act's “just and reasonable” standard requires a balancing of ratepayer and shareholder interests. A rate-of-return carrier must be allowed the opportunity to earn a return that is high enough to maintain the financial integrity of the company and to attract new capital. At the same time, to be reasonable, the rate of return must not produce excessive rates at the expense of the ratepayer. Courts have recognized that there is a zone of reasonableness within which reasonable rates may fall, and that the regulatory agencies are entitled to exercise judgment in selecting a rate of return within that zone. In general, the zone of reasonableness balances financial interests of the regulated company and relevant public interests. The Commission has substantial discretion when setting the authorized rate of return, and may consider a broad array of evidence and methodologies in prescribing the authorized rate of return. The Commission may also consider non-cost policy considerations in setting the rate of return.
277. The Commission is particularly mindful of the economic impact represcription will have on rate-of-return incumbent LECs. As Professor Bowman notes, companies subject to regulation face regulatory risk which increases the cost of capital. In this regard, the Commission agrees with Professor Bowman's argument that as a consequence of the asymmetry of social costs and benefits, and the uncertainties in the estimates of the true cost of capital, they should err on the high side when establishing the rate of return zone of reasonableness to minimize expected losses in social welfare through investment effects. Accordingly, expanding the zone of reasonableness above the top of the reasonable WACC estimates is supported in the record.
278. The Commission concludes that they should expand the upper end of the rate of return zone of reasonableness beyond the WACC estimates based on policy considerations and adopt the rate of return from the upper end of this zone. First, by expanding the zone of reasonableness, the Commission provides an additional cushion for rate-of-return incumbent LECs that may have a relatively high cost of capital compared to our proxies. There are hundreds of rate-of-return incumbent LECs. Some will have a relatively high and some a relatively low cost of capital. At the same time, the Commission adopts an authorized rate of return that applies to all of these carriers. To maximize the likelihood that the unitary rate of return is fully compensatory, even for firms with a relatively high cost of capital, the Commission expands the zone of reasonableness above the top of the range of WACC estimates developed above. Second, the Commission adds this cushion to the zone to account for regulatory lag—the time between recognition of the need for regulatory change in light of changing circumstances, in this case the need to prescribe a different rate of return, as capital markets change significantly, and regulatory action, in this case actually prescribing a new rate of return. The Commission therefore adds about three-quarters of a percentage point to the top of the WACC range developed above to account for these two factors, expanding the overall zone of reasonableness for the rate of return estimates to 7.12 to 9.75 percent.
279. The Commission notes that the WACC is supposed to compensate equity holders and debtholders who provide the funds used to finance the firm's assets. Given a rate of return set equal to 9.75 percent, an average capital structure based on our estimates of 54.34 percent debt, and a cost of debt based on our estimates of 5.87 percent, the implied cost of equity is 14.37 percent. The Commission finds that not only is the WACC of 9.75 percent high enough adequately to compensate the firm's debtholders, but the implied rate of return on equity also provides equity holders with the opportunity to earn a reasonable rate of return on their investment. As support for our finding that a 9.75 percent rate of return is reasonable, the Commission examines some benchmarks.
280. The difference between the implied cost of equity and the cost of debt estimate is 8.5 percentage points (850 basis points). By comparison, this 850 basis point difference exceeds the 439 basis point difference between the
281.
282. The Commission has authority under section 205 to prescribe a 9.75 percent unitary rate of return effective immediately. The Commission recognizes, however, that for almost 25 years rate-of-return carriers have made significant infrastructure investments on which they have had the opportunity to earn a rate of return of 11.25 percent until now, and that represcribing the rate of return will have a financial impact on these carriers. ICORE proposes that if the Commission lowers the rate of return, it should do so “in the most gradual and least disruptive manner possible.” The Moss Adams companies propose that “any changes that the FCC makes should be measured and spread over time.” USTelecom and NTCA recognize that rate represcription is “essential to a broadband reform effort” and suggest a multi-year transition to 9.75 percent. The Commission agrees. The Commission recognizes that rate-of-return incumbent LECs have been subject to significant regulatory changes in recent years, and that such changes are occurring at a time when these carriers are attempting to transition their networks and service offerings to a broadband world. At the same time, the Commission finds that they must represcribe the almost 25-year old rate of return to meet our statutory obligations. To minimize the immediate financial impacts that represcription may impose on carriers, the Commission adopts, for the first time, a transitional approach to represcription.
283. Under this transitional approach, as proposed by USTelecom and NTCA, the 11.25 percent rate of return will be reduced by 25 basis points per year until the Commission reach the represcribed 9.75 percent rate of return. For administrative simplicity, the Commission choose July 1, 2016 as the effective date for the initial transitional rate of return of 11.0 percent followed by subsequent annual 25 basis point reductions consistent with the table below until July 1, 2021 when the 9.75 percent rate of return the Commission represcribes today shall be effective.
284. This document contains new information collection requirements subject to the PRA. It will be submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the PRA. OMB, the general public, and other Federal agencies are invited to comment on the new information collection requirements contained in this proceeding. In addition, the Commission notes that pursuant to the Small Business Paperwork Relief Act of 2002, they previously sought specific comment on how the Commission might further reduce the information collection burden for small business concerns with fewer than 25 employees. The Commission describes impacts that might affect small businesses, which includes most businesses with fewer than 25 employees, in the Final Regulatory Flexibility Analysis (FRFA) in Appendix B,
285. As required by the Regulatory Flexibility Act of 1980 (RFA), as
286. In the Report and Order, the Commission establishes a new forward-looking, efficient mechanism for the distribution of support in rate-of-return areas. Specifically, the Commission adopts a voluntary path under which rate-of-return carriers may elect model-based support for a term of 10 years in exchange for meeting defined build-out obligations. The Commission emphasizes the voluntary nature of this mechanism; no carrier will be required to take model-based support, and the cost model has been adjusted in multiple ways over more than a year to take into account the circumstances of rate-of-return carriers. The Commission will make available up to an additional $150 million annually from existing high-cost reserves to facilitate this voluntary path to the model over the next decade.
287. The Commission also reforms the existing mechanisms for the distribution of support in rate-of-return areas for those carriers that do not elect to receive model-based support. The Commission makes technical corrections to modernize our existing interstate common line support (ICLS) rules to provide support in situations where the customer no longer subscribes to traditional regulated local exchange voice service,
288. One of the core principles of reform since 2011 has been to ensure that support is provided in the most efficient manner possible, recognizing that ultimately American consumers and businesses pay for the universal service fund (USF). The Commission continues to move forward with our efforts to ensure that companies do not receive more support than is necessary and that rate of return carriers have sufficient incentive to be prudent and efficient in their expenditures, and in particular operating expenses. Therefore, the Commission adopts a method to limit operating costs eligible for support under rate-of-return mechanisms, based on a proposal submitted by the carriers. The Commission also adopts measures that will limit the extent to which USF support is used to support capital investment by those rate-of-return carriers that are above the national average in broadband deployment in order to help target support to those areas with less broadband deployment. Lastly, to ensure disbursed high-cost support stays within the established budget for rate-of-return carriers, the Commission adopts a self-effectuating mechanism to control total support distributed pursuant to the HCLS and CAF-BLS mechanisms.
289. In 2011, the Commission also stressed the need to “require accountability from companies receiving support to ensure that public investments are used wisely to deliver intended results.” To this end, the Commission adopts deployment obligations that can be measured and monitored for all rate-of-return carriers, while tailoring those obligations to the unique circumstances of individual carriers. Those obligations will be individually sized for each carrier not electing model support, based on the extent to which it has already deployed broadband and its forecasted CAF BLS, taking into account the relative amount of depreciated plant and the density characteristics of individual carriers.
290. Another core tenet of reform adopted by the Commission in 2011, and unanimously reaffirmed in 2014, was to target support to areas that the market will not serve absent subsidy. To direct universal service support to those areas where it is most needed, the Commission adopts a rule prohibiting rate-of-return carriers from receiving CAF-BLS support in those census blocks that are served by a qualifying unsubsidized competitor. The Commission adopts a robust challenge process to determine which areas are in fact served by a qualifying unsubsidized competitor. Carriers may elect one of several options for disaggregating support for those areas found to be competitive. Any support reductions resulting from implementation of this rule will be more effectively targeted to support existing and new broadband infrastructure in areas lacking a competitor.
291. The Commission also addresses cost allocation and tariff-related issues raised by adoption of the reforms to high-cost support adopted in this Order for the provision of broadband-only loops. The Commission first creates a new service category known as the “Consumer Broadband-Only Loop” category, which will include the costs of the consumer broadband-only loop facilities that today are recovered through special access rates. Second, the Commission requires a carrier to move the costs of consumer broadband-only loops from the special access category to the new Consumer Broadband-Only Loop category. These actions will segregate the broadband-only loop investment and expenses from other special access costs currently included in the special access category and preclude double recovery of any costs assigned to the Consumer Broadband-Only Loop category.
292. The Commission will allow a rate-of-return carrier electing model-based support to assess a wholesale Consumer Broadband-Only Loop charge that does not exceed $42 per line per month. This rate cap allows a carrier the opportunity to recover its costs not covered by the model, while limiting the ability of a carrier to engage in a price squeeze against a non-affiliated ISP offering retail broadband service. The retail service provided to the end-user customer is not constrained by this limitation. Carriers electing model-based support that participate in the NECA common line tariff will be allowed to use the NECA tariff to offer their Consumer Broadband-Only Loop service to obtain the administrative benefits of a single tariff filing. They will not be eligible to participate in the NECA common line pooling mechanism, however, because the
293. A carrier that does not elect model-based support will have an interstate revenue requirement for its Consumer Broadband-Only Loop category. The projected Consumer Broadband-Only Loop revenue requirement will be reduced by the projected amount of CAF BLS attributed to that category in accordance with the procedures in Part 54. The remaining projected revenue requirement is the basis for developing the rates the carrier may assess, based on projected loops. Finally, providing support to consumer broadband-only loops likely will result in the migration of some end users from their current voice/broadband offerings thereby affecting the careful balancing of the recovery mechanism adopted in the
294. Finally, the Commission takes action to modify our existing reporting requirements in light of lessons learned from their implementation. The Commission revises eligible telecommunications carriers' (ETC) annual reporting requirements to align better those requirements with our statutory and regulatory objectives. The Commission concludes that the public interest will be served by eliminating the requirement to file a narrative update to the five-year plan. Instead, the Commission adopts narrowly-tailored reporting requirements regarding the location of new deployment offering service at various speeds, which will better enable the Commission to determine on an annual basis how high-cost support is being used to “improve broadband availability, service quality, and capacity at the smallest geographic area possible.”
295. In the Order and Order on Reconsideration, the Commission represcribes the currently authorized rate of return from 11.25 percent to 9.75. The Commission explains that a rate of return higher than necessary to attract capital to investment results in excessive profit for rate-of-return carriers and unreasonably high prices for consumers. It also inefficiently distorts carrier operations, resulting in waste in the sense that, but for these distortions, more services, including broadband services, would be provided at the same cost. Relying primarily on the methodology and data contained in a Commission staff report and public comments, the Commission identifies a more robust zone of reasonableness and adopt a new rate of return at the upper end of this range at 9.75 percent. As part of its estimation of the rate of return, the Commission revises its rule for calculating the cost of debt, an input in the cost of capital formula used to estimate the rate of return, to account for an overstatement of the interest expense contained in the rules. The new rate of return of 9.75 percent will be phased-in gradually over a six-year period.
296. There were no comments raised that specifically addressed the proposed rules and policies presented in the
297. Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel of the Small Business Administration (SBA), and to provide a detailed statement of any change made to the proposed rule(s) as a result of those comments.
298. The Chief Counsel did not file any comments in response to the proposed rule(s) in this proceeding.
299. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small-business concern” under the Small Business Act. A small-business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).
300. Our proposed action, if implemented, may, over time, affect small entities that are not easily categorized at present. The Commission therefore describes here, at the outset, three comprehensive, statutory small entity size standards. First, nationwide, there are a total of approximately 28.2 million small businesses, according to the SBA, which represents 99.7% of all businesses in the United States. In addition, a “small organization” is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” Nationwide, as of 2007, there were approximately 1,621,215 small organizations. Finally, the term “small governmental jurisdiction” is defined generally as “governments of cities, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” Census Bureau data for 2011 indicate that there were 90,056 local governmental jurisdictions in the United States. The Commission estimates that, of this total, as many as 89,327 entities may qualify as “small governmental jurisdictions.” Thus, the Commission estimates that most governmental jurisdictions are small.
301. The rules adopted in the Order apply to broadband Internet access service providers. The Economic Census places these firms, whose services might include Voice over Internet Protocol (VoIP), in either of two categories, depending on whether the service is provided over the provider's own telecommunications facilities (
302. The broadband Internet access service provider industry has changed since this definition was introduced in 2007. The data cited above may therefore include entities that no longer provide broadband Internet access service, and may exclude entities that now provide such service. To ensure that this FRFA describes the universe of small entities that our action might affect, the Commission discusses in turn several different types of entities that might be providing broadband Internet access service. The Commission notes that, although the Commission has no specific information on the number of small entities that provide broadband Internet access service over unlicensed spectrum, the Commission includes these entities in our Final Regulatory Flexibility Analysis.
303.
304.
305. The Commission has included small incumbent LECs in this present RFA analysis. As noted above, a “small business” under the RFA is one that,
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313. The broadband Internet access service provider category covered by this Order may cover multiple wireless firms and categories of regulated wireless services. Thus, to the extent the wireless services listed below are used by wireless firms for broadband Internet access service, the proposed actions may have an impact on those small businesses as set forth above and further below. In addition, for those services subject to auctions, the Commission notes that, as a general matter, the number of winning bidders that claim to qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Also, the Commission does not generally track subsequent business size unless, in the context of assignments and transfers or reportable eligibility events, unjust enrichment issues are implicated.
314.
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321. On January 26, 2001, the Commission completed the auction of 422 C and F Block Broadband PCS licenses in Auction No. 35. Of the 35 winning bidders in that auction, 29 claimed small business status. Subsequent events concerning Auction 35, including judicial and agency determinations, resulted in a total of 163 C and F Block licenses being available for grant. On February 15, 2005, the Commission completed an auction of 242 C-, D-, E-, and F-Block licenses in Auction No. 58. Of the 24 winning bidders in that auction, 16 claimed small business status and won 156 licenses. On May 21, 2007, the Commission completed an auction of 33 licenses in the A, C, and F Blocks in Auction No. 71. Of the 12 winning bidders in that auction, five claimed small business status and won 18 licenses. On August 20, 2008, the Commission completed the auction of 20 C-, D-, E-, and F-Block Broadband PCS licenses in Auction No. 78. Of the eight winning bidders for Broadband PCS licenses in that auction, six claimed small business status and won 14 licenses.
322.
323. The auction of the 1,053 800 MHz SMR geographic area licenses for the General Category channels began on August 16, 2000, and was completed on September 1, 2000. Eleven bidders won 108 geographic area licenses for the General Category channels in the 800 MHz SMR band and qualified as small businesses under the $15 million size standard. In an auction completed on December 5, 2000, a total of 2,800 Economic Area licenses in the lower 80 channels of the 800 MHz SMR service were awarded. Of the 22 winning bidders, 19 claimed small business status and won 129 licenses. Thus, combining all four auctions, 41 winning bidders for geographic licenses in the 800 MHz SMR band claimed status as small businesses.
324. In addition, there are numerous incumbent site-by-site SMR licenses and licensees with extended implementation authorizations in the 800 and 900 MHz bands. The Commission does not know how many firms provide 800 MHz or 900 MHz geographic area SMR service pursuant to extended implementation authorizations, nor how many of these providers have annual revenues of no more than $15 million. One firm has over $15 million in revenues. In addition, the Commission does not know how many of these firms have 1,500 or fewer employees, which is the SBA-determined size standard. The Commission assumes, for purposes of this analysis, that all of the remaining extended implementation authorizations are held by small entities, as defined by the SBA.
325.
326. In 2007, the Commission reexamined its rules governing the 700
327.
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331. As of March 2010, there were 424,162 PLMR licensees operating 921,909 transmitters in the PLMR bands below 512 MHz. The Commission notes that any entity engaged in a commercial activity is eligible to hold a PLMR license, and that any revised rules in this context could therefore potentially impact small entities covering a great variety of industries.
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341. In 2009, the Commission conducted Auction 86, the sale of 78 licenses in the BRS areas. The Commission offered three levels of bidding credits: (i) A bidder with attributed average annual gross revenues that exceed $15 million and do not exceed $40 million for the preceding three years (small business) received a 15 percent discount on its winning bid; (ii) a bidder with attributed average annual gross revenues that exceed $3 million and do not exceed $15 million for the preceding three years (very small business) received a 25 percent discount on its winning bid; and (iii) a bidder with attributed average annual gross revenues that do not exceed $3 million for the preceding three years (entrepreneur) received a 35 percent discount on its winning bid. Auction 86 concluded in 2009 with the sale of 61 licenses. Of the ten winning bidders, two bidders that claimed small business status won 4 licenses; one bidder that claimed very small business status won three licenses; and two bidders that claimed entrepreneur status won six licenses.
342. In addition, the SBA's Cable Television Distribution Services small business size standard is applicable to EBS. There are presently 2,436 EBS licensees. All but 100 of these licenses are held by educational institutions. Educational institutions are included in this analysis as small entities. Thus, the Commission estimates that at least 2,336 licensees are small businesses. Since 2007, Cable Television Distribution Services have been defined within the broad economic census category of Wired Telecommunications Carriers; that category is defined as follows: “This industry comprises establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies.” The SBA has developed a small business size standard for this category, which is: All such firms having 1,500 or fewer employees. To gauge small business prevalence for these cable services the Commission must, however, use the most current census data that are based on the previous category of Cable and Other Program Distribution and its associated size standard; that size standard was: All such firms having $13.5 million or less in annual receipts. According to Census Bureau data for 2007, there were a total of 996 firms in this category that operated for the entire year. Of this total, 948 firms had annual receipts of under $10 million, and 48 firms had receipts of $10 million or more but less than $25 million. Thus, the majority of these firms can be considered small.
343.
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348. The category of Satellite Telecommunications “comprises establishments primarily engaged in providing telecommunications services to other establishments in the telecommunications and broadcasting industries by forwarding and receiving communications signals via a system of satellites or reselling satellite telecommunications.” For this category, Census Bureau data for 2007 show that there were a total of 570 firms that operated for the entire year. Of this total, 530 firms had annual receipts of under $30 million, and 40 firms had receipts of over $30 million. Consequently, the Commission estimates that the majority of Satellite Telecommunications firms are small entities that might be affected by our action.
349. The second category of Other Telecommunications comprises,
350. Because section 706 requires us to monitor the deployment of broadband using any technology, the Commission anticipates that some broadband service providers may not provide telephone service. Accordingly, the Commission describes below other types of firms that may provide broadband services, including cable companies, MDS providers, and utilities, among others.
351.
352.
353.
354. The open video system (“OVS”) framework was established in 1996, and is one of four statutorily recognized options for the provision of video
355.
356. In the Report and Order, the Commission requires all rate-of-return ETCs to submit annually a list of the geocoded locations to which they have newly deployed facilities capable of delivering broadband in lieu of annual narrative reporting. To lessen the burden, in the Report and Order the Commission directs the Bureau to work with USAC to develop an online portal that will enable carriers to submit the requisite information on a rolling basis throughout the year as construction is completed and service becomes commercially available, with any final submission no later than March 1 of the following year.
357. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include (among others) the following four alternatives: (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities. The Commission has considered all of these factors subsequent to receiving substantive comments from the public and potentially affected entities. The Commission has considered the economic impact on small entities, as identified in comments filed in response to the
358. The rules that the Commission adopts in the Report and Order and Order and Order on Reconsideration take steps to provide greater certainty and flexibility to rate-of-return carriers, many of which are small entities. For example, the Commission adopts a voluntary path for rate-of-return carriers to elect to receive model-based support in exchange for deploying broadband-capable networks to a pre-determined number of eligible locations. The Commission recognizes that permitting rate-of-return carriers to elect to receive specific and predictable monthly support amounts over the ten years will enhance the ability of these carriers to deploy broadband throughout the term and free them from the administrative burdens associated with doing cost studies to receive high-cost support. Additionally, to provide further flexibility, the Commission adopts even-spaced annual interim milestones over the 10-year term for rate-of-return carriers electing model-based support, and decline to set interim milestones requiring deployment of speeds at or above 25/3 Mbps. By doing so, the Commission minimizes deployment burdens by permitting flexibility in design and deployment of broadband networks. The Commission also concludes that rate-of-return carriers receiving model-based support should have some flexibility in their deployment obligations to address unforeseeable challenges to meeting these obligations. Therefore, the Commission permitted rate-of-return carriers to deploy to 95 percent of the required number of locations by the end of the 10-year term.
359. In the Report and Order, the Commission also removes a deterrent for rate-of-return carriers to offer standalone broadband service by making technical rule changes to our existing ICLS rules to support the provision of broadband service to consumers in areas with high loop-related costs (including small carriers and those that wish to transfer or acquire parts of exchanges), without regard to whether the loops are also used for traditional voice services. By supporting broadband lines, the Commission removes potential regulatory barriers to taking steps to offer new IP-based services in innovative ways, and provides rate-of-return carriers strategic flexibility in their service offerings.
360. The Commission adopts a mechanism to limit operating costs eligible for support under HCLS and CAF BLS to encourage efficient spending by rate-of-return carriers and increase the amount of universal service support available for investment in broadband-capable facilities. However, to soften the impact of this expense limitation, the Commission concludes that a transition is appropriate to allow carriers time to adjust their operating expenditures. The Commission also adopts a capex allowance proposed by the rate-of-return industry associations to help target support to those areas
361. Next, in the Report and Order, the Commission takes steps to prohibit rate-of-return carriers from receiving CAF BLS in areas that are served by a qualifying unsubsidized competitor. However, the Commission limits the reduction in support to only those census blocks that are overlapped in at least 85 percent of their locations. The Commission recognized that competitive areas are likely to be lower cost and non-competitive areas are likely to be relatively higher cost, and therefore ensured that rate-of-return carriers subject to this rule may disaggregate their support in areas determined to be served by qualifying competitors by one of several options. The Commission provides further flexibility to those rate-of-return carriers affected by this rule by adopting a phased reduction in disaggregated support for competitive areas. By permitting this flexibility, the Commission provides these small entities with the ability to make reasoned business decisions to advance their deployment goals.
362. To promote “accountability from companies receiving support to ensure that public investments are used wisely to deliver intended results,” the Commission adopts defined deployment obligations that are a condition of the receipt of high-cost funding for those carriers continuing to receive support based on embedded costs. To provide rate-of-return carriers with the certainty needed to invest in their networks, the Commission adopted a specific methodology to determine each carrier's deployment obligation over a defined five-year period, which will be used to monitor carrier performance. The Commission recognizes that rate-of-return carriers subject to defined five-year deployment obligations may choose different timelines to meet their deployment obligations and therefore allows carriers the flexibility to choose to meet their obligation at any time during the five-year period.
363. In modifying its pricing rules, the Commission minimizes the burden on small carriers by deriving the costs for the Consumer Broadband-Only Loop category using existing data and allows NECA to tariff the Consumer Broadband-Only Loop rate for carriers electing model-based support because of the administrative efficiencies of employing a single tariff. The Commission also consolidates the certification that consumer broadband-only loop costs are not being double recovered into an existing certification, thus streamlining the process for small carriers.
364. The Commission also takes action to modify our existing reporting requirements. The Commission revises ETCs' annual reporting requirements to align better those requirements with the Commission's statutory and regulatory objectives. To reduce the administrative burden on rate-of-return carriers, the Commission concludes that the public interest would be served by eliminating the requirement to file a narrative update to the five-year plan. Instead, the Commission adopts narrowly tailored reporting requirements regarding the location of new deployment offering service at various speeds, which will better enable the Commission to determine on an annual basis how high-cost support is being used to “improve broadband availability, service quality, and capacity at the smallest geographic area possible.” Taken as a whole, these modifications to the reporting requirements for rate-of-return carriers will reduce their administrative burden and provide certainty as to what must be filed and when.
365. In the Order and Order on Reconsideration, the Commission is particularly mindful of the economic impact rate represcription will have on rate-of-return incumbent LECs, many of which are small entities. Accordingly, the Commission takes a number of steps to minimize the economic impact of the new rate of return. As an initial matter, the Commission expands the upper end of the rate of return zone of reasonableness beyond the WACC estimates obtained using financial models based on policy considerations and adopt the rate of return from the upper end of this zone. In so doing, the Commission attempts to maximize the likelihood that the unitary rate of return is fully compensatory, even for small firms with a relatively high cost of capital. In addition, to help minimize the immediate financial impacts that represcription may impose on small carriers, the Commission adopts, for the first time, a transitional approach to represcription. Under this approach, the rate of return is reduced by 25 basis points per year beginning July 1, 2016 until it reaches the represcribed 9.75 percent rate of return. Together, these measures are intended to reduce the significant economic impact of the new rate of return on small carriers.
366. The Commission will send a copy of the Order, including this FRFA, in a report to be sent to Congress and the Government Accountability Office pursuant to the Small Business Regulatory Enforcement Fairness Act of 1996. In addition, the Commission will send a copy of the Order, including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the Order and FRFA (or summaries thereof) will also be published in the
367. The Commission will send a copy of this Report and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act,
368.
369.
370. Accordingly, IT IS ORDERED, pursuant to the authority contained in sections 1, 2, 4(i), 5, 10, 201-206, 214, 218-220, 251, 252, 254, 256, 303(r), 332, 403, and 405 of the Communications Act of 1934, as amended, and section 706 of the Telecommunications Act of 1996, 47 U.S.C. 151, 152, 154(i), 155, 201-206, 214, 218-220, 251, 252, 254, 256, 303(r), 332, 403, 405, 1302, and sections 1.1, 1.3, 1.421, 1.427, and 1.429 of the Commission's rules, 47 CFR 1.1, 1.3, 1.421, 1.427, and 1.429, that this Report and Order, Order and Order on Reconsideration, and concurrently adopted Further Notice of Proposed Rulemaking IS ADOPTED, effective thirty (30) days after publication of the text or summary thereof in the
371. IT IS FURTHER ORDERED that parts 51, 54, 65, and 69 of the Commission's rules, 47 CFR parts 51, 54, 65, and 69, ARE AMENDED as set forth in Appendix B, and such rule amendments SHALL BE EFFECTIVE thirty (30) days after publication of the rules amendments in the
372. IT IS FURTHER ORDERED that pursuant to Section 1.3 of the Commission's rules, 47 CFR 1.3, sections 65.300 and 65.303 of the Commission's rules, 47 CFR 65.300, 65.303, are WAIVED to the extent provided herein.
373. IT IS FURTHER ORDERED that, pursuant to the authority contained in sections 1, 2, 4(i), 5, 10, 201-206, 214, 218-220, 251, 252, 254, 256, 303(r), 332, 403, and 405 of the Communications Act of 1934, as amended, and section 706 of the Telecommunications Act of 1996, 47 U.S.C. 151, 152, 154(i), 155, 201-206, 214, 218-220, 251, 252, 254, 256, 303(r), 332, 403, 405, 1302, and sections 1.1, 1.3, 1.421, 1.427, and 1.429 of the Commission's rules, 47 CFR 1.1, 1.3, 1.421, 1.427, and 1.429, NOTICE IS HEREBY GIVEN of the proposals and tentative conclusions described in this Further Notice of Proposed Rulemaking.
374. IT IS FURTHER ORDERED that pursuant section 1.429(i) of the Commission's rules, 47 CFR 1.429(i), that the Petition for Reconsideration and Clarification of the National Exchange Carrier Association, Inc., Organization for the Promotion and Advancement of Small Telecommunications Companies, and Western Telecommunications Alliance, filed December 29, 2011, is DISMISSED and DENIED to the extent provided herein.
375. IT IS FURTHER ORDERED that the Commission SHALL SEND a copy of this Report and Order, Order and Order on Reconsideration, and concurrently adopted Further Notice of Proposed Rulemaking to Congress and the Government Accountability Office pursuant to the Congressional Review Act,
376. IT IS FURTHER ORDERED, that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, SHALL SEND a copy of this Report and Order, Order and Order on Reconsideration, and concurrently adopted Further Notice of Proposed Rulemaking, including the Initial Regulatory Flexibility Analysis and the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.
Communications common carriers, Telecommunications.
Communications common carriers, Health facilities, Infants and children, Internet, Libraries, Reporting and recordkeeping requirements, Schools, Telecommunications, Telephone.
Administrative practice and procedure, Communications common carriers, Reporting and recordkeeping requirements, Telephone.
Communications common carriers, Reporting and recordkeeping requirements, Telephone.
For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR parts 51, 54, 65, and 69 as follows:
47 U.S.C. 151-55, 201-05, 207-09, 218, 220, 225-27, 251-54, 256, 271, 303(r), 332, 1302.
(f) * * *
(4) A Rate-of-Return Carrier must impute an amount equal to the Access Recovery Charge for each Consumer Broadband-Only Loop line that receives support pursuant to § 54.901 of this chapter, with the imputation applied before CAF-ICC recovery is determined. The per line per month imputation amount shall be equal to the Access Recovery Charge amount prescribed by paragraph (e) of this section, consistent with the residential or single-line business or multi-line business status of the retail customer.
47 U.S.C. 151, 154(i), 155, 201, 205, 214, 219, 220, 254, 303(r), 403, and 1302 unless otherwise noted.
(a)
(1) Total eligible annual operating expenses per location shall be limited as follows plus one standard deviation:
(2) Eligible operating expenses are the sum of Cable and Wire Facilities Expense, Central Office Equipment Expense, Network Support and General Expense, Network Operations Expense, Limited Corporate Operations Expense, Information Origination/Termination Expense, Other Property Plant and Equipment Expenses, Customer Operations Expense: Marketing, and Customer Operations Expense: Services.
(3) For purposes of this section, the number of housing units will be determined per the most recently available U.S Census data for each census block in that study area. If a census block is partially within a study area, the number of housing units in that portion of the census block will be determined based upon the percentage geographic area of the census block within the study area.
(4) Notwithstanding the provisions of paragraph (a) of this section, total eligible annual operating expenses for 2016 will be limited to the total eligible annual operating expenses as defined in this section plus one half of the amount of total eligible annual expense as calculated prior to the application of this section.
(5) For any study area subject to the limitation described in this paragraph, a required percentage reduction will be calculated for that study area's total eligible annual operating expenses. Each category or account used to determine that study area's total eligible annual operating expenses will then be reduced by this required percentage reduction.
(b)
(c)
(1)
(2)
(3)
(4)
(5)
(d)
(e)
(f)
(1) Maximum Average Per Location Construction Project Loop Plant Investment Limitation equals the inflation adjusted equivalent to $10,000 in the Reference Year calculated by multiplying $10,000 times the applicable annual GDP-CPI. This inflation adjusted amount will be normalized across all study areas by multiplying the product above by (the Loop Cap Adjustment Factor times the Construction Limit Factor)
(2) This limitation shall apply only with respect to Loop Plant Investment for which invoices were received by the carrier after the effective date of this rule.
(3) A carrier subject to this section will maintain documentation necessary to demonstrate compliance with the above limitation.
(g)
(1) AALPI
(2) The Broadband Deployment AALPI Adjustment
(3) The Maximum Average Per Location Construction Project Loop Plant Investment Limitation
(4) The Loop Cap Adjustment Factor
(5) The Construction Limit Factor
(h)
(i) A carrier subject to this section will maintain subsidiary records of accumulated Excess Loop Plant Investment for accounts referenced in paragraph (c)(1) of this section in addition to the corresponding depreciation accounts. In the event a carrier makes Loop Plant Investment for an account at a level below the AALPI for the account, the carrier may reduce accumulated Excess Loop Plant Investment effective for the Reference Year by an amount up to, but not in
(j)
(k)
(1) Geographic areas within the study area where there are currently no existing wireline loop facilities;
(2) Geographic areas within the study area where grant funds are used for Loop Plant Investment;
(3) Geographic areas within the study area for which loan funds were disbursed for the purposes of Loop Plant Investment before the effective date of this rule; and
(4) Construction projects for which the carrier, prior to the effective date of this rule, had awarded a contract to a vendor for a loop plant construction project within the study area.
(l)
(m)
(a) The provisions of this section shall not be used to determine support for any price cap incumbent local exchange carrier or a rate-of-return carrier, as that term is defined in § 54.5, that is affiliated with a price cap incumbent local exchange carrier.
(a) Rate-of-return carrier recipients of high-cost support are required to offer broadband service, at speeds described below, with latency suitable for real-time applications, including Voice over Internet Protocol, and usage capacity that is reasonably comparable to comparable offerings in urban areas, at rates that are reasonably comparable to rates for comparable offerings in urban areas. For purposes of determining reasonable comparability of rates, recipients are presumed to meet this requirement if they offer rates at or below the applicable benchmark to be announced annually by public notice issued by the Wireline Competition Bureau.
(1) Carriers that elect to receive Connect America Fund-Alternative Connect America Cost Model (CAF-ACAM) support pursuant to § 54.311 are required to offer broadband service at actual speeds of at least 10 Mbps downstream/1 Mbps upstream to a defined number of locations as specified by public notice, with a minimum usage allowance of 150 GB per month, subject to the requirement that usage allowances remain consistent with median usage in the United States over the course of the ten-year term. In addition, such carriers must offer other speeds to subsets of locations, as specified below:
(i)
(A) Carriers with a state-level density of more than 10 housing units per square mile, as specified by public notice at the time of election, are required to offer broadband speeds of at least 25 Mbps downstream/3 Mbps upstream to 75 percent of all fully funded locations in the state by the end of the ten-year period.
(B) Carriers with a state-level density of 10 or fewer, but more than five, housing units per square mile, as specified by public notice at the time of election, are required to offer broadband speeds of at least 25 Mbps downstream/3 Mbps upstream to 50 percent of fully funded locations in the state by the end of the ten-year period.
(C) Carriers with a state-level density of five or fewer housing units per square mile, as specified by public notice at the time of election, are required to offer broadband speeds of at least 25 Mbps downstream/3 Mbps upstream to 25 percent of fully funded locations in the state by the end of the ten-year period.
(ii)
(A) Carriers with a state-level density of more than 10 housing units per square mile, as specified by public notice at the time of election, are required to offer broadband speeds of at least 4 Mbps downstream/1 Mbps upstream to 50 percent of all capped locations in the state by the end of the ten-year period.
(B) Carriers with a state-level density of 10 or fewer housing units per square mile, as specified by public notice at the time of election, are required to offer broadband speeds of at least 4 Mbps downstream/1 Mbps upstream to 25 percent of capped locations in the state by the end of the ten-year period.
(C) Carriers shall provide to all other capped locations, upon reasonable request, broadband at actual speeds of at least 4 Mbps downstream/1 Mbps upstream.
(2) Rate-of-return recipients of Connect America Fund Broadband Loop Support (CAF BLS) shall be required to offer broadband service at actual speeds of at least 10 Mbps downstream/1 Mbps upstream, over a five-year period, to a defined number of unserved locations as specified by public notice, as determined by the following methodology:
(i)
(A) Rate-of-return carriers with less than 20 percent deployment of 10/1 Mbps broadband service in their study areas, as determined by the Wireline Competition Bureau, will be required to utilize 35 percent of their five-year forecasted CAF-BLS support to extend broadband service where it is currently lacking.
(B) Rate-of-return carriers with more than 20 percent but less than 40 percent deployment of 10/1 Mbps broadband service in their study areas, as determined by the Wireline Competition
(C) Rate-of-return carriers with more than 40 percent but less than 80 percent deployment of 10/1 Mbps broadband service in their study areas, as determined by the Wireline Competition Bureau, will be required to utilize 20 percent of their five-year forecasted CAF-BLS support to extend broadband service where it is currently lacking.
(ii)
(A) The higher of:
(
(
(B) The average cost per location for census blocks lacking 10/1 Mbps broadband service in the carrier's study area as determined by the A-CAM.
(iii)
(B) No rate-of-return carrier shall deploy terrestrial wireline technology to unserved locations to meet this obligation if that would exceed the $10,000 per location/per project capital investment allowance set forth in § 54.303.
(iv)
(a)
(b)
(c)
(d)
(e)
(1) If the difference between a carrier's model-based support and its 2015 high-cost support, as determined in paragraph (e)(4) of this section, is 10 percent or less, it will receive, in addition to model-based support, 50 percent of that difference in year one, and then will receive model support in years two through ten.
(2) If the difference between a carrier's model-based support and its 2015 high-cost support, as determined in paragraph (e)(4) of this section, is 25 percent or less, but more than 10 percent, it will receive, in addition to model-based support, an additional transition payment for up to four years, and then will receive model support in years five through ten. The transition payments will be phased-down 20 percent per year, provided that each phase-down amount is at least five percent of the total 2015 high-cost support amount. If 20 percent of the difference between a carrier's model-based support and its 2015 high-cost support is less than five percent of the total 2015 high-cost support amount, the transition payments will be phased-down five percent of the total 2015 high-cost support amount each year.
(3) If the difference between a carrier's model-based support and its 2015 high-cost support, as determined in paragraph (e)(4) of this section, is more than 25 percent, it will receive, in addition to model-based support, an additional transition payment for up to nine years, and then will receive model support in year ten. The transition payments will be phased-down ten percent per year, provided that each phase-down amount is at least five percent of the total 2015 high-cost support amount. If ten percent of the difference between a carrier's model-based support and its 2015 high-cost support is less than five percent of the total 2015 high-cost support amount, the transition payments will be phased-
(4) The carrier's 2015 support for purposes of the calculation of transition payments is the amount of high-cost loop support and interstate common line support disbursed to the carrier for 2015 without regard to prior period adjustments related to years other than 2015, as determined by the Administrator as of January 31, 2016 and publicly announced prior to the election period for the voluntary path to the model.
The revisions read as follows:
(a) * * *
(10)
(e) * * *
(1) On July 1, 2016, a list of the geocoded locations already meeting the § 54.309 public interest obligations at the end of calendar year 2015, and the total amount of Phase II support, if any, the price cap carrier used for capital expenditures in 2015.
(2) On July 1, 2017, and every year thereafter ending July 1, 2021, the following information:
(f) * * *
(1)
(i) A certification that it is taking reasonable steps to provide upon reasonable request broadband service at actual speeds of at least 10 Mbps downstream/1 Mbps upstream, with latency suitable for real-time applications, including Voice over Internet Protocol, and usage capacity that is reasonably comparable to comparable offerings in urban areas as determined in an annual survey, and that requests for such service are met within a reasonable amount of time.
(iii) A certification that it bid on category one telecommunications and Internet access services in response to all reasonable requests in posted FCC Form 470s seeking broadband service that meets the connectivity targets for the schools and libraries universal service support program for eligible schools and libraries (as described in § 54.501) within its service area, and that such bids were at rates reasonably comparable to rates charged to eligible schools and libraries in urban areas for comparable offerings.
(a)
(1) Recipients of high-cost support with defined broadband deployment obligations pursuant to § 54.308(a) or § 54.310(c) shall provide to the Administrator on a recurring basis information regarding the locations to which the eligible telecommunications carrier is offering broadband service in satisfaction of its public interest obligations, as defined in either § 54.308 or § 54.309.
(2) Recipients subject to the requirements of § 54.308(a)(1) shall report the number of locations for each state and locational information, including geocodes, separately indicating whether they are offering service providing speeds of at least 4 Mbps downstream/1 Mbps upstream, 10 Mbps downstream/1 Mbps upstream, and 25 Mbps downstream/3 Mbps upstream.
(3) Recipients subject to the requirements of § 54.308(a)(2) shall report the number of newly served locations for each study area and locational information, including geocodes, separately indicating whether they are offering service providing speeds of at least 4 Mbps downstream/1 Mbps upstream, 10 Mbps downstream/1 Mbps upstream, and 25 Mbps downstream/3 Mbps upstream.
(4) Recipients subject to the requirements of § 54.310(c) shall report the number of locations for each state and locational information, including geocodes, where they are offering service providing speeds of at least 10 Mbps downstream/1 Mbps upstream.
(b)
(1) Price cap carriers that elect to receive Connect America Phase II model-based support shall provide: No later than March 1, 2017, and every year thereafter ending on no later than March 1, 2021, a certification that by the end of the prior calendar year, it was offering broadband meeting the requisite public interest obligations specified in § 54.309 to the required percentage of its supported locations in each state as set forth in § 54.310(c).
(2) Rate-of-return carriers electing CAF-ACAM support pursuant to § 54.311 shall provide:
(i) No later than March 1, 2021, and every year thereafter ending on no later than March 1, 2027, a certification that by the end of the prior calendar year, it was offering broadband meeting the requisite public interest obligations specified in § 54.308 to the required percentage of its fully funded locations in the state, pursuant to the interim deployment milestones set forth in § 54.311(d).
(ii) No later than March 1, 2027, a certification that as of December 31, 2026, it was offering broadband meeting the requisite public interest obligations specified in § 54.308 to all of its fully funded locations in the state and to the required percentage of its capped locations in the state.
(3) Rate-of-return carriers receiving support pursuant to subparts K and M of this part shall provide:
(i) No later than March 1, 2022, a certification that it fulfilled the deployment obligation meeting the requisite public interest obligations as specified in § 54.308(a)(2) to the required number of locations as of December 31, 2021.
(ii) Every subsequent five-year period thereafter, a certification that it fulfilled the deployment obligation meeting the requisite public interest obligations as specified in § 54.308(a)(4).
(c)
(i) An eligible telecommunications carrier that files after the March 1 deadline, but by February 7, will have
(ii) An eligible telecommunications carrier that files on or after February 8 will have its support reduced on a pro-rata daily basis equivalent to the period of non-compliance, plus the minimum seven-day reduction,
(2)
(a) High-cost loop support provided pursuant to subparts K and M of this part shall be eliminated in an incumbent rate-of-return local exchange carrier study area where an unsubsidized competitor, or combination of unsubsidized competitors, as defined in § 54.5, offer(s) to 100 percent of the residential and business locations in the study area voice and broadband service at speeds of at least 10 Mbps downstream/1 Mbps upstream, with latency suitable for real-time applications, including Voice over Internet Protocol, and usage capacity that is reasonably comparable to comparable offerings in urban areas, at rates that are reasonably comparable to rates for comparable offerings in urban areas.
(d) High-cost universal service support pursuant to subpart K of this part shall be eliminated for those census blocks of an incumbent rate-of-return local exchange carrier study area where an unsubsidized competitor, or combination of unsubsidized competitors, as defined in § 54.5, offer(s) voice and broadband service meeting the public interest obligations in § 54.308(a)(2) to at least 85 percent of residential locations in the census block. Qualifying competitors must be able to port telephone numbers from consumers.
(e) After a determination that a particular census block is served by a competitor as defined in paragraph (d) of this section, support provided pursuant to subpart K of this part shall be disaggregated pursuant to a method elected by the incumbent local exchange carrier. The sum of support that is disaggregated for competitive and non-competitive areas shall equal the total support available to the study area without disaggregation.
(f) For any incumbent local exchange carrier for which the disaggregated support for competitive census blocks represents less than 25 percent of the support the carrier would have received in the study area in the absence of this rule, support provided pursuant to subpart K of this part shall be reduced according to the following schedule:
(1) In the first year, 66 percent of the incumbent's disaggregated support for the competitive census block will be provided;
(2) In the second year, 33 percent of the incumbent's disaggregated support for the competitive census blocks will be provided;
(3) In the third year and thereafter, no support shall be provided pursuant to subpart K of this part for any competitive census block.
(g) For any incumbent local exchange carrier for which the disaggregated support for competitive census blocks represents more than 25 percent of the support the carrier would have received in the study area in the absence of this rule, support shall be reduced for each competitive census block according to the following schedule:
(1) In the first year, 85 percent of the incumbent's disaggregated support for the competitive census blocks will be provided;
(2) In the second year, 68 percent of the incumbent's disaggregated support for the competitive census blocks will be provided;
(3) In the third year, 51 percent of the incumbent's disaggregated support for the competitive census blocks will be provided;
(4) In the fourth year, 34 percent of the incumbent's disaggregated support the competitive census block will be provided;
(5) In the fifth year, 17 percent of the incumbent's disaggregated support the competitive census blocks will be provided;
(6) In the sixth year and thereafter, no support shall be paid provided pursuant to subpart K of this part for any competitive census block.
(h) The Wireline Competition Bureau shall update its analysis of competitive overlap in census blocks every seven years, utilizing the current public interest obligations in § 54.308(a)(2) as the standard that must be met by an unsubsidized competitor.
(a) The Administrator shall have the authority to audit contributors and carriers reporting data to the Administrator. The Administrator shall establish procedures to verify discounts, offsets and support amounts provided by the universal service support programs, and may suspend or delay discounts, offsets, and support amounts provided to a carrier if the carrier fails to provide adequate verification of discounts, offsets, or support amounts provided upon reasonable request, or if directed by the Commission to do so. The Administrator shall not provide reimbursements, offsets or support amounts pursuant to subparts D, K, L and M of this part to a carrier until the carrier has provided to the Administrator a true and correct copy of the decision of a state commission designating that carrier as an eligible telecommunications carrier in accordance with § 54.202.
(b) The Administrator has the right to obtain all cost and revenue submissions and related information, at any time and in unaltered format, that carriers submit to NECA that are used to calculate support payments pursuant to subparts D, K, and M of this part.
(c) The Administrator (and NECA, to the extent the Administrator does not directly receive information from carriers) shall provide to the Commission upon request all underlying data collected from eligible telecommunications carriers to calculate payments pursuant to subparts D, K, L and M of this part.
(a) Connect America Fund Broadband Loop Support (CAF BLS) available to a rate-of-return carrier shall equal the Interstate Common Line Revenue Requirement per Study Area, plus the Consumer Broadband-Only Revenue Requirement per Study Area as calculated in accordance with part 69 of this chapter, minus:
(1) The study area revenues obtained from end user common line charges at their allowable maximum as determined by § 69.104(n) and (o) of this chapter;
(2) Imputed Consumer Broadband-only Revenues, to be calculated as:
(i) The lesser of $42 * the number of consumer broadband-only loops * 12 or the Consumer Broadband-Only Revenue Requirement per Study Area; or
(ii) For the purpose of calculating the reconciliation pursuant to § 54.903(b)(3), the greater of the amount determined pursuant to paragraph (a)(2)(i) of this section or the carrier's allowable Consumer Broadband-only rate calculated pursuant to § 69.132 of this chapter * the number of consumer broadband-only loops * 12;
(3) The special access surcharge pursuant to § 69.115 of this chapter; and
(4) The line port costs in excess of basic analog service pursuant to § 69.130 of this chapter.
(b) For the purpose of calculating support pursuant to paragraph (a) of this section, the Interstate Common Line Revenue Requirement and Consumer Broadband-only Revenue Requirement shall be subject to the limits on operating expenses and capital investment allowances pursuant to § 54.303.
(c) For purposes of calculating the amount of CAF BLS, determined pursuant to paragraph (a) of this section, that a non-price cap carrier may receive, the corporate operations expense allocated to the Common Line Revenue Requirement or the Consumer Broadband-only Loop Revenue Requirement, pursuant to § 69.409 of this chapter, shall be limited to the lesser of:
(1) The actual average monthly per-loop corporate operations expense; or
(2) The portion of the monthly per-loop amount computed pursuant to § 54.1308(a)(4)(iii) that would be allocated to the Interstate Common Line Revenue Requirement or Consumer Broadband-only Loop Revenue Requirement pursuant to § 69.409 of this chapter.
(d) In calculating support pursuant to paragraph (a) of this section for periods prior to when the tariff charge described in § 69.132 of this chapter becomes effective, only Interstate Common Line Revenue Requirement and Interstate Common line revenues shall be included.
(e) To the extent necessary for ratemaking purposes, each carrier's CAF BLS shall be attributed as follows:
(1) First, support shall be applied to ensure that the carrier has met its Interstate Common Line Revenue Requirement for the prior period to which true-up payments are currently being applied.
(2) Second, support shall be applied to ensure that the carrier has met its Consumer Broadband-only Loop Revenue Requirement for the prior period to which true-up payments are currently being applied.
(3) Third, support shall be applied to ensure that the carrier will meet, on a forecasted basis, its Interstate Common Line Revenue Requirement during the current tariff year.
(4) Finally, support shall be applied as available to the Consumer Broadband-only Loop Revenue Requirement during the current tariff year.
(f) CAF BLS Support is subject to a reduction as necessary to meet the overall cap on support established by the Commission for support provided pursuant to this subpart and subpart M of this part. Reductions shall be implemented as follows:
(1) On May 1 of each year, the Administrator will publish a target amount for CAF BLS in the aggregate and the amount of CAF BLS that each study area will receive during the upcoming July 1 to June 30 tariff year. The target amount shall be the forecasted disbursement amount times a reduction factor. The reduction factor shall be the budget amount divided by the total forecasted disbursement amount for both High Cost Loop Support and CAF BLS for recipients in the aggregate. The forecasted disbursement for CAF BLS is the forecasted total disbursements for all recipients of CAF BLS, including both projections and true-ups in the upcoming July 1 to June 30 tariff year.
(2) The Administrator shall apply a per-line reduction to each carrier's CAF BLS equal to one-half the difference between the forecasted disbursement amount and the target amount divided by the total number of loops eligible for support. To the extent that per-line reduction is greater than the amount of CAF BLS per loop for a given carrier, that excess amount shall be subject to reduction through the method described in paragraph (f)(3) of this section.
(3) The Administrator shall apply an additional pro rata reduction to CAF BLS for each recipient of CAF BLS as necessary to achieve the target amount.
(g) For purposes of this subpart and consistent with § 69.132 of this chapter, a consumer broadband-only loop is a line provided by a rate-of-return incumbent local exchange carrier to a customer without regulated local exchange voice service, for use in connection with fixed Broadband Internet access service, as defined in § 8.2 of this chapter.
(a) In the event that a rate-of-return carrier acquires exchanges from an entity that is also a rate-of-return carrier, CAF BLS for the transferred exchanges shall be distributed as follows:
(1) Each carrier may report its updated line counts to reflect the transfer in the next quarterly line count filing pursuant to § 54.903(a)(1) that applies to the period in which the transfer occurred. During a transition period from the filing of the updated line counts until the end of the funding year, the Administrator shall adjust the CAF BLS Support received by each carrier based on the updated line counts and the per-line CAF BLS, categorized by customer class and, if applicable, disaggregation zone, of the selling carrier. If the acquiring carrier does not file a quarterly update of its line counts, it will not receive CAF BLS for those lines during the transition period.
(2) Each carrier's projected data for the following funding year filed pursuant to § 54.903(a)(3) shall reflect the transfer of exchanges.
(3) Each carrier's actual data filed pursuant to § 54.903(a)(4) shall reflect the transfer of exchanges. All post-transaction CAF BLS shall be subject to true up by the Administrator pursuant to § 54.903(b)(3).
(b) In the event that a rate-of-return carrier acquires exchanges from a price-cap carrier, absent further action by the Commission, the exchanges shall receive the same amount of support and be subject to the same public interest obligations as specified in § 54.310 or § 54.312, as applicable.
(c) In the event that an entity other than a rate-of-return carrier acquires exchanges from a rate-of-return carrier, absent further action by the Commission, the carrier will receive model-based support and be subject to public interest obligations as specified in § 54.310.
(d) This section does not alter any Commission rule governing the sale or transfer of exchanges, including the definition of “study area” in part 36 of this chapter.
(a) To be eligible for CAF BLS, each rate-of-return carrier shall make the following filings with the Administrator.
(1) Each rate-of-return carrier shall submit to the Administrator in accordance with the schedule in § 54.1306 the number of lines it serves, within each rate-of-return carrier study area showing residential and single-line business line counts, multi-line business line counts, and consumer broadband-only line counts separately. For purposes of this report, and for purposes of computing support under this subpart, the residential and single-
(2) A rate-of-return carrier may submit the information in paragraph (a) of this section in accordance with the schedule in § 54.1306, even if it is not required to do so. If a rate-of-return carrier makes a filing under this paragraph, it shall separately indicate any lines that it has acquired from another carrier that it has not previously reported pursuant to paragraph (a) of this section, identified by customer class and the carrier from which the lines were acquired.
(3) Each rate-of-return carrier shall submit to the Administrator annually by March 31 projected data necessary to calculate the carrier's prospective CAF BLS, including common line and consumer broadband-only loop cost and revenue data, for each of its study areas in the upcoming funding year. The funding year shall be July 1 of the current year through June 30 of the next year. The data shall be accompanied by a certification that the cost data is compliant with the Commission's cost allocation rules and does not reflect duplicative assignment of costs to the consumer broadband-only loop and special access categories.
(4) Each rate-of-return carrier shall submit to the Administrator on December 31 of each year the data necessary to calculate a carrier's Connect America Fund CAF BLS, including common line and consumer broadband-only loop cost and revenue data, for the prior calendar year. Such data shall be used by the Administrator to make adjustments to monthly per-line CAF BLS amounts to the extent of any differences between the carrier's CAF BLS received based on projected common line cost and revenue data, and the CAF BLS for which the carrier is ultimately eligible based on its actual common line and consumer broadband-only loop cost and revenue data during the relevant period. The data shall be accompanied by a certification that the cost data is compliant with the Commission's cost allocation rules and does not reflect duplicative assignment of costs to the consumer broadband-only loop and special access categories.
(b) Upon receiving the information required to be filed in paragraph (a) of this section, the Administrator shall:
(1) Perform the calculations described in § 54.901 and distribute support accordingly;
(2) [Reserved]
(3) Perform periodic reconciliation of the CAF BLS provided to each carrier based on projected data filed pursuant to paragraph (a)(3) of this section and the CAF BLS for which each carrier is eligible based on actual data filed pursuant to paragraph (a)(4) of this section; and
(4) Report quarterly to the Commission on the collection and distribution of funds under this subpart as described in § 54.702(h). Fund distribution reporting will be by state and by eligible telecommunications carrier within the state.
(a) For the purpose of calculating the expense adjustment, the study area total unseparated loop cost equals the sum of the following, however, subject to the limitations set forth in § 54.303:
(d) High Cost Loop Support is subject to a reduction as necessary to meet the overall cap on support established by the Commission for support provided pursuant to this subpart and subpart K of this chapter. Reductions shall be implemented as follows:
(1) On May 1 of each year, the Administrator will publish an annual target amount for High-Cost Loop Support in the aggregate. The target amount shall be the forecasted disbursement amount times a reduction factor. The reduction factor shall be the budget amount divided by the total forecasted disbursement amount for both High Cost Loop Support and Broadband Loop Support for recipients in the aggregate. The forecasted disbursement for High Cost Loop Support is the High Cost Loop Support cap determined pursuant to § 54.1302 as reflected in the most recent annual filing pursuant to § 54.1305.
(2) Each quarter, the Administrator shall adjust each carrier's High Cost Loop Support disbursements as follows:
(i) The Administrator shall apply a per-line reduction to each carrier's High Cost Loop Support equal to one-half the difference between the forecasted disbursement amount and the target amount divided by the total number of loops eligible for support. To the extent that per-line reduction is greater than the amount of High Cost Loop Support per loop for a given carrier, that excess amount will be subject to reduction through the method described in paragraph (d)(2)(ii) of this section.
(ii) The Administrator shall apply an additional pro rata reduction to High Cost Loop Support for each recipient of High Cost Loop Support as necessary to achieve the target amount.
47 U.S.C. 151, 154(i), 155, 201, 205, 214, 219, 220, 254, 303(r), 403, and 1302 unless otherwise noted.
The formula for determining the cost of debt is equal to:
47 U.S.C. 154, 201, 202, 203, 205, 218, 220, 254, 403.
(k) A non-price cap incumbent local exchange carrier may include a charge for the Consumer Broadband-Only Loop.
The revisions and addition read as follows:
(n)(1) Except as provided in paragraphs (r) and (s) of this section, the maximum monthly charge for each residential or single-line business local exchange service subscriber line shall be the lesser of:
(ii) $6.50.
(o)(1) Except as provided in paragraphs (r) and (s) of this section, the maximum monthly End User Common Line Charge for multi-line business lines will be the lesser of:
(s) End User Common Line Charges for incumbent local exchange carriers not subject to price cap regulation that elect model-based support pursuant to § 54.311 of this chapter are limited as follows:
(1) The maximum charge a non-price cap local exchange carrier that elects model-based support pursuant to § 54.311 of this chapter may assess for each residential or single-line business local exchange service subscriber line is the rate in effect on the last day of the month preceding the month for which model-based support is first provided.
(2) The maximum charge a non-price cap local exchange carrier that elects model-based support pursuant to § 54.311 of this chapter may assess for each multi-line business local exchange service subscriber line is the rate in effect on the last day of the month preceding the month for which model-based support is first provided.
(b) Except as provided in paragraph (f) of this section, such surcharge shall be computed to reflect a reasonable approximation of the carrier usage charges which, assuming non-premium interconnection, would have been paid for average interstate or foreign usage of common lines, end office facilities, and transport facilities, attributable to each Special Access line termination which is not exempt from assessment pursuant to paragraph (e) of this section.
(f) The maximum special access surcharge a non-price cap local exchange carrier that elects model-based support pursuant to § 54.311 of this chapter may assess is the rate in effect on the last day of the month preceding the month for which model-based support is first provided.
(a) To the extent that the costs of ISDN line ports, and line ports associated with other services, exceed the costs of a line port used for basic, analog service, non-price cap local exchange carriers may recover the difference through a separate monthly end-user charge, provided that no portion of such excess cost may be recovered through other common line access charges, or through Connect America Fund Broadband Loop Support.
(b) The maximum charge a non-price cap local exchange carrier that elects model-based support pursuant to § 54.311 of this chapter may assess is the rate in effect on the last day of the month preceding the month for which model-based support is first provided.
(a) This section is applicable only to incumbent local exchange carriers that are not subject to price cap regulation as that term is defined in § 61.3(ee) of this chapter.
(b) A charge that is expressed in dollars and cents per line per month may be assessed upon end users that subscribe to Consumer Broadband-Only Loop service. Such charge shall be assessed for each line without regulated local exchange voice service provided by a rate-of-return incumbent local exchange carrier to a customer, for use in connection with fixed Broadband Internet access service, as defined in § 8.2 of this chapter.
(c) For carriers not electing model-based support pursuant to § 54.311 of this chapter, the single-line rate or charge shall be computed by dividing one-twelfth of the projected annual revenue requirement for the Consumer Broadband-Only Loop category by the projected average number of consumer broadband-only service lines in use during such annual period.
(d) The maximum monthly per line charge for each Consumer Broadband-Only Loop provided by a non-price cap local exchange carrier that elects model-based support pursuant to § 54.311 of this chapter shall be $42.
(a) Each non-price cap local exchange carrier shall remove consumer broadband-only loop investment assigned to the special access category by §§ 69.301 through 69.310 from the special access category and assign it to the Consumer Broadband-Only Loop category when the tariff charge described in § 69.132 of this part becomes effective.
(b) The consumer broadband-only loop investment to be removed from the special access category shall be determined using the following estimation method.
(1) To determine the investment in Common Line facilities (Category 1.3) as if 100 percent were allocated to the interstate jurisdiction, a carrier shall use 100 percent as the interstate allocator in determining Category 1.3 investment and the allocation of investment to the common line category under part 36 of this chapter and this part.
(2) The result of paragraph (b)(1) of this section shall be divided by the number of voice and voice/data lines in the study area to produce an average investment per line.
(3) The average investment per line determined by paragraph (b)(2) of this section shall be multiplied by the
(a) Each non-price cap local exchange carrier shall remove consumer broadband-only loop expenses assigned to the Special Access category by §§ 69.401 through 69.415 from the special access category and assign them to the Consumer Broadband-Only Loop category when the tariff charge described in § 69.132 of this Part becomes effective.
(b) The consumer broadband-only loop expenses to be removed from the special access category shall be determined using the following estimation method.
(1) The expenses assigned to the Common Line category as if the common line expenses were 100 percent interstate shall be determined using the methodology employed in § 69.311(b)(1).
(2) The result of paragraph (b)(1) of this section shall be divided by the number of voice and voice/data lines in the study area to produce an average expense per line.
(3) The average expense per line determined by paragraph (b)(2) of this section shall be multiplied by the number of Consumer Broadband-only Loops in the study area to derive the expenses to be shifted from the Special Access category to the Consumer Broadband-only Loop category.
(g) The association shall divide the expenses of its operations into two categories. The first category (“Category I Expenses”) shall consist of those expenses that are associated with the preparation, defense, and modification of association tariffs, those expenses that are associated with the administration of pooled receipts and distributions of exchange carrier revenues resulting from association tariffs, those expenses that are associated with association functions pursuant to paragraphs (c) through (g) of this section, and those expenses that pertain to Commission proceedings involving this subpart. The second category (“Category II Expenses”) shall consist of all other association expenses. Category I Expenses shall be sub-divided into three components in proportion to the revenues associated with each component. The first component (“Category I.A Expenses”) shall be in proportion to High Cost Loop Support revenues. The second component (“Category I.B Expenses”) shall be in proportion to the sum of the association End User Common Line revenues and the association Special Access Surcharge revenues. Interstate Common Line Support Revenues and Connect America Fund Broadband Loop Support revenues shall be included in the allocation base for Category I.B expenses. The third component (“Category I.C Expenses”) shall be in proportion to the revenues from all other association interstate access charges.
(h) * * *
(4) No distribution to an exchange carrier of High Cost Loop Support revenues shall include adjustments for association expenses other than Category I.A. Expenses.
(5) No distribution to an exchange carrier of revenues from association End User Common Line charges shall include adjustments for association expenses other than Category I.B Expenses. Interstate Common Line Support and Connect America Fund Broadband Loop Support shall be subject to this provision.
(6) No distribution to an exchange carrier of revenues from association interstate access charges other than End User Common Line charges and Special Access Surcharges shall include adjustments for association expenses other than Category I.C Expenses.
Food and Nutrition Service, USDA.
Final rule.
This final rule updates the meal pattern requirements for the Child and Adult Care Food Program to better align them with the Dietary Guidelines for Americans, as required by the Healthy, Hunger-Free Kids Act of 2010. This rule requires centers and day care homes participating in the Child and Adult Care Food Program to serve more whole grains and a greater variety of vegetables and fruit, and reduces the amount of added sugars and solid fats in meals. In addition, this final rule supports mothers who breastfeed and improves consistency with the Special Supplemental Nutrition Program for Women, Infants, and Children and with other Child Nutrition Programs. Several of the changes are extended to the National School Lunch Program, School Breakfast Program, and Special Milk Program. These changes are based on the Dietary Guidelines for Americans, science-based recommendations made by the National Academy of Medicine (formerly the Institute of Medicine of the National Academies), cost and practical considerations, and stakeholder's input. This is the first major revision of the Child and Adult Care Food Program meal patterns since the Program's inception in 1968. These improvements to the meals served in the Child and Adult Care Food Program are expected to safeguard the health of young children by ensuring healthy eating habits are developed early, and improve the wellness of adult participants.
Angela Kline or Laura Carroll, Policy and Program Development Division, Child Nutrition Programs, Food and Nutrition Service, U.S. Department of Agriculture, 3101 Park Center Drive, Room 1206, Alexandria, Virginia 22302-1594; 703-305-2590.
The Healthy, Hungry-Free Kids Act of 2010 (HHFKA), Public Law 111-96, amended section 17 of the Richard B. Russell National School Lunch Act (NSLA), 42 U.S.C. 1766, to require the U.S. Department of Agriculture (USDA), through the Child and Adult Care Food Program (CACFP), to promote health and wellness in child care settings via guidance and technical assistance that focuses on nutrition, physical activity, and limiting electronic media use. Specifically, it required USDA's Food and Nutrition Service (FNS) to review the CACFP meal patterns and make them more consistent with: (a) The most recent version of the Dietary Guidelines for Americans (Dietary Guidelines), (b) the most recent and relevant nutrition science, and (c) appropriate authoritative scientific agency and organization recommendations. Revisions to the CACFP meal patterns are to occur no less frequently than every 10 years. As the Dietary Guidelines and nutrition science evolve, FNS will continue to provide guidance to support CACFP's nutrition and wellness goals.
FNS commissioned the National Academy of Medicine (NAM), formerly the Institute of Medicine of National Academies, to review the CACFP meal patterns and provide recommendations that would improve the nutritional quality of the meals and align them with the most recent version of the Dietary Guidelines. When making recommendations pertaining to infants, the NAM considered recommendations from the American Academy of Pediatrics (AAP), the leading authority for children's developmental and nutritional needs from birth through 23 months, because the Dietary Guidelines does not currently provide recommendations for children under the age of two. In November 2010, the NAM issued the report “Child and Adult Care Food Program: Aligning Dietary Guidance for All” (
On January 15, 2015, FNS published a proposed rule in the
FNS provided an extensive public comment period, from January 15, 2015 through May 27, 2015, to obtain public comments on the impact and effectiveness of the proposed changes to the CACFP meal patterns. FNS received 7,755 public comments on the proposed rule. Of those, 6,508 comments were copies of form letters related to 32 different mass mail campaigns. The remaining comments included 1,231 unique submissions and 16 duplicate submissions. The comments were analyzed using computer software that facilitated the identification of the key issues addressed by the commenters.
Although FNS considered all timely comments, this preamble focuses on the most frequent comments and those that influenced revisions to the proposed rule. To view all public comments on the proposed rule go to
Along with consideration of the comments, the development of the meal pattern requirements in this final rule was informed by the 2010 Dietary Guidelines. The recent publication of the 2015-2020 Dietary Guidelines necessitated a review of these
FNS received comments representing diverse national, State, and local stakeholders, including advocacy organizations; health care associations; food industry representatives; trade associations; CACFP sponsoring organizations and their associations; CACFP providers (throughout this preamble, the term “providers” refers to centers and day care homes that operate the Program); State administering agencies; local government agencies; dietitians and nutritionists; parents and guardians; and many other interested groups and individuals. Overall, commenters were generally more supportive of the proposed rule than opposed.
Comments from advocacy organizations, health care associations, State agencies, and sponsor associations generally favored the proposed rule. These commenters recognized the need to update the CACFP meal patterns to address the nutrition gaps in children's diets, including a lack of vegetables and fruits, and issues of hunger and obesity. Many commenters supported the rule's support of breastfeeding, emphasis on vegetables and fruit, increase in whole grains, and decrease in added sugars. Additionally, many of these commenters suggested ways to strengthen the proposed rule, citing CACFP's role in promoting healthy eating and providing nutritious meals and snacks to children.
While many sponsoring organizations and their associations and providers generally agreed with the proposed changes to the meal patterns, these commenters expressed strong concerns regarding cost, increased recordkeeping burden, and the period of time afforded for implementation. Program operators emphasized that implementation of the final rule will require lead time, phased-in changes, advanced training from FNS, and grace periods.
Comments from food industry representatives and trade associations also supported improving meals served in CACFP, but voiced concerns that some aspects of the proposed rule would limit food choices, increase costs, and prohibit serving nutritious foods that may be more palatable to children. The proposed provisions related to the prohibition on frying, sugar limits on flavored milk and yogurt, and best practices regarding processed meats and juice prompted most of these concerns.
FNS took into consideration the different views expressed by commenters, especially those responsible for the oversight and day to day operation of CACFP, and seeks to be responsive to the concerns they raised. At the same time, and as discussed below, FNS is mindful that the 2008 Feeding Infants and Toddlers Study (FITS),
FNS recognizes that there may be times when a provider would like to serve foods or beverages that are not reimbursable, such as on a child's birthday or another special occasion. Providers still have the flexibility to serve non-reimbursable foods and beverages of their choosing. However, FNS encourages providers to use their discretion when serving non-reimbursable foods and beverages, which may be higher in added sugar, solid fats, and sodium, to ensure children and adult participants' nutritional needs are met.
The tables below outline the requirements established by this final rule, as compared to the proposed requirements. A complete comparison of the proposed rule and the final rule can be found in the supporting documents of the rule docket, FNS-2011-0029, at
Along with updating the meal pattern requirements, the proposed rule addressed optional best practices. While the best practices are not mandatory, they are guidelines to further assist centers and day care homes wishing to take the initiative to improve the nutritional value of meals even more than required by this final rule. In the proposed rule FNS would have added the best practices to the regulatory text. However, in response to comments, FNS will address the best practices via policy guidance instead. Below is a table that summarizes the proposed rule's and the final rule's recommended best practices. The recommended best practices outlined in this final rule will be concretized in policy guidance. As nutrition science evolves, FNS will revisit the best practice guidance.
The following is a summary of the key public comments on the proposed rule and FNS's response. Additional comments that are unrelated to the specific provisions of the rule (
However, some commenters provided alternative infant age groups. A State and a local government agency, an advocacy organization, dietitians and nutritionists, sponsoring organizations, and providers expressed a preference for the current age groups. These commenters expressed concern that the proposed age groups do not allow for solid foods to be gradually introduced to infants when they are developmentally ready, which may be before or after 6 months of age. Because the proposed minimum serving sizes for 6 through11 month olds required some amount of solid foods to be served, advocacy organizations, a health care association, State agencies, and sponsoring organizations recommended allowing for the gradual introduction of solid foods by revising the minimum required serving size ranges of the solid food components in the infant meal patterns be revised to start at zero tablespoons or ounces (
While some commenters supported the introduction of solid foods at 6 months stating that it will encourage and support breastfeeding, most commenters addressing the issue, including providers, dietitians and nutritionists, sponsoring organizations, State agencies, advocacy organizations, health care organizations, and individuals, stated that the proposal was inconsistent with AAP's recommendation to introduce solid foods at approximately 6 months of age, not exactly at 6 months of age. These commenters asserted that requiring solid foods be introduced at 6 months of age may be burdensome and onerous for providers and, therefore, urged FNS to provide flexibility to account for the unique development of each individual infant.
While it was not proposed, many commenters that discussed the introduction of solid foods recommended that providers not be required to obtain a medical statement if a parent chooses to introduce solid food to their infant prior to 6 months of age. Rather, commenters felt that solid foods should be introduced based on the request of the parent or guardian, or based on recommendations from the infant's pediatrician. Commenters suggested that parents or guardians currently tell providers when the introduction of solid foods has begun.
FNS recognizes commenters' concerns regarding the individual dietary needs and developmental readiness for solid foods of each infant and that the AAP recommends introducing solid foods around 6 months of age, not directly at 6 months of age. Therefore, this final rule allows for the introduction of solid foods before or after 6 months of age if it is determined developmentally appropriate for the infant. FNS recommends as best practices that CACFP providers be in constant communication with infants' parents or guardians about when and what solid foods should be introduced, and that
Along with providing flexibility in the timing of introducing solid foods, FNS understands that solid foods need to be introduced gradually to follow infants' oral motor skills development and acceptance of new tastes and textures. Consequently, the serving size ranges for the required solid food components for infants 6 through 11 months of age in this final rule start at zero (
Many other commenters requested FNS provide some flexibility around serving vegetables and fruits at infant snack to promote increased exposure to and consumption of vegetables and fruits without encouraging over-feeding by requiring multiple components. A State agency, sponsoring organizations, and providers suggested vegetables and fruit be gradually introduced to infants as they become developmentally ready. Other commenters, including advocacy organizations, recommended requiring either a vegetable or a fruit,
The majority of commenters, including advocacy organizations, a professional association, nutritionists, State agencies, a pediatric health care provider, sponsoring organizations, and providers, expressed support to disallow the service of fruit juice to infants. Commenters explained that this elimination would improve infant nutrition, decrease the risk of dental caries and malnutrition, and is consistent with the NAM's recommendation to increase access to whole vegetables and fruits.
Those opposing the elimination of fruit juice from the infant meal pattern included trade associations, a member of the food industry, and some providers. These commenters described that AAP's current guideline allows 100 percent juice for infants that are able to hold a cup (approximately 6 months old or older). Along those lines, a trade association asserted that no research or current expert guidance supports the elimination of juice from the diets of infants 6 months old and older, and that 100 percent fruit juice provides valuable and beneficial nutrients.
Similarly, this final rule maintains the proposal to eliminate fruit juice from the infant meal pattern. This is consistent with the NAM's recommendation and with the American Heart Association's Healthy Way to Grow Program's recommendation of no
A larger portion of commenters, including State agencies, advocacy organizations, health care associations, a professional association, sponsoring organizations and their associations, and providers, voiced opposition to restricting cow's milk products for older infants. Several commenters highlighted that the AAP's recommendation to restrict cow's milk until one year of age does not discuss cow's milk products, such as cheese. A health care association affirmed that infants should eat foods from all food groups by 7 or 8 months of age and saw no reason to not allow small quantities of non-liquid milk-based foods, such as cheese and cottage cheese, for older infants. A State agency cited guidance from WIC and sample menus from the AAP that support introducing low-lactose foods, such as yogurt, to infants that are developmentally ready for those foods. An advocacy organization and sponsoring organizations and their associations suggested cheese, cottage cheese, and yogurt be allowed, and cheese foods and cheese spreads be prohibited because they are highly processed and high in sodium.
This final rule also allows whole eggs to credit towards the meat alternate component of the infant meal pattern. Previously, only egg yolks were allowed due to concerns with developing food allergies when infants are exposed to the protein in the egg white. However, AAP recently concluded that there is no convincing evidence to delay the introduction of foods that are considered to be major food allergens, including eggs. Therefore, this final rule allows whole eggs as a meat alternate for infants 6 through 11 months of age. Allowing the whole egg is consistent with the NSLP and SBP. Accordingly, this final rule implements the allowance of cheese, cottage cheese, yogurt, and whole eggs as meat alternates in the infant meal pattern and codifies it under 7 CFR 226.20(b)(4)(ii)(A) and (b)(5).
In opposition to the proposed meal patterns for this age group (400 comments; 340 form letters), State agencies, a union, advocacy groups,
FNS recognizes that the 13 through 18 year old age group may cause some confusion. To help clarify, the meal pattern charts clearly indicate that the 13 through 18 year old age group applies to at-risk afterschool programs and emergency shelters participating in CACFP. For example, a child care provider may not claim reimbursement for meals served to his or her own children that are over the age of 12. FNS understands that the addition of the 13 through 18 year old age group may create some administrative burdens. However, FNS expects these to be small and temporary because there are no Federal administrative requirements to keep records of which age groups are served meals.
Meal reimbursements are based on the type of meal served (breakfast, lunch, supper, or snack) and not on the age groups served.
As proposed, this final rule does not require larger serving sizes to be served to 13 through 18 year olds because meal reimbursements remain unchanged. FNS appreciates the importance of serving meals that meet the nutritional needs of all children participating in CACFP. Therefore, through guidance, FNS will make recommendations for serving meals to children 13 through 18 years of age that build on the meal pattern requirements to ensure that this age group's nutritional needs are met. Accordingly, this final rule implements the proposed rule age groups and codifies them under 7 CFR 226.20(c).
Some sponsor associations, State agencies, a professional association, a trade association, an advocacy organization, and individuals (2,320 comments; 2,040 form letters) generally opposed separating the fruit and vegetable component. These commenters felt that it will increase consumption of less-nutritious foods, decrease the consumption of vegetables, would undo existing menus and recipes, and will increase burden in terms of increased costs, plate waste, tracking, and decreased flexibility. Some commenters expressed concern that it will be difficult to determine which foods are considered vegetables and fruits, such as avocados and tomatoes, and asked FNS to provide technical assistance and to take into consideration cultural foods.
Many commenters (540 comments; 370 form letters), including those that supported and opposed a separate vegetable and fruit component, urged FNS to allow two vegetables to be served at lunch and supper meals instead of a vegetable and a fruit. These commenters expressed that such an allowance would give providers greater flexibility in menu planning as two vegetables may be more appealing for some meals, further encourage the consumption of vegetables, reduce the amount of fruit juice offered, and recognize the seasonality of local produce. In addition, health care associations, advocacy organizations, and a sponsor association believed that this allowance would bring vegetable consumption closer to the amount recommended by the Dietary Guidelines, as many children do not currently consume enough vegetables.
FNS acknowledges that what is considered a vegetable or fruit may be slightly confusing, especially as various cultures may identify vegetables and fruits differently. To ensure CACFP operators understand and are able to comply with the new separate vegetable and fruit components, FNS will work closely with State agencies and provide additional guidance, including how to credit traditional foods. FNS wants to emphasize that while “The Food Buying Guide for Child Nutrition Programs” (
In response to commenters' request, this final rule permits the option to serve two vegetables at lunch and supper, instead of one vegetable and one fruit. The NAM report and the 2015-2020 Dietary Guidelines found that very few children (1 through 8 years old) consume the recommended amount of vegetables, while the majority of
To be consistent with the Dietary Guidelines' recommendation that all Americans should consume a variety of vegetables, this final rule requires that two different kinds of vegetables be served when a provider chooses to serve two vegetables at lunch and supper. For example, a reimbursable lunch may consist of milk, a chicken sandwich, broccoli, and carrots. However, a lunch menu with milk, a chicken sandwich, and two servings of broccoli would not be reimbursable. Please note, the vegetables do not need to be from different vegetable subgroups (
However, more commenters (120 comments) opposed allowing fruit juice or vegetable juice to comprise the entire meal component. Health care associations, advocacy organizations, State agencies, and numerous individuals expressed great concern that the proposed rule would allow juice to be served multiple times per day. These commenters stated that juice is not equal to whole fruit because it has less fiber, more sugar and calories, is less satiating than calories consumed from solid foods, which can lead to weight gain, and that children do not consume the recommended amounts or variety of vegetables and fruits.
The overwhelming majority of comments (3,460 comments; 3,350 form letters) from a range of stakeholders, including health care associations, advocacy organizations, State agencies, sponsoring organizations and their associations, and providers, strongly urged FNS to limit the amount of juice served to children listing the health concerns above. These commenters suggested limiting juice to no more than one age-appropriate serving (
Moreover, FNS notes that CACFP providers, on average, already serve juice once per day or less. Additionally, several States, including California, Texas, North Carolina, and Colorado, currently limit the service of juice via licensing requirements and experience high compliance rates. While FNS is aware that whole vegetables and fruits generally cost more than juice, FNS expects this limitation to be feasible and to not raise costs given these realities.
FNS wishes to clarify that 100 percent fruit and vegetable juice blends are creditable in CACFP. Similar to the NSLP and SBP, a 100 percent fruit and vegetable juice blend may contribute to the fruit requirement when fruit juice or puree is the most prominent ingredient; and a 100 percent fruit and vegetable juice blend may contribute to the vegetable requirement when vegetable juice or puree is the most prominent ingredient. Accordingly, this final rule implements the proposed vegetable juice and fruit juice requirements, with modifications, and codifies them under 7 CFR 226.20(a)(2) and (3), respectively.
Those in opposition (50 comments), mostly individuals and providers, voiced concern regarding the ability to find whole grain products and the cost of whole grains compared to other enriched breads. These commenters
In addition, several commenters requested clarification on when the whole grain-rich requirement would be required. For example, commenters wondered if programs, such as at-risk afterschool programs, that only serve snack and no other meals over the course of the entire day, would be required to serve a whole grain-rich item even though a grain item is not required at snack. Additionally, State agencies, sponsoring organizations, and providers asked for clarification on how the whole grain-rich requirement would be monitored and what would happen if a whole grain-rich food is not served on a given day. Concerned that the procurement of whole grain products may be confusing or difficult for some providers, several commenters suggested FNS offer technical assistance and a transitional implementation period for training and resource development.
Foods that qualify as whole grain-rich are foods that contain a blend of whole-grain meal and/or whole grain flour and enriched meal and/or enriched flour of which at least 50 percent is whole grain and the remaining grains in the food, if any, are enriched; or foods that contain 100 percent whole grain. To maintain consistency across CNPs, this final rule adopts the criterion used in the NSLP and SBP to determine the whole grain content of grain products outlined in FNS memorandum SP 30-2012 (“Grain Requirements for the National School Lunch Program and School Breakfast Program,”
Formative research conducted by FNS (
FNS wants to clarify that a whole grain-rich item is only required when grain items are served. If a center or day care home only serves breakfast, the grain item served at breakfast must be whole grain-rich. If an at-risk afterschool program serves only snacks, they are not required to serve any grain item because grains is not a required component of a snack. However, if an at-risk afterschool program that only serves snack chooses to serve a grain item at snack, such as crackers with apples, the grain item must be whole grain-rich. FNS also wishes to clarify that the requirement applies to the center or day care home, not to each child or adult participant. For example, if a center or day care home serves breakfast and lunch and two different groups of children or adults are at each meal, only one meal must contain a whole grain-rich food.
In the situation when a center or day care home serves grain items but none of the grains served on that given day are whole grain-rich, then the meal with the lowest reimbursement rate where a grain item was served would be disallowed. For example, if a center or day care home serves breakfast and snack and a grain item is served at both breakfast and snack, but neither of the grain items are whole grain-rich, then the snack would be disallowed because it has the lowest-reimbursement rate and it contained a grain item. Conversely, if a grain is not served at snack and the grain item served at breakfast is not whole grain-rich, then the breakfast meal would be disallowed. This is because it is the breakfast meal is the meal with the lowest reimbursement rate that contained a grain item.
Accordingly, this final rule implements the proposed rule's whole grain-rich requirement without change and codifies it under 7 CFR 226.20(a)(4)(i).
The proposed prohibition on grain-based desserts was primarily opposed by some sponsoring organizations, providers, and State agencies (160 comments). Providers suggested that grain-based desserts be limited (
In many of the comments about grain-based desserts, commenters asked for clarification on what would count as a grain-based dessert and many other commenters offered a definition for grain-based desserts. Numerous commenters, including sponsoring organizations and their associations, State agencies, and advocacy organizations, recommended defining grain-based desserts using Exhibit A in USDA's “Food Buying Guide for Child Nutrition Programs,” which denotes desserts with superscripts 3 and 4. Other advocacy organizations, a few State agencies, and a pediatric health care provider suggested the term grain-based desserts should include grain-based foods with added sugars or fats, such as cakes, cookies, pies, sweet rolls, donuts, brownies, candy, fruit pies, turnovers, and cereals with more than 6 grams of sugar per serving. FNS was cautioned by a health care association and advocacy organization not to use the NSLP and SBP's definition of grain-based desserts because it is difficult to interpret and apply.
Commenters requested a definition of grain-based desserts and in this final rule FNS adopts a definition provided by several commenters: Grain-based desserts are those items in USDA's “Food Buying Guide for Child Nutrition Programs” Exhibit A, which are denoted as desserts with superscripts 3 and 4. This definition of grain-based desserts includes cakes, cookies, sweet pie crusts, fruit turnovers, doughnuts, granola bars, toaster pastries, sweet rolls, and brownies. CACFP operators are familiar with Exhibit A and this definition is consistent with the NSLP's and SBP's definition of grain-based desserts. As a reminder, providers may choose to serve grain-based desserts, such as for celebrations or other special occasions, as an additional food item that is not reimbursable.
Accordingly, this final rule does not allow grain-based desserts to count towards the grain requirement and codifies the prohibition under 7 CFR 226.20(a)(4)(iii).
Those in opposition (960 comments; 830 form letters), including advocacy organizations, a professional association, sponsor associations, and a local government agency, felt that the adoption of all the WIC breakfast cereal nutrient requirements would be very complicated for providers to implement. These commenters explained that all eligible cereals are not on WIC-approved State agency lists, lists vary among States, and that it would be extremely difficult to determine which cereals meet all the requirements when only using the Nutrition Facts Label. However, the majority of commenters in opposition to conformance with the full WIC breakfast cereal nutrient requirements supported some sort of sugar limit on breakfast cereals. Many commenters recommended FNS adopt WIC's sugar limit only (no more than 6 grams of sugar per dry ounce).
Accordingly, this final rule requires breakfast cereals to contain no more than 6 grams of sugar per dry ounce and codifies the requirement under 7 CFR 226.20(a)(4)(ii).
Similarly, an advocacy organization, a State agency employee, and an individual suggested the CACFP adopt the ounce equivalency requirements in the NSLP and SBP. Along with being consistent with other CNPs, commenters noted that by using ounce equivalents to determine the quantity of creditable grains FNS can ensure that the CACFP grains component requirement reflects current nutrition science.
However, the majority of commenters (2,170 comments; 2,090 form letters) opposed allowing one-half of the breakfast grains requirement to be substituted with a meat or meat alternate. Many commenters, including sponsoring organizations, a State agency, providers, and individuals, believed the provision would be too complicated to implement and monitor, and would increase costs. Specifically, these commenters expressed concerns about the practicality of serving very small quantities of meat or meat alternates for children 1 through 5 years of age, because those age groups' grains component serving sizes are already very small.
Several commenters offered modifications to the provision. Sponsoring organizations and their associations suggested maintaining the current option to allow meat or meat alternates as additional foods at breakfast. Other suggested modifications included allowing a meat or meat alternate to replace the entire grains requirement at breakfast or requiring a meat or meat alternate at breakfast.
While commenters welcomed tofu as a meat alternate, a variety of commenters (250 comments; 230 form letters) expressed concern regarding how tofu would be credited. Multiple sponsoring organizations and their associations, advocacy organizations, a health care association, and a trade association strongly advocated that guidance should allow tofu to be used in culturally appropriate ways, such as in soups and stews.
Accordingly, this final rule implements the proposal to allow tofu and other soy products to be used to meet all or part of the meat and meat alternates component, and codifies it under 7 CFR 226.2, 226.20(a)(5)(iv).
Along with supporting a required sugar limit on yogurt, many commenters recommended that FNS lower the sugar limit to either 20 grams or 23 grams of sugar per 6 ounces. These commenters, including multiple health care associations and advocacy organizations, and a State agency, emphasized the importance of reducing added sugars in yogurt served in CACFP and expressed concern that the proposed sugar limit may be too liberal as very few products on the market (including those with candy and cookies) would be disallowed by this standard. Food industry members and trade associations asserted that yogurt companies are continuing to develop low-sugar yogurts.
FNS believes this lower sugar limit is attainable and maintains product palatability while reducing the intake of added sugar. FNS conducted extensive market research on the availability of yogurts below the sugar limit
This sugar limit is lower than the NAM's recommendation and WIC's yogurt sugar limit, but it is consistent the Dietary Guidelines and the NAM's overarching goal of lowering the amount of added sugars in meals served in CACFP. In addition, this lower sugar limit is consistent with the current market trend highlighted by commenters of the greater availability of lower-sugar yogurts. For instance, Dannon, a yogurt producer whose products are available nationwide, pledged to reduce the amount of total sugar in all of their yogurt products for children to 23 grams of sugar or less per 6 ounces by 2016.
FNS is mindful of commenters' concerns regarding a yogurt sugar limit. FNS is committed to helping CACFP operators comply with all the new meal pattern requirements and will provide technical assistance and guidance to ensure CACFP operators understand the sugar limit on yogurt for successful implementation.
Accordingly, this final rule implements the proposed rule's alternative C1, with modifications, and codifies it under 7 CFR 226.20(a)(5)(iii).
More commenters (460 commenters; 290 form letters) opposed requiring unflavored whole milk be served to children 1 year old. State agencies, sponsors, and providers voiced concern that the provision would be restrictive and intrusive, that some children will not drink whole milk, and that the provider or parent should be able to decide whether the child is served whole or reduced-fat milk. Some sponsoring organizations and their associations and providers stated that the provision would require most providers to purchase and buy more than one kind of milk. Additionally, a professional association and a health care association stated that the AAP recommends that low-fat milk may be considered for 1 year old children if growth and weight gain are appropriate, or especially if weight gain is excessive or family history is positive for obesity, dyslipidemia, or cardiovascular disease. Several commenters brought up the challenge of switching children from whole milk to low-fat or fat-free milk when children turn 2 years old, and requested a transition period as a solution.
Children 2 years old and older:
• Children 2 through 4 years old: Alternative A1, flavored milk would be prohibited; or, Alternative A2, require flavored milk to contain no more than 22 grams of sugar per 8 fluid ounces.
• Children 5 years old and older and adults: Alternative B1, require flavored milk to contain no more than 22 grams of sugar per 8 fluid ounces; or, Alternative B2, recommend as a best practice that flavored milk contain no more than 22 grams of sugar per 8 fluid ounces.
In regards to a sugar limit, more commenters (4,400 comments; 4,190 form letters) favored prohibiting flavored milk (A1) over requiring flavored milk to meet a sugar limit for children 2 through 4 years old (A2). State agencies, a Federal agency, a pediatric health care provider, advocacy groups, sponsoring organizations, dietitians and nutritionists, and providers supported A1 because flavored milk has no nutritional benefit over unflavored milk, contributes to increased sugar consumption, obesity, and tooth decay, and is not appropriate for this age group when taste preferences are being formed. Some of these commenters recommended FNS modify the age group to 2 through 5 year olds as some 5 year olds are still in child care. A State agency and a health care association asserted that flavored milk is rarely served, which would suggest that compliance with A1 would have minimal burden on providers.
Those in support (55 comments) of setting a sugar limit on flavored milk for children 2 through 4 years old (A2), including professional associations, advocacy groups, State agencies, sponsoring organizations, dietitians and nutritionists, and providers, did not want to prohibit flavored milk and expressed concern that requiring unflavored milk would promote food waste as some children will not drink unflavored milk. These commenters argued that it is better for children to drink chocolate milk, rather than no milk at all. Similarly, two professional associations asserted that flavored milk is an effective tool in encouraging milk consumption for school-age children.
For children 5 years old and older, and adults, many more commenters favored requiring a sugar limit on flavored milk (B1) than establishing a best practice (B2). Those in support of alternative B1 (3,440 comments; 3,330 form letters), including State agencies, a Federal agency, advocacy groups, sponsoring organizations, dietitians and nutritionists, and providers, cited concerns around flavored milk contributing to increased sugar intake and felt that the requirement would not be burdensome. Those in support of alternative B2 (290 comments; 240 form letters) favored a best practice because it would reduce the monitoring and compliance burden while a requirement would increase complexity of the Program. A dairy association added that it may be difficult to find flavored milks within the sugar limit in retailer stores. In addition, commenters stated that allowing flavored milk with no required
Some commenters expressed concern that prohibiting flavored milk for younger children would be burdensome. However, FNS expects this requirement to be minimally burdensome because commenters asserted that flavored milk is rarely served in CACFP and multiple States currently prohibit flavored milk in child care via licensing requirements. FNS agrees that it would be more challenging to monitor and implement a sugar limit on flavored milk, especially because milk is a required meal component at breakfast, lunch, and supper, and some providers make flavored milk with syrup so the sugar content could vary from batch to batch. Additionally, market research indicates that in the retailer setting there is, in general, a limited selection of fat-free flavored milks within the proposed sugar limit. While the amount of sugar in flavored milk has decreased over the past few years, only about half of fat-free flavored milks available in the retail setting contain no more than 22 grams of sugar per 8 fluid ounces. While providers may serve only unflavored milk, complying with a sugar limit on flavored milk when choosing to serve flavored milk may be particularly difficult or infeasible for providers living in rural areas with limited options.
In recognition of these challenges, this final rule establishes a best practice on the sugar content of flavored milk for children 6 years old and older, and adults (B2). Allowing flavored milk without a sugar limit for school-age children is consistent with the NSLP and SBP and may aid in this age group's consumption of milk. Some research shows that flavored milk consumption among children is associated with improved diet quality and increased nutrient intakes, such as calcium, folate, and iron. Further, these studies found that flavored milk consumption is not associated with weight gain or higher total daily sugar intake in children. However, these studies do not clearly look at the different impacts between children that drank flavored milk and children that drank unflavored milk and, in general, show that children that drank any type of milk had significantly higher consumption of key nutrients compared to children that drank no milk. Overall, further research is needed to examine the impact of flavored milk on energy and added sugar consumption.
Due to this limited research and with the new Dietary Guidelines' added sugar recommendation, as well as knowing that added sugar consumption, as a percent of calories, is particularly high for children, FNS is aware there is more work to be done. FNS will continue to assess the flavored milk sugar limit best practice and will actively engage in conversations with stakeholders to learn more about how often flavored milk is served in CACFP and the feasibility of increasing the market availability of lower-sugar flavored milk. In addition, FNS is about to launch a study to assess the quality of meals served to children in child care that will provide insightful data on the trends of flavored milk service in the CACFP. FNS will revise the best practice based on this information and as nutrition science evolves and the market availability of lower-sugar flavored milks improves. Depending on the revision of the Nutrition Facts Label, FNS may be able to directly address added sugars in the future if the new Nutrition Facts Label clearly delineates added sugars from natural sugars. Further, FNS will provide ample technical assistance to support and encourage CACFP providers that serve flavored milk to adopt the sugar limit best practice.
As visible above, this final rule adjusts the age groups for the flavored milk requirements based on commenters' suggestion and to better align with the meal pattern age groups (1 through 2 year olds; 3 through 5 year olds; 6 through 12 year olds; adults). Finally, to maintain consistency with the NSLP and SBP, this final rule establishes that if flavored milk is served, it must be fat-free. Accordingly, this final rule implements the proposed rule's requirement that flavored milk be fat-free and alternatives A1 and B2, with modifications, and codifies them under 7 CFR 226.20(a)(1).
Those opposing (140 comments) the proposal to prohibit frying on-site offered a variety of reasons for not completely disallowing frying foods on-site. An advocacy organization, some providers, a sponsoring organization, and a trade association expressed concern that the prohibition would limit providers' food choices when menu planning and may lead providers to serve more processed foods. A professional association, a State agency, and individuals stated that there are cultural reasons for allowing certain foods to be fried, such as fish and holiday treats. In place of a complete prohibition, various commenters offered alternative ways to limit frying, either through a requirement or a best practice.
Many commenters, including health care associations, advocacy organizations, State agencies, and a pediatric health care provider, opposed allowing foods prepared off-site to be fried. These commenters reasoned that purchasing fried foods negates the nutritional rationale for the ban on frying on-site. Many of these commenters urged FNS to extend the prohibition to all pre-fried foods and foods fried off-site, including fried foods prepared by vendors, caterers, and carry-out facilities. However, some
A variety of commenters (2,580 comments; and 2,240 form letters) discussed the definition of frying, including sponsoring organizations and their associations, providers, health care associations, State and local agencies, advocacy organizations, professional associations, and a trade association. Many of these commenters urged FNS to provide a clear definition and clarify whether frying is deep-fat frying or if it includes sautéing, pan-frying, and stir-frying. Some commenters offered specific definitions of frying. Advocacy organizations, sponsoring organizations and their associations suggested frying be defined as deep-fat frying,
By defining frying as deep-fat frying, providers have great flexibility in how they choose to prepare meals and are not prevented from preparing culturally appropriate foods. For example, fish may be allowable in a reimbursable meal if it is pan-fried or prepared another way, as long as it is not cooked by submerging the bread into hot oil or other fat.
While many commenters urged FNS to expand the prohibition to all purchased foods that are pre-fried, FNS believes that expanding the prohibition at this point in time would be too restrictive because it would greatly limit providers' flexibility and menu choices. This would likely lead to increased costs for providers, particularly in areas where affordable alternatives are not yet available. In addition, this final rule focuses on incremental changes as CACFP operates in diverse settings with varying skills, resources, and facilities devoted to food preparation. FNS recognizes that store-bought, catered, or pre-fried foods can still contribute large amounts of calories and saturated fat to a meal and that there is more work to be done on this issue. Therefore, this final rule maintains the proposed rule's best practice encouraging providers to limit all purchased pre-fried foods to once per week (see
Some of those in opposition, including a professional association, a State agency, and several individuals, asserted that parents or guardians should only be permitted to substitute foods when a child has a documented dietary need or disability and when the food or beverage item in question creates a financial or access hardship for the provider. Other commenters expressed concern regarding parents and guardians ability to follow food safety standards, that it will impose a burden on child care facilities, and that it will be confusing and difficult to monitor.
Some commenters addressed allowing parents or guardians to provide meal components for children with disabilities. FNS Instruction 784-3, “Reimbursement for Meals Provided by Parents in the Child Care Food Program” (October 14, 1982), already allows centers or day care homes to claim reimbursement when parents and guardians supply one or more meal components for children with disabilities as long as the provider supplies at least one required meal component. In response to comments, this final rule codifies the policy guidance outlined in FNS Instruction 784-3 and clarifies that this policy also applies to adult participants. Additionally, this final rule reflects the recently published FNS policy memorandum SP 32-2015, SFSP 15-2015, CACFP 13-2015 (“Statements Supporting Accommodations for Children with Disabilities in the Child Nutrition Programs,”
A professional association, a couple of health care associations and advocacy organizations, a pediatric health care provider, a few sponsoring organizations and their associations, and a State agency asked for clarification on the distinction between family style meal service and offer versus serve (OVS). Some of these commenters suggested FNS provide a definition of family style meal service.
In order to help clarify the difference between family style meal service and OVS, this final rule defines family style as a type of meal service which allows participants to serve themselves from common platters of food with the assistance of supervising adults, if needed. In OVS, all the required meal components must be offered to each child or adult participant, and each child or adult participant may decline to take one or two of the meal components, depending on the meal being served. The key difference between the two is that food components in family style meals are self-served while food components in OVS are pre-portioned or served directly by a provider. FNS will work closely with State agencies and provide additional technical assistance and guidance on family style meal service and OVS as needed. Accordingly, this final rule implements the proposed rule's family style meal service practices and codifies them under 7 CFR 226.20(n).
• Support mothers who choose to breastfeed their infants by encouraging mothers to supply breastmilk for their infants while in day care and providing a quiet, private area for mothers who come to the day care facility to breastfeed.
• Limit the consumption of fruit juice to no more than one serving per day for children one and older.
• Make at least one of the two required components of snack a fruit or vegetable.
• Provide at least one serving each of dark green vegetables, red and orange vegetables, and legumes once per week.
• Provide at least two servings of whole grain-rich grains per day.
• Serve only lean meats, nuts, and legumes.
• Limit the service of processed meats to no more than once per week, across all eating occasions.
• Serve only natural cheeses.
• Serve only unflavored milk to all participants.
• Limit the service of fried and pre-fried foods to no more than one serving per week, across all eating occasions.
A variety of commenters requested that some of the best practices be made requirements, including the best practices regarding fruit juice, processed meats, unflavored milk, and whole grains. Other commenters suggested additions and modifications to the best practices or elimination of some best practices. For example, two advocacy groups suggested that FNS add guidance for providers to not consume sugar-sweetened beverages in front of children.
FNS agrees with commenters that including the best practices in the regulatory text may cause some confusion and lead CACFP operators to think they are required rather than encouraged to comply with them. Therefore, this final rule does not include the best practices in the regulatory text. Instead, FNS will issue guidance to further expand and outline the best practices. Implementing the best practices through policy guidance will also provide FNS greater flexibility to update the best practices as needed, particularly to adapt to evolving nutrition scientific.
FNS made minor modifications to the best practices based on comments and added a few best practices, as appropriate, due to the changes made in this final rule. In particular, FNS added some “Additional Best Practices” that address food preparation (frying), use of seasonal and local foods in CACFP meals, and non-reimbursable foods high in added sugars.
In contrast, new statutory authority enacted in HHFKA, which amended Section 10(b)(1)(B) of the Child Nutrition Act of 1996, 42 U.S.C. 179(b)(1)(B), specifically authorized USDA to regulate foods sold in schools other than foods served as part of the reimbursable meals in the NSLP and SBP. The provision further empowered USDA to regulate the nutritional requirements of foods sold on campus in participating schools at any time of day. Prior to that specific, expansive amendment, USDA was constrained to regulate the nutritional requirements of only those foods sold as part of the reimbursable NSLP and SBP during the meal service and in the meal service area. To provide similar authority to USDA in CACFP, Congressional action would be required.
However, FNS strongly supports reducing the consumption of foods high
FNS highly encourages centers and day care homes to implement the best practices listed below in order to ensure children and adults are getting the optimal benefit from the meals they receive while in care:
• Support mothers who choose to breastfeed their infants by encouraging mothers to supply breastmilk for their infants while in day care and offering a quiet, private area that is comfortable and sanitary for mothers who come to the center or day care home to breastfeed. (Modified)
• Make at least one of the two required components of snack a vegetable or a fruit.
• Serve a variety of fruits and choose whole fruits (fresh, canned, frozen, or dried) more often than juice. (New)
• Provide at least one serving each of dark green vegetables, red and orange vegetables, beans and peas (legumes), starchy vegetables, and other vegetables once per week. (Modified)
• Provide at least two servings of whole grain-rich grains per day.
• Serve only lean meats, nuts, and legumes.
• Limit serving processed meats to no more than one serving per week.
• Serve only natural cheeses and choose low-fat or reduced-fat cheeses. (Modified)
• Serve only unflavored milk to all participants. If flavored milk is served to children 6 years old and older, or adults, use the Nutrition Facts Label to select and serve flavored milk that contains no more than 22 grams of sugar per 8 fluid ounces, or the flavored milk with the lowest amount of sugar if flavored milk within this sugar limit is not available. (Modified)
• Serve water as a beverage when serving yogurt in place of milk for adults. (New)
• Incorporate seasonal and locally produced foods into meals. (New)
• Limit serving purchased pre-fried foods to no more than one serving per week.
• Avoid serving non-creditable foods that are sources of added sugars, such as sweet toppings (
• In adult day care centers, offer and make water available to adults upon their request throughout the day. (New)
FNS would like to emphasize that these best practices are
An advocacy organization and a health care association recommended FNS establish a preschool grade group for children 1 through 4 years old that could be added to the current age-grade groups in the NSLP and SBP to help simplify food service when a preschool has 5 year olds or when a kindergarten has 4 year olds. For flexibility of school vended meals, these same commenters recommended allowing a single menu option if preschool and elementary school students are in the same cafeteria at the same time. In addition, to maintain flexibility for community-based CACFP afterschool programs and child care programs with school vending, these commenters asserted that it will be critical to continue to allow those programs the option to follow the NSLP and SBP meal patterns, which is currently allowed under 7 CFR 226.20(o).
Of the few commenters (15 comments) that addressed the SMP, most of them supported revising the fluid milk requirements and non-diary milk substitutes in the SMP to align with CACFP's proposed fluid milk requirements. A professional association stated that it would only support streamlining SMP with CACFP if low-sugar, flavored milk is an allowable option.
FNS wishes to provide some clarity around some of commenters' concerns. First, the 1 through 4 year old age group is considered the preschool grade group in the NSLP and SBP. In situations where a 5 year old is in a preschool or
Although not raised specifically in the proposed rule, FNS agrees with commenters that institutions, particularly at-risk afterschool programs, which serve meals prepared in schools that participate in the NSLP and SBP should continue to have the flexibility to follow the NSLP or SBP meal patterns, as currently provided under 7 CFR 226.20(o),
This final rule revises the SMP milk requirements to align with all of the CACFP's milk requirements, including requiring unflavored whole milk be served to one year olds; allowing only low-fat or fat-free milk for children ages 2 years old and older; prohibiting flavored milk for children 2 through 5 years old; requiring flavored milk to be fat-free for children 6 years old and older; and allowing non-dairy milk substitutes that are nutritionally equivalent to milk to be served in place of fluid milk for children with medical or special dietary needs. Accordingly, this final rule implements the proposed rule's amendments to the school nutrition programs and codifies them under 7 CFR 210.10(o), (p), and (q), 215.7a, and 220.8(o) and (p). In addition, this final rule makes a technical amendment to renumber and rename, without substantive changes, 7 CFR 226.20(o),
The following meal patterns must be implemented by October 1, 2017, unless otherwise specified in the footnotes.
Compliance with the provisions of this final rule must begin October 1, 2017, except for the adjusted minimum serving sizes for the grains requirement based on ounce equivalents criteria, which must be implemented by October 1, 2019.
Section 221 of the HHFKA requires FNS to provide technical assistance to participating child care centers and day care homes in complying with the new meal pattern requirements. As a first step, FNS coordinated with the U.S. Department of Health and Human Services to develop recommendations, guidelines, and best practices for providers that are consistent with the nutrition, physical activity, and wellness requirements of the HHFKA and this final rule. From this collaboration, the handbook “Nutrition and Wellness Tips for Young Children: Provider Handbook for the Child and Adult Care Food Program” was published in January 2013 (
FNS conducted needs assessment research to identify additional materials and training that would be useful to CACFP operators. The final report was published in March 2015 (
In addition, FNS will work with State agencies to facilitate transition to the new meal pattern requirements. FNS continues to partner with the Institute of Child Nutrition (formerly the National Food Service and Management Institute) to develop and provide appropriate training materials for CACFP.
Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This final rule has been determined to be significant and was reviewed by the Office of Management and Budget (OMB) in conformance with Executive Order 12866.
As required for all rules that have been designated as significant by the Office of Management and Budget, a Regulatory Impact Analysis (RIA) was developed for this final rule. The full RIA is included in the supporting documents of the rule docket at
This rule changes the meal pattern requirements for the Child and Adult Care Food Program (CACFP), pursuant
The baseline for this regulatory impact analysis is the current cost of food to providers in homes and centers that participate in the CACFP. The final rule more closely aligns the meals served in CACFP with the Dietary Guidelines in an essentially cost-neutral manner, as HHFKA did not provide any funding for additional or increased meal reimbursements in CACFP. USDA estimates that the rule will result in a very small decrease in the cost for CACFP providers to prepare and serve meals to Program participants,
Much of the
• The changes to the meal patterns for infants. A change in the age groups and formula quantities mean that slightly less formula will be served under the final meal patterns than under current rules.
• Provisions that increase provider flexibility in serving meals, such as allowing a meat or meat alternate to be served in place of the entire grains requirement at breakfast a maximum of three times per week, allowing tofu as a meat alternate, and allowing yogurt to be used to meet the fluid milk requirement for adults, no more than once per day.
Provisions that are expected to or may slightly increase the cost of serving meals that meet the final requirements include:
• The addition of fruits and vegetables as a component of infant snacks starting at 6 months.
• The requirement that at least one grain serving per day be whole grain-rich. Because whole grain-rich products tend to cost more than their refined grain substitutes, this provision is expected to have a modest upward effect on the cost of providing CACFP meals.
• The separation of fruits and vegetables into separate meal components. Although this is not
• Provisions that limit provider flexibility in serving meals, such as the disallowing of frying as an on-site food preparation method.
By updating Program regulations to make them more consistent with the recommendations of the Dietary Guidelines, the final rule will ensure that meals served at CACFP centers and homes better reflect nutrition science; increase the availability of key food groups; better meet the nutritional needs of infants, children, and adults; and foster healthy eating habits.
The changes are expected to positively impact the nutritional outcomes of all groups of CACFP participants. The infant meal pattern will help to ensure that infants will exclusively breast- or formula-feed throughout their first six months of life, as recommended by the American Academy of Pediatrics (AAP). Separating fruits and vegetables into two components increases the variety of foods that CACFP participants are able to consume at meal times. Disallowing grain-desserts as reimbursable food items, establishing a sugar limit on yogurt, disallowing frying as an on-site food preparation method, and modifying the fluid milk requirements will decrease the amount of added sugars and solid fats consumed by CACFP participants through Program meals. Requiring that one serving of grains be whole grain-rich will increase CACFP participants' consumption of whole grains, which, as the NAM notes in its report, is very low across all CACFP participant age groups.
The rule also increases flexibility for CACFP providers to better meet the nutritional requirements and dietary preferences of participants. It allows a meat or meat alternate to be served in place of the entire grains requirement at breakfast a maximum of three times per week, allows tofu as a meat alternate, and allows yogurt to be used to meet the fluid milk requirement for adults, no more than once per day.
The Regulatory Flexibility Act (5 U.S.C. 601-612) requires agencies to analyze the impact of rulemaking on small entities and consider alternatives that would minimize any significant impacts on a substantial number of small entities. Pursuant to that review, the Administrator of FNS certifies that this rule would not have a significant economic impact on a substantial number of small entities. While this final rule makes several revisions to the CACFP meal patterns, the provisions in this rulemaking are of minimal cost and are achievable without creating a hardship for any small entities that administer and participate in the nutrition assistance programs affected by this rulemaking, including State agencies, local educational agencies, school food authorities, child care institutions, and adult care institutions.
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local and tribal governments and the private sector. Under section 202 of the UMRA, the Department generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures by State, local or tribal governments, in the aggregate, or the private sector, of $146 million or more (when adjusted for 2015 inflation; GDP deflator source: Table 1.1.9 at
This final rule does not contain Federal mandates (under the regulatory provisions of Title II of the UMRA) for State, local and tribal governments or the private sector of $100 million or more in any one year. Thus, the rule is not subject to the requirements of sections 202 and 205 of the UMRA.
The Child and Adult Care Food Program (CACFP), National School Lunch Program (NSLP), School Breakfast Program (SBP), and Special Milk Program (SMP) are listed in the Catalog of Federal Domestic Assistance under CACFP No. 10.558, NSLP No. 10.555, SBP No. 10.553, and SMP No. 10.556, respectively, and are subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. The Child Nutrition Programs are federally funded programs administered at the State level. The Department headquarters and regional offices staff engage in ongoing formal and informal discussions with State and local officials regarding program operational issues. This structure of the Child Nutrition Programs allows State and local agencies to provide feedback that forms the basis of any discretionary decisions made in this and other rules.
Executive Order 13132 requires Federal agencies to consider the impact of their regulatory actions on State and local governments. Where such actions have federalism implications, agencies are directed to provide a statement for inclusion in the preamble to the regulations describing the agency's considerations in terms of the three categories called for under Section (6)(b)(2)(B) of Executive Order 13121.
The Department has considered the impact of this rule on State and local governments and has determined that this rule does not have federalism implications. Therefore, under section 6(b) of the Executive Order, a federalism summary is not required.
This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This final rule is intended to have a preemptive effect with respect to any State or local laws, regulations or policies which conflict with its provisions or which would otherwise impede its full and timely implementation. This rule would permit State or local agencies operating the Child and Adult Care Food Program to establish more rigorous nutrition requirements or additional requirements for child or adult care meals that are not inconsistent with the nutritional provisions of this rule. Such additional requirements would be permissible as part of an effort by a State or local agency to enhance the child and adult day care meals or the child and adult day care nutrition environment. To illustrate, State or local agencies would be permitted to establish more restrictive whole grain requirements. For this requirement, quantities are stated as a minimum and could not be lower; however, greater amounts than the minimum could be offered. While State agencies and local agencies may establish more rigorous nutrition requirements, they cannot establish less rigorous nutrition requirements as the Russell B. National School Lunch Act; 42 U.S.C. 1766(g) provides the U.S. Department of Agriculture the authority
FNS has reviewed this final rule in accordance with USDA Regulation 4300-4, “Civil Rights Impact Analysis,” to identify any major civil rights impacts the rule might have on program participants on the basis of age, race, color, national origin, sex, or disability. Existing regulations at §§ 226.60(h) and 210.10(m)(1) require centers, day care homes and schools to make food substitutions or modifications in the meals or snacks served under the Child and Adult Care Food Program, the National School Lunch Program, or the School Breakfast Program for children and adults who are considered to have a disability that restricts their diets. Centers, day care homes, and schools will continue to be required to offer accommodations to children and adults whose disability restricts their diet. After a careful review of the rule's intent and provisions, FNS has determined that this rule is not expected to affect the participation of protected individuals in the Child and Adult Care Food Program, National School Lunch Program, School Breakfast Program, or Special Milk Program.
This rule has been reviewed in accordance with the requirements of Executive Order 13175, “Consultation and Coordination with Indian Tribal Governments.” Executive Order 13175 requires Federal agencies to consult and coordinate with tribes on a government-to-government basis on policies that have tribal implications, including regulations, legislative comments or proposed legislation, and other policy statements or actions that have substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes or on the distribution of power and responsibilities between the Federal Government and Indian tribes.
The Food and Nutrition Service has assessed the impact of this rule on Indian tribes and determined that this rule does not, to our knowledge, have tribal implications that require tribal consultation under EO 13175. FNS provides regularly scheduled quarterly webinars and conference calls as a venue for collaborative conversations with Tribal officials or their designees. On a February 18, 2015 call, FNS advised Tribal officials that the proposed rule to update the CACFP meal patterns had been published and encouraged participants to submit public comments. No comments or questions from Tribal officials arose related to the proposed rule. If a Tribe requests consultation, the Food and Nutrition Service will work with the USDA Office of Tribal Relations to ensure meaningful collaboration is provided where changes, additions and modifications identified herein are not expressly mandated by Congress.
The Paperwork Reduction Act of 1995 (44 U.S.C. Chap. 35; 5 CFR part 1320) requires the Office of Management and Budget (OMB) approve all collections of information by a Federal agency before they can be implemented. Respondents are not required to respond to any collection of information unless it displays a current valid OMB control number. This rule contains information collections that have been approved by OMB under OMB #0584-0055. Additionally, FNS will issue a separate 60-day notice under OMB #0584-0055 and submit a request for clearance to OMB to include the required written requests for non-dairy milk substitutions. This requirement will become effective until such time that clearance is received from OMB. When OMB notifies FNS of its decision, FNS will publish a notice in the
FNS is committed to complying with the E-Government Act, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.
Children, Commodity School Program, Food assistance programs, Grants programs—social programs, National School Lunch Program, Nutrition, Reporting and recordkeeping requirements, Surplus agricultural commodities.
Food assistance programs, Grant programs—education, Grant programs—health, Infants and children, Milk, Reporting and recordkeeping requirements.
Grant programs—education, Grant programs—health, Infants and children, Nutrition, Reporting and recordkeeping requirements, School breakfast and lunch programs.
Accounting, Aged, American Indians, Day care, Food assistance programs, Grant programs, Grant programs—health, Individuals with disabilities, Infants and children, Intergovernmental relations, Loan programs, Reporting and recordkeeping requirements, Surplus agricultural commodities.
Accordingly, 7 CFR parts 210, 215, 220, and 226 are amended as follows:
42 U.S.C. 1751-1760, 1779.
The additions and revisions read as follows:
(e)
(g) * * * The State agency and school food authority must provide technical assistance and training to assist schools in planning lunches that meet the meal pattern in paragraph (c) of this section; the calorie, saturated fat, sodium, and
(j)
(l) * * *
(1) * * * With State agency approval, schools may serve lunches to children under age 5 over two service periods. Schools may divide quantities and food items offered each time any way they wish.
(o) * * *
(2)
(i) A serving of fluid milk as a beverage, or on cereal, or used in part for each purpose.
(ii) A serving of meat or meat alternate, including nuts and seeds and their butters listed in FNS guidance that are nutritionally comparable to meat or other meat alternates based on available nutritional data.
(A) Nut and seed meals or flours may be used only if they meet the requirements for alternate protein products established in appendix A of this part.
(B) Acorns, chestnuts, and coconuts cannot be used as meat alternates due to their low protein and iron content.
(iii) A serving of vegetable or fruit, or full-strength vegetable or fruit juice, or an equivalent quantity of any combination of these foods. Juice must not be served when fluid milk is served as the only other component.
(iv) A serving of whole-grain or enriched bread; or an equivalent serving of a bread product, such as cornbread, biscuits, rolls, or muffins made with whole-grain or enriched meal or flour; or a serving of cooked whole-grain or enriched pasta or noodle products such as macaroni, or cereal grains such as enriched rice, bulgur, or enriched corn grits; or an equivalent quantity of any combination of these foods.
(3)
(ii)
(4)
(ii)
(p)
(2)
(q)
(2)
42 U.S.C. 1772 and 1779.
Fluid milk and non-dairy fluid milk substitutes served must meet the requirements as outlined in this section.
(a)
(1)
(2)
(3)
(b)
42 U.S.C. 1773, 1779, unless otherwise noted.
The addition and revisions read as follows:
(a) * * * This section contains the meal requirements applicable to school breakfasts for students in grades K through 12, and for children under the age of 5. * * *
(3) * * * Labels or manufacturer specifications for food products and ingredients used to prepare school meals for students in grades K through 12 must indicate zero grams of
(c)
(e)
(g) * * * The State agency and school food authority must provide technical assistance and training to assist schools in planning breakfasts that meet the meal pattern in paragraph (c) of this section, the dietary specifications for calorie, saturated fat, sodium, and
(j)
(o)
(2)
(p)
(2)
Secs. 9, 11, 14, 16, and 17, Richard B. Russell National School Lunch Act, as amended (42 U.S.C. 1758, 1759a, 1762a, 1765 and 1766).
This part announces the regulations under which the Secretary of Agriculture will carry out the Child and Adult Care Food Program. Section 17 of the Richard B. Russell National School Lunch Act, as amended, authorizes assistance to States through grants-in-aid and other means to initiate, maintain, and expand nonprofit food service programs for children and adult participants in non-residential institutions which provide care. The Program is intended to provide aid to child and adult participants and family or group day care homes for provision of nutritious foods that contribute to the wellness, healthy growth, and development of young children, and the health and wellness of older adults and chronically impaired persons.
(m)
(1) Prohibit claiming reimbursement for meals provided by a participant's family, except as authorized by §§ 226.18(e) and 226.20(b)(2), (g)(1)(ii), and (g)(2)(ii); and
(2) Allow the cost of the meals served to adults who perform necessary food service labor under the Program, except in day care homes. The State agency must provide guidance on financial management requirements to each institution and facility.
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(2)
(i) Pasteurized, full-strength vegetable juice may be used to fulfill the entire requirement. Vegetable juice or fruit juice may only be served at one meal, including snack, per day.
(ii) Cooked dry beans or dry peas may be counted as either a vegetable or as a meat alternate, but not as both in the same meal.
(3)
(i) Pasteurized, full-strength fruit juice may be used to fulfill the entire requirement. Fruit juice or vegetable juice may only be served at one meal, including snack, per day.
(ii) A vegetable may be used to meet the entire fruit requirement at lunch and supper. When two vegetables are served at lunch or supper, two different kinds of vegetables must be served.
(4)
(A) At least one serving per day, across all eating occasions of bread, cereals, and grains, must be whole grain-rich. Whole grain-rich foods contain at least 50 percent whole grains and the remaining grains in the food are enriched, and must meet the whole grain-rich criteria specified in FNS guidance.
(B) A serving may contain whole grain-rich or enriched bread, cornbread, biscuits, rolls, muffins, and other bread products; or whole grain-rich, enriched, or fortified cereal grain, cooked pasta or noodle products, or breakfast cereal; or any combination of these foods.
(ii)
(iii)
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(A) Lean meat, poultry, or fish;
(B) Alternate protein products;
(C) Cheese, or an egg;
(D) Cooked dry beans or peas;
(E) Peanut butter; or
(F) Any combination of these foods.
(ii)
(A) Nut and seed meals or flours may be used only if they meet the requirements for alternate protein products established in appendix A of this part.
(B) Acorns, chestnuts, and coconuts cannot be used as meat alternates because of their low protein and iron content.
(iii)
(A) Yogurt may be plain or flavored, unsweetened, or sweetened;
(B) Yogurt must contain no more than 23 grams of total sugars per 6 ounces;
(C) Noncommercial or commercial standardized yogurt products, such as frozen yogurt, drinkable yogurt products, homemade yogurt, yogurt flavored products, yogurt bars, yogurt covered fruits or nuts, or similar products are not creditable; and
(D) For adults, yogurt may only be used as a meat alternate when it is not also being used as a fluid milk substitute in the same meal.
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(b)
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(i) A written statement must support the need for the substitution. The statement must include recommended alternate foods, unless otherwise exempted by FNS, and must be signed by a licensed physician or licensed health care professional who is authorized by State law to write medical prescriptions.
(ii) A parent, guardian, adult participant, or a person on behalf of an adult participant may supply one or more components of the reimbursable meal as long as the institution or facility provides at least one required meal component.
(2)
(i) A written statement must support the need for the substitution. The statement must include recommended alternate foods, unless otherwise exempted by FNS. Except for substitutions of fluid milk, as set forth below, the statement must be signed by a recognized medical authority.
(ii) A parent, guardian, adult participant, or a person on behalf of an adult participant may supply one component of the reimbursable meal as long as the component meets the requirements described in paragraphs (a), (b), and (c) of this section and the institution or facility provides the remaining components.
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(1) A sufficient amount of prepared food must be placed on each table to provide the full required portions of each of the components, as outlined in paragraphs (c)(1) and (2) of this section, for all children or adults at the table and to accommodate supervising adults if they wish to eat with the children and adults.
(2) Children and adults must be allowed to serve the food components themselves, with the exception of fluids (such as milk). During the course of the meal, it is the responsibility of the supervising adults to actively encourage each child and adult to serve themselves the full required portion of each food component of the meal pattern. Supervising adults who choose to serve the fluids directly to the children or adults must serve the required minimum quantity to each child or adult.
(3) Institutions and facilities which use family style meal service may not claim second meals for reimbursement.
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(B)
(C)
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(2) In pricing programs, the price of the reimbursable meal must not be affected if a participant declines a food item.
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Food and Drug Administration, HHS.
Proposed rule.
The Food and Drug Administration (FDA or we) is proposing to ban electrical stimulation devices used to treat aggressive or self-injurious behavior. FDA has determined that these devices present an unreasonable and substantial risk of illness or injury that cannot be corrected or eliminated by labeling. FDA is proposing to include in this ban both new devices and devices already in distribution and use.
Submit either electronic or written comments on the proposed rule by May 25, 2016.
You may submit comments as follows:
Submit electronic comments in the following way:
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• If you want to submit a comment with confidential information that you do not wish to be made available to the public, submit the comment as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).
Submit written/paper submissions as follows:
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• For written/paper comments submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”
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Rebecca Nipper, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. 1540, Silver Spring, MD 20993-0002, 301-796-6527.
FDA is proposing to ban electrical stimulation devices (ESDs) used for self-injurious or aggressive behavior. ESDs are devices that apply a noxious electrical stimulus to a person's skin upon the occurrence of a target behavior in an attempt to condition the individual over time to reduce or cease the behavior. Self-injurious behaviors (SIB) and aggressive behaviors (AB) frequently manifest in the same individual, and people with intellectual or developmental disabilities exhibit these behaviors at disproportionately high rates. Notably, many such people have difficulty communicating and cannot make their own treatment decisions because of such disabilities, meaning many people who exhibit SIB or AB are among a vulnerable population. SIB commonly include: Head-banging, hand-biting, excessive scratching, and picking of the skin. However, SIB can be more extreme and result in bleeding, protruding, and broken bones; blindness from eye-gouging or poking; other permanent tissue damage; or injuries from swallowing dangerous objects or substances. AB involve repeated physical assaults and can be a danger to the individual, others, or property. In our proposed rule, like much of the scientific literature, we discuss SIB and AB in tandem.
ESDs are intended to reduce SIB and AB according to the principle of aversive conditioning. Aversive conditioning pairs a noxious stimulus with a target behavior such that the individual begins to associate the noxious stimulus with the behavior, with the intended result being that the individual ceases engaging in the behavior and, over time, becomes conditioned not to manifest the target behavior. A noxious stimulus is one that is uncomfortable or painful; the noxious stimulus delivered by an ESD is an
The effects of the shock are both psychological (including suffering) and physical (including pain), each having a complex relationship with the electrical parameters of the shock. As a result, the subjective experience of the person receiving the shock can be difficult to predict. Physical reactions roughly correlate with the peak current of the shock delivered by the ESD. However, various other factors such as sweat, electrode placement, recent history of shocks, and body chemistry can physically affect the sensation. As a result, the intensity or pain of a particular set of shock parameters can vary greatly from patient to patient and from shock to shock. Possible adverse psychological reactions are even more loosely correlated with shock intensity in that the shock need not exceed certain physical thresholds. Rather, the shock need only be subjectively stressful enough to cause trauma or suffering. Trauma becomes more likely, for example, when the recipient does not have control over the shock or has developed a fear of future shocks, neither of which is an electrical parameter of the shock.
Whenever FDA finds, on the basis of all available data and information, that a device presents substantial deception or an unreasonable and substantial risk of illness or injury, and that such deception or risk cannot be, or has not been, corrected or eliminated by labeling or by a change in labeling, FDA may initiate a proceeding to ban the device. In making such a finding, FDA weighs the benefits against the risks posed by the device and considers the risks relative to the state of the art. With respect to ESDs for SIB and AB, FDA has weighed these factors based on consideration of information from a variety of sources, including the scientific literature, opinions from experts (including an advisory panel meeting), information from and actions of State agencies, information from the affected manufacturer, information from patients and their family members, and information from other stakeholders.
FDA has determined that ESDs for SIB or AB present a number of psychological and physical risks: Depression, fear, escape and avoidance behaviors, panic, aggression, substitution of other behaviors (
Our search of the scientific literature revealed a number of studies showing that ESDs result in the immediate interruption of the target behavior upon shock, and some of the literature also suggested varying degrees of durable conditioning. However, the studies in the literature suffer from serious limitations, including weak study design, small size, and adherence to outdated standards for study conduct and reporting. The conclusions of several of the studies are undermined by study-specific methodological limitations, lack of peer review, and author conflicts of interest. There is also evidence that the shocks are completely ineffectual for certain individuals.
FDA weighed the benefits against the risks. FDA recognizes that ESDs can cause the immediate interruption of self-injurious or aggressive behavior, but the evidence is otherwise inconclusive and does not establish that ESDs improve the underlying disability or successfully condition individuals to achieve durable long-term reduction of SIB or AB. The short-term effect of behavior interruption is outweighed by the numerous short- and long-term risks. For many individuals who exhibit SIB or AB, these risks are magnified by their inability to adequately communicate the harms they experience to their health care providers. Even if immediate cessation is achieved, without durable conditioning the target behavior will recur over time and necessitate ongoing shocks to cause immediate cessation, magnifying the risks. For some patients, the shocks are wholly ineffective and can lead to progressively stronger shocks with the same result. Thus the degree to which the risks outweigh the benefits increases over time.
When considering the reasonableness of the risk of illness or injury posed by a device in a banning proceeding, FDA also considers the state of the art. Notably, the use of aversive conditioning in general, and ESDs in particular, has been on the decline for decades; only one facility in the United States still uses ESDs for SIB and AB. This decline is due in part to scientific advances that have yielded new insights into the organic causes and external (environmental or social) triggers of SIB and AB, allowing the field to move beyond intrusive punishment techniques such as aversive conditioning with ESDs. Moreover, punishment techniques (which include the use of ESDs) are highly context-sensitive, so the same technique may lose effectiveness simply by changing rooms or providers. The evolution of the state of the art responded to this limitation by emphasizing skills acquisition and individual choice. The evolution is also due in part to the ethical concerns tied to the risks posed by devices such as ESDs, especially regarding the application of pain to a vulnerable patient population.
In light of scientific advances, out of concern for ethical treatment, and in an attempt to create generalizable interventions that work in community settings, behavioral scientists have developed safer, successful treatments. The development of the functional behavioral assessment, a formalized tool to analyze and determine triggering conditions, has allowed providers to formulate and implement plans based on positive techniques. As a result, multi-element positive interventions (
Based on all available data and information, FDA has determined that the risk of illness or injury posed by ESDs for SIB and AB is substantial and
The FD&C Act authorizes FDA to ban a device intended for human use by regulation if it finds, on the basis of all available data and information, that such a device presents substantial deception or an unreasonable and substantial risk of illness or injury. A banned device is adulterated except to the extent it is being studied pursuant to an investigational device exemption. This proposed rule is also issued under the authority to issue regulations for the efficient enforcement of the FD&C Act.
In determining whether a deception or risk of illness or injury is “substantial,” FDA will consider whether the risk posed by the continued marketing of the device, or continued marketing of the device as presently labeled, is important, material, or significant in relation to the benefit to the public health from its continued marketing. Although FDA's device banning regulations do not define “unreasonable risk,” FDA previously explained that, with respect to “unreasonable risk,” we will conduct a careful analysis of risks associated with the use of the device relative to the state of the art and the potential hazard to patients and users. The state of the art with respect to this proposed rule is the state of current technical and scientific knowledge and medical practice with regard to the treatment of patients exhibiting self-injurious and aggressive behavior.
Thus, in determining whether a device presents an “unreasonable and substantial risk of illness or injury,” FDA analyzes the risks and the benefits the device poses to individuals, comparing those risks and benefits to the risks and benefits posed by alternative treatments being used in current medical practice. Actual proof of illness or injury is not required; FDA need only find that a device presents the requisite degree of risk on the basis of all available data and information.
Whenever FDA finds, on the basis of all available data and information, that the device presents substantial deception or an unreasonable and substantial risk of illness or injury, and that such deception or risk cannot be, or has not been, corrected or eliminated by labeling or by a change in labeling, FDA may initiate a proceeding to ban the device.
If this proposed rule is finalized as proposed, the ban would include devices that apply a noxious electrical stimulus to a person's skin to reduce or cease aggressive or self-injurious behavior. The proposed ban would apply to devices already in commercial distribution and devices already sold to the ultimate user, as well as devices sold or commercially distributed in the future. A banned device is an adulterated device, subject to enforcement action. The ban may not, however, prevent further study of such devices pursuant to an investigational device exemption.
FDA is proposing to ban ESDs for the purpose of treating self-injurious or aggressive behavior. Because we lack sufficient information to quantify the benefits, we include a qualitative description of some potential benefits of the proposed rule. We expect that the rule would directly affect only one entity. In addition to the incremental costs this entity would incur to comply with the requirements of the proposed rule, there would be potential transfer payments of between $11.5 million and $15 million annually either within the affected entity or between entities. The present value of total costs over 10 years ranges from $0 million to $60.1 million at a 3 percent discount rate, and ranges from $0 million to $51.4 million at a 7 percent discount rate. Annualized costs range from $0 million to $6.8 million at a 3 percent discount rate and range from $0 million to $6.8 million at a 7 percent discount rate.
Electrical stimulation devices (ESDs) for self-injurious behavior (SIB) or aggressive behavior (AB) are devices that apply a noxious electrical stimulus (a shock) to a person's skin to reduce or cease such behaviors. Although FDA cleared a few of these devices more than 20 years ago, due to scientific advances and ethical concerns tied to the risks of ESDs, state-of-the-art medical practice has evolved away from their use and toward various positive behavioral treatments, sometimes combined with pharmacological treatments. Only one facility in the United States has manufactured these devices or used them on individuals in recent years. As a result of this evolution in treatment over the past several decades, the available data and information on the risks and benefits of ESDs are limited.
Although the available data and information show that some individuals subject to ESDs exhibit an immediate reduction or cessation of the targeted behavior, the available evidence has not established a durable long-term conditioning effect or an overall-favorable benefit-risk profile for ESDs for SIB and AB. No randomized, controlled clinical trials have been conducted, and the studies that have been conducted are generally small and suffer from various limitations, including the use of concomitant treatments over long periods that make it difficult to determine the cause of any behavioral changes. The medical literature shows that ESDs present risks of a number of psychological harms including depression, posttraumatic stress disorder (PTSD), anxiety, fear, panic, substitution of other negative behaviors, worsening of underlying symptoms, and learned helplessness (becoming unable or unwilling to respond in any way to the ESD); and the devices present the physical risks of pain, skin burns, and tissue damage.
Because the medical literature likely underreports adverse events (AEs), risks identified through other sources, such as from experts in the field, State agencies that regulate ESD use, and records from the only firm that has recently manufactured and is currently using ESDs for SIB and AB demand closer consideration. As discussed in section II.A, these sources further support the risks reported in the literature and indicate that ESDs have been associated with additional risks such as suicidality, chronic stress, acute stress disorder, neuropathy, withdrawal, nightmares, flashbacks of panic and rage, hypervigilance, insensitivity to fatigue or pain, changes in sleep patterns, loss of interest, difficulty concentrating, and injuries from falling. In contrast to the state of the art for the treatment of SIB and AB, the risks of ESDs are unreasonable.
As discussed later in this document, FDA has determined that ESDs present a substantial and unreasonable risk of illness or injury and that the risks cannot be corrected or eliminated by labeling. Thus, FDA has decided to ban these devices under section 516 of the Federal Food, Drug, and Cosmetic Act (the FD&C Act) (21 U.S.C. 360f). The proposed rule applies to devices already in distribution and use, as well as to future sales of these devices.
SIB and AB are among the most striking and devastating conditions associated with intellectual and developmental disabilities (Ref. 1). Individuals with such disabilities may exhibit destructive behavior that falls within two major categories, self-injury and aggression toward others or property. The most common forms of self-injury include head-banging, hand-biting, excessive scratching, and picking of the skin. The most extreme cases of persons with serious self-injurious behavior afflict an estimated 25,000 or more individuals in the United States (Ref. 2). These more extreme behaviors usually involve repeated, self-inflicted, non-accidental injuries producing, for example: (1) Bleeding, protruding, and broken bones; (2) eye gouging or poking leading to blindness; (3) other permanent tissue damage; and (4) swallowing dangerous substances or objects. (For a more detailed technical discussion, see Ref. 3.)
Persons who exhibit SIB also frequently demonstrate aggression, the other major category of destructive behavior. Aggressive behaviors encompass a wide range of behaviors, which are generally defined by conduct that, due to its intensity or frequency, presents an imminent danger to the person who demonstrates it, to other people, or to property (see,
The majority of published studies on SIB include aggression either as part of the description of the clinical spectrum of the behavior or as an inclusion criterion for the clinical study. Accordingly, this proposed rule addresses self-injury and aggression in tandem as SIB and AB. Destructive behavior in both major categories—aggression and self-injury—are often present in individuals with intellectual or developmental disabilities. Examples of those disabilities include, but are not limited to: Autism spectrum disorder, Cornelia de Lange syndrome, Down syndrome, Fragile X syndrome, hereditary sensory neuropathy, Lesch-Nyhan syndrome, Rett syndrome, and Tourette syndrome. Those disabilities may also include visual impairment, severe intellectual impairment, and a variety of cognitive and psychiatric disorders.
Estimates of the prevalence of SIB in individuals with intellectual or developmental disabilities range from 2.6 percent to 40 percent (Ref. 7), or 2 to 23 percent in community samples (Ref. 8). More recently, one analysis found a prevalence of SIB in a clinical population of children with developmental disabilities at 32 percent, suggesting that the actual prevalence may be at the high end of earlier estimates (Ref. 9). Estimates of the prevalence of AB in individuals with intellectual or developmental disabilities range as high as 52 percent, though 10 percent is more commonly reported (Ref. 8). Thus, by conservative estimates, counting only individuals who have intellectual or developmental disabilities (and not all people who manifest SIB or AB), at least 330,000 people in the United States manifest SIB, AB, or both; less conservative estimates are much higher (see Refs. 3 and 8).
As stated, ESDs apply a noxious electrical stimulus (a shock) to a person's skin upon the occurrence of a target behavior in an attempt to reduce or cease the behavior. As such, ESDs are a type of aversive conditioning device (“aversive”). ESDs apply shocks to the skin. ESDs are not used in ECT, sometimes called electroshock therapy, which is unrelated to this rulemaking. The electrical shock from an ESD is intended to interrupt the undesirable behavior and result in its quick cessation. Repeatedly pairing the shock with the unwanted behavior is intended to cause individuals to associate the two and thereby induce them to decrease the frequency of the behavior or stop it altogether. In order to achieve the intended results, the shock must be applied during the behavior (for cessation and decrease) or immediately afterward (for decrease). ESDs are intended to affect behavior in two ways: By interrupting the target behavior as an immediate response to the stimulus and, over time, through a conditioned reduction in the target behavior.
The main components of ESDs are an electrical stimulus generation module, electrodes, and a trigger switch. Either a remote monitor module or an automatic mechanism can trigger the electric shock to the individual. Typically, the patient carries the stimulus generation module, which applies an electrical current (the shock) to the individual's skin via electrodes. When a remote monitor is used, an observer determines when to apply an electrical shock to the patient and triggers a shock from a specific stimulus generation module via a radiofrequency signal. Alternatively, a sensor can detect certain unwanted behaviors and automatically activate the generation module. For example, an accelerometer attached to the head could detect head-banging and, when the behavior is severe enough, trigger an electrical shock.
Although several factors specific to the patient affect shock perception, the key device output characteristics that most affect shock perception include: Electric current, voltage, skin resistance (or load), pulse width, shock duration, output frequency and waveform, electrode characteristics (
Electric current, measured in milliamperes (mA) for ESDs, is the primary variable for determining the effects of an electric shock that passes through the body. To determine the current output of a device designed to deliver a constant voltage, the voltage is divided by the electric resistance, measured in ohms (Ω), the relationship described by Ohm's Law. A lower resistance for a given voltage results in higher current; the skin's conducting resistance can vary between 1 kΩ and 100 kΩ (Refs. 10 and 11). Sweat and blood are excellent conductors and therefore lower the conducting resistance, which increases the current and the intensity of the stimulus.
The sensory nerves respond to the current as a function of its strength and duration. A stronger current will elicit a response with a shorter pulse width, and a weaker current will need a longer pulse width to elicit the same response. The pulse width (or pulse duration) is the length of time a pulse of current is applied to the skin, measured in milliseconds for ESDs. Longer pulse durations have been shown to increase the intensity or unpleasantness of the sensation in healthy subjects (Refs. 12-14).
The characteristics of the electrodes that deliver the shock to the skin also affect the perception of the shock. The amount of current delivered per unit area of an electrode is referred to as the current density. A higher current density has been found to correspond with a more intense or unpleasant feeling (Refs. 15 and 16). One study has shown that smaller electrodes deliver painful shocks that are described as sharp, cutting, or lacerating. Larger electrodes for the same current are associated with pain that was pinching, pressing, or gnawing (Ref. 16). A related measure, power density, is found by multiplying the current and the voltage and relating the product to surface area; it is expressed as watts per unit area. Both current and power densities correlate with the risk of burns; a higher current or power density increases the risk. The risk of burns also increases when the current itself is direct current; all FDA-cleared ESDs utilize alternating current (AC) rather than direct current (DC).
Electrodes additionally affect pain sensation in that placement on locations with a higher density of sensory nerves will result in more pain. For that reason, the hands, feet, genitals, underarms, torso, neck, and face will be particularly sensitive to shocks. Repeated shocks to the same location will also alter the perception, increasing intensity or pain (Refs. 17-19). The exact mechanism behind this change is unclear, but one hypothesis holds that the changing sensation may result from changes in the skin's electrical resistance (Ref. 19). Others have hypothesized that repeated stimulation depletes endorphins, which are chemicals that affect pain sensation (Ref. 17).
Finally, with regard to key device output parameters, some authors have attempted to relate physiological responses, sensations and muscle contraction for example, to electric current (
These key device output parameters affect the experience of the shock primarily in terms of physiological responses (see Ref. 3 for a more technical discussion). As explained in more detail in section II.A.1, a stimulus need not be physically intense to trigger an adverse psychological reaction. Thus, although lower peak current or shorter pulse duration corresponds with lower physical intensity, neither necessarily corresponds with a less-adverse psychological response. Table 1 summarizes the device output characteristics of ESDs for SIB or AB
Again, individual patient variability makes comparison across devices—and even individual shock applications—difficult. Some people are generally highly sensitive to current, experiencing involuntary muscle contraction from static electric shocks. On the other end of the spectrum, some individuals can draw a large static electric spark and hardly perceive it, much less experience a muscle spasm. Studies of subjects without intellectual or developmental disabilities have demonstrated a large range of intersubject variability for equally applied shocks. For example, one study found that the range of pain thresholds was 3.9 to 11.6 mA (Ref. 11), while another found the range was 0.45 to 2.4 mA (Ref. 25). Such articles often did not include key output characteristics, such as pulse width and frequency or electrode size and placement, further confounding attempts to compare or apply the findings. In light of variability and methodological limitations underlying the reported current-response relationships, physiological responses, including pain perception, are difficult to predict accurately, especially based solely on the current.
In 1979, FDA classified aversive conditioning devices as class II (see § 882.5235 (21 CFR 882.5235)), which was consistent with the recommendation of the Neurological Device Classification Panel of the Medical Device Advisory Committee in 1978. Such devices may or may not use electric shocks to administer a “noxious stimulus to a patient to modify undesirable behavioral characteristics” (§ 882.5235). Thus, ESDs intended to treat SIB and AB are within the aversive conditioning device classification regulation. The proposed rule for classifying aversives, including ESDs, focused on the risks of: (1) Worsened psychological conditions, (2) errant electric shocks, and (3) the harmful or lethal nature of excess electric current or its inappropriate application (43 FR 55705, November 28, 1978). At the time, FDA and the panelists believed that performance standards could adequately assure the safety and effectiveness of aversives. We received no comments from the public on the proposed rule, and we issued the final rule classifying aversives as proposed at § 882.5235 (44 FR 51726 at 51765, September 4, 1979).
FDA has cleared four devices for the treatment of SIB as substantially equivalent to the ones initially placed into class II, 510(k) notification numbers and clearance dates in parentheses:
• Stimulator Sonic Control, “Whistle Stop” (K760166; July 20, 1976);
• Self-Injurious Behavior Inhibiting System, “SIBIS” (K853178; February 28, 1986);
• SIBIS Remote Actuator (K871158; May 29, 1987); and
• Graduated Electronic Decelerator, “GED” (K911820; December 5, 1994).
A prescription is required for each, meaning that Federal law restricts the sale of these aversives to professionals licensed according to State requirements or those acting pursuant to a licensed professionals orders (see 21 CFR 801.109).
As part of the evaluation of the premarket notifications,
We are aware of only one manufacturer, JRC, that has recently manufactured ESDs and that currently uses ESDs, including devices that we have not previously cleared. JRC uses these devices because it is also a residential facility, and its employees apply the devices to individuals there. In 2000, FDA incorrectly notified JRC that it qualified for exemption from registration and 510(k) requirements under 21 CFR 807.65(d). Once FDA recognized its error, FDA sent JRC an Untitled Letter on May 23, 2011, and a Warning Letter on December 6, 2012, for violations related to the lack of FDA clearance or approval for the modified GED devices.
FDA now has a better understanding of the risks and benefits presented by these devices than it did 36 years ago when these devices were classified, and, as discussed later in sections II.A and II.B, the state of the art for the treatment of SIB and AB has progressed significantly over that time period. As a result, FDA now believes that the risk of illness or injury from the use of ESDs for the treatment of SIB and AB is unreasonable and substantial.
The ban would apply to devices that apply a noxious electrical stimulus to a person's skin to reduce or stop aggressive or self-injurious behavior. (See section I.B for a discussion of the relevant behaviors; see also Ref. 3 for a more technical discussion of the scientific literature regarding these behaviors.) To FDA's knowledge, the only such devices that are currently in use are two models of the GED device (the GED-3A and GED-4), neither of which has been cleared or approved by the Agency.
The ban would not apply to ESDs used to create aversions to other conditions or habits, such as smoking. Although other ESDs have parallels in
Importantly, individuals who manifest SIB or AB typically have additional vulnerabilities that relate directly to the risks of the treatment method. For example, individuals with intellectual or developmental disabilities who manifest SIB or AB, and who have difficulty communicating pain or other harms that may be caused by ESDs would bear a higher risk of injury from the shock than smokers who choose to use an ESD to help quit smoking. Those smokers, if without intellectual or developmental disabilities, can immediately communicate pain to the device's controller or remove the device themselves. They can communicate symptoms of other harms that may be caused by ESDs, such as PTSD, to their health care provider, which may lead to discontinuation of the device's use. Communication challenges in patients who suffer from SIB and AB are discussed in the literature, were raised by the advisory panel, and are reviewed in more detail in section II.A.
Section 516 of the FD&C Act authorizes FDA to ban a device intended for human use by regulation if it finds, on the basis of all available data and information, that such a device “presents substantial deception or an unreasonable and substantial risk of illness or injury” (21 U.S.C. 360f(a)(1)). A banned device is adulterated under section 501(g) of the FD&C Act (21 U.S.C. 351(g)), except to the extent it is being studied pursuant to an investigational device exemption under section 520(g) of the FD&C Act (21 U.S.C. 360j(g)). This proposed rule is also issued under the authority of section 701(a) of the FD&C Act (21 U.S.C. 371(a)), which provides authority to issue regulations for the efficient enforcement of the FD&C Act.
In determining whether a deception or risk of illness or injury is “substantial,” FDA will consider whether the risk posed by the continued marketing of the device, or continued marketing of the device as presently labeled, is important, material, or significant in relation to the benefit to the public health from its continued marketing (see § 895.21(a)(1) (21 CFR 895.21(a)(1))). Although FDA's device banning regulations do not define “unreasonable risk,” in the preamble to the final rule promulgating 21 CFR part 895, FDA explained that, with respect to “unreasonable risk,” it “will conduct a careful analysis of risks associated with the use of the device relative to the state of the art and the potential hazard to patients and users” (44 FR 29214 at 29215, May 18, 1979; Ref. 25a). The state of the art with respect to this proposed rule is the state of current technical and scientific knowledge and medical practice with regard to the treatment of patients exhibiting self-injurious and aggressive behavior.
Thus, in determining whether a device presents an “unreasonable and substantial risk of illness or injury,” FDA analyzes the risks and the benefits the device poses to individuals, comparing those risks and benefits to the risks and benefits posed by alternative treatments being used in current medical practice. Actual proof of illness or injury is not required; FDA need only find that a device presents the requisite degree of risk on the basis of all available data and information (H. Rep. 94-853 at 19; 44 FR 28214 at 29215).
Whenever FDA finds, on the basis of all available data and information, that the device presents substantial deception or an unreasonable and substantial risk of illness or injury, and that such deception or risk cannot be, or has not been, corrected or eliminated by labeling or by a change in labeling, FDA may initiate a proceeding to ban the device (see § 895.20). If FDA determines that the risk can be corrected through labeling, FDA will notify the responsible person of the required labeling or change in labeling necessary to eliminate or correct such risk (see § 895.25).
Section 895.21(d) requires this proposed rule to briefly summarize:
• The Agency's findings regarding substantial deception or an unreasonable and substantial risk of illness or injury;
• the reasons why FDA initiated the proceeding;
• the evaluation of the data and information FDA obtained under provisions (other than section 516) of the FD&C Act, as well as information submitted by the device manufacturer, distributer, or importer, or any other interested party;
• the consultation with the classification panel;
• the determination that labeling, or a change in labeling, cannot correct or eliminate the deception or risk;
• the determination of whether, and the reasons why, the ban should apply to devices already in commercial distribution, sold to ultimate users, or both; and
• any other data and information that FDA believes are pertinent to the proceeding.
• Evaluation of data and information regarding ESDs, including data and information FDA obtained under provisions other than section 516 of the FD&C Act, information submitted by the device manufacturer and other interested parties, the consultation with the classification panel, and other data and information that FDA believes are pertinent to the proceeding, with respect to risks, benefits, and the state of the art;
• the reasons FDA initiated the proceeding and FDA's determination that ESDs for SIB and AB present an unreasonable and substantial risk of illness or injury (FDA has not made a finding regarding substantial deception);
• FDA's determination that labeling, or a change in labeling, cannot correct or eliminate the risk; and
• FDA's determination that the ban applies to devices already in commercial distribution and sold to ultimate users, and the reasons for this determination.
In considering whether to ban ESDs, FDA first conducted an extensive, systematic literature review to assess the benefits and risks associated with ESDs as well as the state of the art of treatment of patients exhibiting SIB and AB. In the literature review, as explained earlier, SIB and AB were considered in tandem, and these conditions presented in individuals with intellectual and developmental disabilities, such as autism spectrum disorder, Down syndrome, Tourette syndrome, as well as other cognitive or psychiatric disorders and severe intellectual impairment (including a broad range of intellectual measures). The studies encompassed both children and adults. (For more technical details, see Ref. 3.)
FDA next convened a meeting of the Neurological Devices Panel of the Medical Devices Advisory Committee (“the Panel”) on April 24, 2014 (“the Panel Meeting”), in an open public forum, to discuss issues related to FDA's consideration of a ban on ESDs for SIB and AB (see 79 FR 17155, March 27, 2014; Ref. 26). Although FDA is not
FDA considered all available data and information from a wide variety of sources, including from the categories listed in this document. In weighing each piece of evidence, FDA took into account its quality, such as the level of scientific rigor supporting it, the objectivity of its source, its recency, and any limitations that might weaken its value. Thus, for example, we generally gave much more weight to the results of a study reported in a peer-reviewed journal than we did to non-peer-reviewed papers.
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FDA conducted an extensive, systematic review of the medical literature for harms,
Further, a series of less traumatic events can cause the development of stress disorders such as PTSD. The underlying trauma need not be a single, discrete event, although a single trauma can lead to PTSD (Ref. 32; see also Ref.
Several articles reported aversion, fear, and anxiety in response to ESDs. One article states that ESDs may initially evoke fear, panic, and even aggression responses (Ref. 34). For the most part, researchers have interpreted these events as anticipatory responses prior to or upon stimulus application. In addition to reports of panic and bouts of aggression, others have reported events such as screaming, crying, or shivering upon device application; grimacing; flinching; perspiring; and escape behavior (Refs. 34-43). One article reported a temporary aversion to the experimenter (Ref. 36). Such fear, anxiety, or panic reactions are additionally concerning because when they cause the individual to sweat, they would lead to electrical conductivity changes across the skin that increase the intensity of the electric shock.
Other articles report substitution of behaviors—negative or collateral—that span a range of severity. One author speculated that, in institutional settings, “the probability that a replacement behavior will be undesirable is quite high” (Ref. 44). Some patients “froze by refraining from showing any sort of behavior” (Ref. 34). Similarly, others reported a “pseudocatatonic sit-down,”
Temporary or long-term increases in symptoms have also been attributed to ESDs in the literature. One article reported increases in emotionality and the frequency of self-injury, as well as post-treatment incontinence (Ref. 49). Another observed increasing episodic “bursts” of self-injury, eventually reaching the point that extended treatment with the ESD became impossible to maintain (Ref. 50).
Some ESDs have been used for conditions other than SIB and AB,
One article on the effects of shock on five subjects to reduce obsessions and compulsions reported that one subject demonstrated anxiety and psychotic delusions (Ref. 51). One case-control study on ESDs used to treat alcohol dependence in 12 subjects found that symptoms of experimental repression, such as headaches, restlessness, and mild dysphoria, were common and appeared usually within 3 or 4 days of the treatment (Ref. 52). Another researcher performed a prospective study of ESDs used for smoking cessation in 14 subjects. The author reported that seven subjects exhibited mild transient depression (Ref. 53). FDA acknowledges that confounding factors potentially contributed to these AEs.
Since ESDs are aversive conditioning devices, FDA also considered AEs associated with aversive conditioning more generally. We identified 12 review articles examining AEs associated with punishment or aversive conditioning. Many of the reviews acknowledge the possibility of negative emotional reactions associated with punishment in general, such as fear or avoidance (Refs. 54-59) and anxiety and depression (Ref. 54). Some reviews, similar to the findings specific to ESDs, noted AEs that include retaliation, increased aggression, or substitution of one injurious behavior for another (Refs. 54 and 57-60).
FDA believes that the risks posed by another type of device that delivers a shock to the patient are instructive. Specifically, a comparison to implantable cardioverter defibrillator (ICD) devices further supports the potential for certain psychological risks in patients receiving shocks from ESDs for SIB and AB. While the strength and purposes of the shock differ significantly between ICDs and ESDs, the psychological risks posed by ESDs do not necessarily depend on the strength of the shock, as discussed earlier, and FDA does not believe the different purposes of the shocks undermine the comparison for the following reasons. Treatment with either of these devices entails several similar characteristics that support a comparison, including the lack of patient control over the shocks, the application of multiple shocks, and the startling or unpleasant nature of the shocks. We found that fear of future shocks, in particular, is a trauma that is shared for both the ICD and ESD populations, unlike other trauma experiences in which subsequent trauma (repetition of the experience) is unlikely, indicating that ongoing application worsens the harm (Ref. 61).
The following risks have been reported in the literature for ICDs: The development of PTSD, acute stress disorder, a shock stress reaction (a temporary condition), learned helplessness, depression, and anxiety (Refs. 61-63). A contributing factor in the development of these harms in patients with an ICD may be that treatment with an ICD may act as a constant reminder of the underlying life-threatening disease condition (Ref. 64). A 2011 report observed that “[t]he available research literature can only provide a limited view of whether ICD shock or the potentially life-threatening arrhythmic condition is the primary driver of a PTSD presentation” (Ref. 61). However, Sears and Conti report that “[s]hock is the major distinguishing factor between patients with ICDs and general cardiac patient populations” (Ref. 63), meaning that the presence of an ICD, rather than the underlying cardiac condition, increases the psychological risks. Other authors have reported that ICD shocks may cause distress either from the associated pain, skeletal muscle contraction, and nerve
Because of the similar characteristics of the shocks delivered by ICDs and ESDs, and because the identified risks may be attributable to the ICD shock itself, as opposed to the fear of a life-threatening condition, the risks of development of PTSD or a shock stress reaction, learned helplessness, depression, or anxiety may also exist when shocks are applied by ESDs in patients with SIB or AB. FDA notes that due to the drastically different intended uses, patient populations, benefit-risk profiles, and state of the art for these devices, FDA is not considering banning ICDs.
The literature contains many reports of tissue damage or burns from ESDs. Reports of skin damage ranged from burns to bruises to slightly reddened or discolored areas. In all such reports, the effects were temporary (Refs. 29, 30, 39, 41, 50, and 65).
Given that ESDs achieve their intended effects by causing an aversion with an electric shock, it is not surprising that researchers have reported experiencing or observing pain upon ESD application to themselves or their patients. For example, one experimenter stated that he definitely felt pain when he applied the ESD to himself. He described it like a dentist drilling on an un-anesthetized tooth, but the pain terminated when the shock ended (Ref. 36). Another report observed pain upon stimulation by the ESD (Ref. 35), and another observed a tremor in the thigh (Ref. 36). Although ESDs are intended to apply an aversive stimulus, and any pain that results from ESDs may cause an aversive reaction, pain is nonetheless a harm that should be considered in our analysis of risks posed by the device.
Finally, two articles reported misapplication or device failure (Refs. 39 and 65). In such cases, there is a risk that any of the harms discussed in this section may occur but without any possibility of benefit.
The Agency's analysis indicates that the medical literature suffers from some significant limitations and has likely underreported AEs associated with ESDs for a number of reasons. Perhaps most importantly, the devices have been studied only on a very small number of subjects, many of whom would have difficulty communicating or otherwise demonstrating AEs and injuries. The bulk of the articles describe case reports or series, employing only retrospective reviews of clinical experience, not prospective studies. Further, most of the research articles were published in the 1960s and 1970s, before significant advances in the ability to diagnose and classify psychological AEs such as PTSD. The dated nature of most of the research also means it did not adhere to modern standards for AE monitoring. Simply put, researchers likely did not report AEs because they had not planned to study them separately. None of the articles on the application of ESDs described an attempt to assess AEs systematically, and many articles did not state whether the authors attempted to assess AEs at all. Finally, researcher bias also may have contributed to underreporting of AEs.
As noted, the literature review suggests some subjects' difficulty with reporting AEs due to the subjects' disability likely hindered any assessment of AEs, particularly psychological AEs. Since SIB and AB often present in individuals with cognitive, intellectual, or psychiatric conditions, SIB and AB affect many individuals with diminished communication abilities. Patients who exhibit SIB or AB may not offer—or providers may not recognize—feedback indicating injuries from misfires or other erroneous applications of ESDs. For example, conditions such as an autism spectrum disorder may impair expressions of pain (see Ref. 66 for a discussion of pain sensitivity and expression in autistic individuals). In such a case, an AE could go unrecognized because the provider does not understand the individual's response, if any.
Worse, some individuals' impaired ability to communicate, express themselves, or associate cause and effect, coupled with the difficulty providers may have in distinguishing underlying symptoms from negative effects of ESDs, compounds the dangers posed by these devices. This is because individuals' impairments with communication or stimulus association may prevent the individuals and their health care providers from mitigating or avoiding both physical and especially psychological harms. (See section II.C.1 for a discussion of interventions that do not rely on stimulus association.) In such circumstances, ESDs are riskier than for other patients on whom ESDs are used.
For the reports of AEs that do exist, many of those researchers published during the 1960s and 1970s, an era when conceptions of disease and how a person's physiology may affect or cause disease,
The Agency's analysis also suggests the possibility of bias against reporting AEs. As previously noted, the majority of articles did not define a systematic method for assessing AEs. In one review, the authors concluded that there was no evidence associating AEs with ESDs (Ref. 67). However, the authors went on to opine, “in light of the intrusive nature of shock treatment, it is puzzling that so few negative side effects have been reported. In interpreting the existing literature, we might be wise to consider the possibility that some investigators have been predisposed to see only the positive side effects.” Similarly, the reports of treatment relapse in the literature may not reflect the actual prevalence in clinical settings because such cases are less likely to be submitted or accepted for publication (Ref. 59).
Potential bias against AE reporting might also have influenced the authors of the article that included the largest group of individuals (60) subject to ESD application in its retrospective review. The review noted only one negative side effect, “temporary discoloration of the skin that cleared up in a few minutes or days” (Ref. 30). However,”temporary emotional behaviors, a temporary tensing of the body, or attempts to remove the device or grab the transmitter noted during treatment were classified as 'immediate collateral behavior' and were not considered adverse events” (Ref. 30). The lead author of this article, Dr. Matthew Israel, may also have been biased in his roles as founder of JRC and Chief Executive
In light of the foregoing, FDA believes that researchers, by current clinical and peer-review standards, likely underreported AEs. Many patients on whom ESDs have been used have limited ability to express themselves. Some earlier studies considered certain reactions that we would now consider to be AEs as mere responses or even treatment requirements. Even current researchers may classify AEs as unwanted side effects that then go unreported. For example, of the 66 patient case histories spanning 1991 through 2014 that FDA received from JRC, none reported any AEs, which is highly unusual for so many patients over such a long time (though individual exposure periods varied). Nor did any of these case histories include systematically defined methods for short- or long-term AE monitoring. Thus, even the more recent studies may still reflect outmoded standards. Significantly, because much of the relevant literature was published many years ago, it does not benefit from recent advancements in psychiatric pathophysiology that have expanded researchers' ability to identify and record AEs. In light of the foregoing, we conclude that realized risks and dangers to individuals' health from ESDs are likely greater than reported in the medical literature. As a result, the risks posed by ESDs reported by other sources, discussed in the following sections, warrant careful consideration.
FDA presented the following dangers to individuals' health related to the use of ESDs at the Panel Meeting: Negative emotional reactions or behaviors, including aggression; burns and other tissue damage; anxiety; acute stress, or PTSD; fear and aversion or avoidance; pain or discomfort; depression and possible suicidality; psychosis; and neurological symptoms and injury. The panelists generally opined that the list was incomplete, and in some cases, too vague and in need of clarification (see Ref. 68).
One panelist noted peripheral nerve injury as a possible side effect and was surprised JRC had not reported severe depression, especially since “producing pain in people who have no control over the pain” is “a perfect paradigm for the learned helpless,” and learned helplessness is used in drug studies “because it produces in animals something analogous to depression and it can be used to test antidepressants.”
Another panelist stated that cardiac effects, renal effects, muscle damage, and neurological symptoms, such as neuropathy, could be happening at low levels but go unreported because there has not been a systematic look at these types of potential injury over the last 40-50 years.
Other panelists recommended specific additions and refinements to the list of risks and dangers, including: Equipment malfunction; long-term effects of pain; delineation of range of pain; trauma from falls; mistrust of providers; learned helplessness; chronic stress; generalized behavioral suppression; small, repetitive damage of other tissues; cognitive impairment; neuropathy; ventricular fibrillation if the electrodes are placed transthoracically; neuropsychiatric symptoms; and emotional sequelae.
Several Panel members echoed the concerns discussed earlier regarding the likelihood of underreporting of AEs. For example, one Panel member pointed out that the populations treated with ESDs are very vulnerable and may not be able to self-report AEs. Panelists also indicated that because clinicians have little understanding of the breadth and the range of pain experienced by ESD patients, clinicians may mistakenly attribute adverse effects to the patients' cognitive, intellectual, or psychiatric conditions rather than to the device. Some panelists observed that many of the risks and dangers of ESDs resemble co-morbidities in the individuals subject to treatment; as a result, adverse effects of the device would be difficult to distinguish from symptoms of the disability. This could result in AEs being misperceived as underlying symptoms, the likelihood of which is supported by the lack of systematic evaluation of AEs in the literature discussed in section II.A.2. Panel members similarly expressed concerns about communication and diagnosis difficulties exacerbating the harms experienced by patients on whom ESDs are used.
In his expert report, Dr. Smith explains that ESDs for SIB or AB “necessarily involve inflicting pain on a person with [an intellectual or developmental disability],” and notes the risks of fear and agitation observed in one study. Dr. Smith details several limitations to the studies on ESDs in the literature, including the failure of any of the studies to have a prespecified, systematic plan for monitoring AEs, which may have resulted in underreporting of AEs. He also discusses the possibility that the publication process may also introduce a bias against reporting AEs in the retrospective single-patient studies relied on by many researchers of ESDs. This is because, according to Dr. Smith, when studying only one patient, researchers tend to emphasize data that epitomize experimental control rather than an average response to the device (Ref. 8). Further, researchers generally tend to publish clear-cut results rather than less-clear outcomes (Ref. 8). Although he notes that the “overall strength of evidence is low” with respect to both benefit and harm, Dr. Smith concludes that “existing evidence shows that aversive conditioning with electric shock can be safe and effective in at least some cases, but that it can also be misapplied, risking severe, negative consequences” (Ref. 8).
A comment submitted by the Disability Law Center includes a 2014 expert affidavit from Dr. James Eason, a university instructor of biomedical engineering with a Ph.D. in biomedical engineering and a B.S. in electrical engineering who has particular expertise on ICDs (Ref. 69, attachment 2). Dr. Eason opines on the potential hazards posed by three ESDs: The SIBIS (cleared by FDA in 1986), the GED-1 (cleared by FDA in 1994), and the GED-4 (not FDA cleared or approved). Focusing on peak current, based on his views on the relationship between certain electrical stimulus parameters and pain, Dr. Easton compares the SIBIS (4.1 mA), GED-1 (30 mA), and GED-4 (90 mA), with an electrical fence (4 mA), a dog training collar (2-4 mA), and a cattle prod (10 mA), respectively.
Dr. Eason opines that, when applied to non-sensitive locations such as the arm or leg, the SIBIS shock falls below the range usually considered painful; the GED-1 shock falls within the range of pain thresholds, meaning some would find it painful and some may not; and the GED-4 shock would be painful or extremely painful to anyone. According to Dr. Eason, when the electrodes are placed on sensitive parts of the body, such as hands, feet, underarms, torso, or neck, all three ESDs are capable of inflicting extreme pain on anyone. Dr. Eason explains that sweating, which may be caused by stress or anxiety about receiving a shock, lowers skin resistance, which in turn may lower one's pain threshold, and that one's pain threshold may also be lowered by repeated shocks. He further concludes all three devices are capable of producing tissue damage due to strong muscle contractions, and all are capable of causing superficial skin burns under certain circumstances.
Dr. Eason also concludes that the ESDs “are likely to induce an immediate increase in physiological stress ranging from mild to severe. Further, the long-term effects of receiving numerous painful and uncontrollable shocks will be an increased risk for developing ASD or PTSD.” His conclusion is based partly on observations of people who have ICDs, which have been shown to induce psychological trauma, including PTSD, as discussed in section II.A.1. Finally, Dr. Eason believes the GED-4 presents a risk of heart palpitations, long-term psychological disorders, and neurological effects.
Dr. Eason's expert opinion is consistent with other available data and information demonstrating that ESDs can be painful, particularly when placed on sensitive areas, and that physiological and psychological factors contribute to the experience of pain. However, as explained in section I.C, because an individual's experience of pain varies significantly based on many factors, pain predictions based on peak current are subject to considerable uncertainty. As such, although higher peak currents correspond to greater risks of physical illness or injury, the peak current is but one factor in an individual's experience. Similarly, pain is but one risk of physical harm that ESDs pose. The devices pose serious risks of other short- and long-term psychological and physical harms, as discussed in the literature and at the Panel Meeting.
FDA reviewed complaints regarding ESD use made to the Massachusetts Disabled Persons Protection Committee (DPPC) from August 30, 1993, to July 28, 2013. Of 53 complaints, DPPC screened out 18 as not meeting complaint criteria; DPPC found 22 more were unsubstantiated. The remaining 13 complaints described the following AEs: Burns or tissue injury (6 reports), inappropriate device use (3 reports), negative emotional reactions (3 reports), and PTSD (1 report).
In 2007, the Massachusetts Department of Early Education and Care (DEEC) conducted an investigation of JRC's Stoughton Residence, where GED devices were used on individuals living there (Ref. 70). According to the Investigation Report, an individual reported waking up because his roommate was screaming; his roommate had been asleep but was shocked by a GED, waking him and causing him to scream. JRC staff reported that “the skin was off of the area” of the leg where GED shocks had been applied, that the GED was removed from the leg “because the area on was too bad to keep the device,” and either the individual who received the shocks or the staff (it is not clear who) believed a stage two ulcer was in the area where skin was missing (Ref. 70).
In 2006, the New York State Education Department (NYSED) conducted an onsite review of JRC's behavior intervention programs, with purposes including identification of any health and safety issues relating to JRC's use of aversive interventions (Ref. 71). The review was conducted by NYSED staff and three behavioral psychologists serving as independent consultants. It included a review of school policies, student records, observations of school and education programs, and interviews with staff and randomly selected individuals living at JRC. The reviewers witnessed staff rotating GED electrodes on individuals' bodies at regular intervals to “prevent burns that may result from repeated application of the shock to the same contact point” (Ref. 71).
During interviews, individuals reported “pervasive fears and anxieties related to the interventions used at JRC,” which include other interventions in addition to the GED devices. Although not reported as relating specifically to GED use, one patient stated she felt depressed and fearful, that her greatest fear was having to stay at JRC past her 21st birthday, and that she thought about killing herself every day. The review notes various other potential negative effects that may result from aversive behavioral strategies, such as depression, social withdrawal, aggression, and worsening of PTSD symptoms in individuals diagnosed with PTSD, though it did not report any specific instances of these adverse effects related to GED use.
NYSED also submitted a comment to the 2014 Panel Meeting docket stating that it has received reports of collateral effects from the use of these devices, such as increases in aggression and increases in escape behaviors or emotional reactions. NYSED states it has received “numerous reports of students who have incurred physical injuries (burns, reddened marks on their skin) as a result of being shocked and for whom parents and students themselves have reported short-term and long-term trauma effects as a result of use of such devices or watching other students being shocked (
JRC acknowledges the risk of physical harms to the skin, that “in rare cases, mild erythema of the skin may result” that disappears within an hour to a few days, “less than 1% of applications result in <1 mm lesion,” and “it is possible that repeat exposure to the GED skin-shock could result in blistering” (Refs. 21 and 73). With respect to psychological adverse effects, JRC states, “there also may be brief, temporary anxiety just prior to the delivery of the application as well as occasional harmless avoidance responses (
In line with the decades-old research that considered pain or discomfort to be merely an indicator of effective treatment (see section II.A.2), JRC does not include pain in its discussion of AEs caused by the device. Two tables provided by JRC in one of its submissions suggest its GED devices may not cause pain based solely on their peak current levels (Ref. 21). However, as discussed in section I.C, conclusions regarding pain based on peak current alone are difficult to draw, and the stimulus-pain matching tables in some of the sources cited by JRC are not based on shock sources akin to ESDs. JRC elsewhere acknowledges “the stimulation may be considered painful by some patients” (Ref. 73), and when asked directly whether the stimulus causes pain at the Panel Meeting, Dr. Nathan Blenkush, JRC's Director of Research, answered “yes.”
Except for the harms described earlier, JRC maintains that it “has not found any side effects associated with aversive conditioning” (Ref. 21) and “there are no confirmed reports or confirmed medical evidence that patients have any negative psychological side effects related to any discomfort experienced due to therapy with the proper use of the GED devices” (Ref. 73). FDA's review of records collected as part of a 2013 inspection of
However, with respect to psychological harms, JRC's records provide compelling evidence of risks of such harms that may result from GED use. For example, a JRC document entitled, “Procedures to Facilitate the Assessment of Possible Collateral Effects,” dated June 14, 2012, directs staff to note “any sign of any adverse effect on the student that may be resulting from the use of aversive interventions,” and “look for any collateral effects that may be related to the administration of an aversive intervention.” The collateral effects listed in the JRC document include, but are not limited to: Nightmares, intrusive thoughts, avoidance behaviors, marked startle responses, mistrust, depressions, flashbacks of panic and rage, anger, hypervigilance, and insensitivity to fatigue or pain. The corresponding section of the training manual headed “Responding to Collateral Effects” further directs staff to look for “signs of any form of distress or discomfort,” including but not limited to: Changes in sleep patterns, loss of appetite, confusion, irritability, lack of energy, sadness, mood swings, significant weight loss, loss of interest, fatigue and lack of energy, difficulty concentrating, agitation, restlessness, or irritability, withdrawal from usual activity, and feelings of helplessness. Another JRC document entitled “Pre-Service Training Manual,” dated September 11, 2012, contains the same information.
Although the patient records submitted by JRC do not indicate occurrences of any of these harms, and JRC's comments claim they adequately train their staff, monitor individuals on ESDs, and report adverse events, FDA has reason to doubt that none of these harms occurred. As discussed earlier, impairments with patient communication and provider recognition pose difficulties in identifying harms caused by the device, even for vigilant staff. State agencies in Massachusetts and New York have reported problems with staff supervision of individuals and monitoring of adverse events at JRC. For example, the 2006 NYSED review of JRC's program found that the collateral effects of punishment “are not adequately assessed, monitored, or addressed,” and “[t]here does not appear to be any measurement of, or treatment for, the possible collateral effects of punishment such as depression, anxiety, and/or social withdrawal.” Further, “[s]kin shock has the potential to increase the symptoms associated with PTSD, yet there is no evidence of data measuring these possible side effects or therapies designed to treat these symptoms” (Ref. 71). The 2007 Massachusetts DEEC investigation resulted in several determinations of deficiencies in patient oversight at one of JRC's residential facilities, including lack of necessary training and experience among staff, problems regarding communication of medical issues, monitoring staff neglect of responsibilities that “compromis[ed] the supervision and the safety of residents,” and staff failure “to monitor the residents in a manner that assured their health and safety” (Ref. 70). Given these findings, patient records may well fail to capture occurrences of harms.
Although three individuals formerly at JRC who spoke at the Panel Meeting either did not mention any harms or stated the GED did not harm them, two other individuals formerly at JRC described a variety of harms related to their experience with the GED, including panic and a fear of authority and being controlled, severe muscle cramps that would last 1 to 2 days, skin burn marks, terrible pain from the site of GED application on the leg down to the foot, loss of sensation in the leg and skin, frequent misfires, nightmares, freezing up upon hearing certain sounds associated with GED application, and flashbacks.
Three individuals formerly at JRC interviewed by FDA clinicians asserted the following additional serious AEs resulting from GED use: Heart palpitations, seizure, depression, and suicidality. These individuals described the GED shock as “a thousand bees stinging you in the same place for a few seconds,” a “bad bee sting,” and “extremely painful,” and gauged the pain level from 5 to 8, depending on the GED model and the location of the shock on the body.
Some of the relatives of individuals at JRC who spoke at the Panel Meeting only spoke about the positive effects of the GED devices and did not recount any adverse effects. Family members of individuals at JRC and a JRC parent association also commented that individuals at JRC have not suffered any side effects from the GED devices (see,
At the Panel Meeting, organizations concerned with the treatment and rights of individuals with disabilities cited risks of the following harms posed by ESDs based on first- or second-hand accounts: Pain, fear, anxiety, panic, depression, attempts to avoid or escape, nightmares, hyperarousal, flashbacks, burns, scars, loss of sensation, muscle contractions, learned-helplessness responses, nerve damage, muscle cramps, soreness, and neurological injuries such as seizures. The presenters stated that, in some cases, ESDs hindered the development of the very skills and behaviors necessary to control SIB or AB.
The written comments from disability rights organizations, as well as health care professionals and other concerned citizens, identified the following risks based on first- and second-hand accounts of the use of ESDs: PTSD and other effects on brain function from stress, including memory loss, loss of verbal communication, and sleep pattern disturbances; severe psychological trauma; depression with possible suicidal ideation; anxiety; increase in aggression; increase in escape behaviors and emotional reactions; fear and aversion or avoidance; seizures; migraine headaches; burns or red marks on the skin; loss of hair; loss of appetite; pain; misuse of the device (misfires and erroneous applications); persistent numbness and other neurological injuries; and ear problems.
One comment from a disability rights group cites a media report quoting an expert in a lawsuit filed by a parent of an individual formerly at JRC against JRC, describing the individual's state after he was shocked repeatedly with a GED device: “He was essentially in what we would call a catatonic condition . . . That means a condition that happens with people that are acutely psychotically disturbed” (Ref. 76).
Another comment from a psychologist, who has worked with patients exhibiting SIB and AB, reports witnessing patients waking up screaming from nightmares, which only happened after ESDs were used on them. The psychologist reported that other patients have “waking nightmares, in which horrible memories of shock, pain, and restraint suddenly overcome
Based on the scientific literature regarding ESDs for SIB, AB, and other unwanted behaviors, and regarding aversive conditioning generally, FDA has determined that ESDs for SIB and AB present the following risks: Depression; fear; escape and avoidance behaviors; panic; aggression; substitution of other behaviors such as freezing and catatonic sit-down; worsening of underlying symptoms, such as increased frequency and bursts of self-injury; pain; burns; tissue damage; and device misapplication or failure. Based on the scientific literature regarding ICDs, FDA has determined that ESDs for SIB and AB also present the risks of PTSD or acute stress disorder, shock stress reaction, and learned helplessness. This literature also provides support for the risks of depression, anxiety, fear, and pain.
Experts in the field of behavioral science and State agencies that regulate ESD use provide further support for the risks of depression, PTSD, learned helplessness, fear, anxiety, substitution of collateral behaviors, pain, burns, tissue damage, and inappropriate use. They indicate ESDs have been associated with the additional risks of short- and long-term trauma including suicidal ideation, chronic stress, acute stress disorder, neuropathy, heart palpitations, and trauma from falling. JRC's internal policies include long lists of risks for aversives they use. Although these are not specific to ESDs, FDA finds these lists further support that ESDs pose the risks of depression, fear, anxiety, panic, learned helplessness, and substitution of collateral behaviors, and they support that ESDs are associated with the additional risks of nightmares, flashbacks, hypervigilance, insensitivity to fatigue or pain, changes in sleep patterns, loss of interest, difficulty concentrating, and withdrawal from usual activity. Comments from individuals on whom ESDs have been used, their family members, disability rights groups, and others, provide additional support for the risks previously identified, and suggest ESDs may pose the additional risks of severe psychological trauma, catatonia, seizures, nerve damage, loss of sensation and numbness, migraine headaches, impaired brain function due to stress, memory loss, and muscle cramps.
FDA conducted an extensive, systematic review of the medical literature for information assessing the clinical benefits of the use of ESDs for SIB or AB. We identified a total of 45 studies, including 41 case reports or case series, a case-control study conducted outside the United States (Ref. 29), a within-subjects comparison trial conducted outside the United States (Ref. 78), a retrospective review of 60 patient charts (Ref. 30), and a questionnaire followup study of 22 subjects on whom ESDs were used for aversive conditioning (Ref. 79). (See table 3 of Ref. 3 for a summary of these 45 studies.) The 45 referenced studies showed that ESDs can have some immediate impact on the targeted behaviors in some patients,
We also evaluated 12 articles reviewing some of these 45 studies that included specific clinical information on individual subjects and examined the effectiveness of ESDs for various pathologies,
One review article specifically examined reports of applying ESDs to autistic children (Ref. 57). The authors noted that “in all of these studies, electric shock proved to be a highly effective therapeutic agent with autistic children.” They estimated that positive effects compared to negative effects occurred at a ratio of 5 to 1. However, they also reported that setting-specificity (the specific setting affects the results) may be an obstacle to an overall satisfactory effect (see also Ref. 44). Similarly, a comparison of different treatments for controlling behavior in individuals with intellectual impairments or schizophrenia noted that, in terms of immediate effects, “punishment was the quickest means of suppressing behavior” (Ref. 80; see also Ref. 36). These studies show that ESDs can interrupt SIB or AB, causing an immediate cessation of the behavior.
One study observed that a patient adapted to the stimulus intensity (Ref. 29), and another study showed that the application of ESDs can lead to adaptation (
Twenty-two of the 45 literature studies reported on durability of the effects of ESDs (Refs. 29, 30, 34, 36, 39, 40, 46, 50, 65, 79, and 81-92). A durable effect is one where an individual develops a conditioned response, so the target behavior, along with the numbers of shocks, is greatly reduced either while the individual continues to wear the ESD or after the ESD is removed. Twenty of the studies reported a durable effect that lasted from months to years. Two of the 22 studies reported no durability (Refs. 50 and 92). However, all 22 suffer from various flaws and limitations, as described in the next section.
Several of the literature reviews, which include reviews of many of these 45 studies, made observations regarding durability. One review opined that the use of ESDs might have long-term durability and concluded that results of aversive conditioning studies “suggest that sufficiently intense punishers . . . may produce lasting reductions in problem behavior” (Ref. 59). However, this conclusion included the qualifier, “as long as the punishment contingency remains in effect,” which implies that the authors were not discussing behavioral conditioning durability after the removal of the punisher. The authors also noted several limitations on the studies' findings. Importantly, the available studies had methodological limitations that prevent generalizing research findings to a treatment setting (Ref. 59). One major limitation is that, because of the long duration of the studies, unplanned changes or other uncontrolled conditions hinder attributing observations to ESDs. The authors concluded that, “[u]ntil additional research on long-term maintenance is conducted, practitioners and caregivers should not assume punishment will remain effective over the long run” (Ref. 59).
Other reviews were much more doubtful regarding the durability of ESD effects. One of the reviews discussed earlier in this subsection reported that,
The medical literature described in the previous section on the effect of ESDs on SIB and AB suffers from a number of deficiencies that limit confidence in the results. Most importantly, study design deficiencies render these studies inadequate to draw any definitive conclusions. As discussed in the previous section, 41 of the 45 studies that the Agency's analysis identified were case reports or series, which have limited evidentiary value in this patient population, as discussed in the paragraphs that follow. Another study was a retrospective analysis of patient charts (Ref. 30) that suffers from various flaws, discussed later in this section. Another study reported results from a questionnaire sent to 22 authors of case series publications, of whom only 11 responded (Ref. 79), used an unscientific sampling method (questionnaires were sent only to authors of published articles, some published more than 5 years prior), and asked questions that do not constitute validated measures of effects. The one prospective case-control study examining ESDs for SIB and AB (Ref. 29) only included 16 subjects (8 in the device group and 8 in the control group) and did not use a direct measure of SIB or AB as the primary outcome (instead, it measured a decrease in mechanical restraint). Finally, the within-subjects comparison study looked at heart rate changes as a measure of stress in five subjects, and it showed that active treatment with ESDs correlated to a statistically lower mean heart rate than when subjects were not wearing the ESD (Ref. 78). The authors surmised that heart rate was an indicator of stress but this correlation has not been demonstrated to be a valid marker of anxiety, and direct measures of reduction in SIB and AB were not taken. No randomized controlled trials directly examined ESDs for SIB or AB.
Generally, a study's strength or weakness is related to design in a number of ways, particularly through randomization, control, and the number of study subjects. Randomization distributes characteristics that could affect the results evenly across conditions. This equalizes the influence of nonspecific processes not under study,
In most cases, a study that is not randomized, controlled, inclusive of a sufficient number of subjects, or that suffers from more than one of these deficiencies, will yield weaker conclusions, and thus more uncertain predictions. Studies that fail to account for AEs will also yield weaker conclusions with respect to the benefit-risk profile, because such a study would not fully account for the risks.
In the case of ESDs used for SIB or AB, randomization, control, large numbers of subjects, and AE reporting are critical to understanding the benefit-risk profile. Many factors contribute to the manifestation or reduction of target behaviors and therefore can be significantly confounding. Those factors may include, but are not limited to, the underlying condition, environmental cues, transient psychological and physical states, and the treatment plan details. ESDs used for SIB or AB may also produce subtle outcomes, especially when the individual has intellectual or developmental disabilities that can impair communication. Subtle outcomes may include, but are not limited to, the development of stress disorders, fear and anxiety, pain and suffering, or learned helplessness. In light of such circumstances, drawing conclusions about the effectiveness of ESDs for SIB and AB, especially with respect to durable conditioning, is difficult in the absence of randomized controlled trials.
In a randomized controlled trial, the researcher will randomly assign each subject to one group, at least one of which is a control group. A randomized controlled trial is prospective; the researcher creates different conditions across groups at the outset and will observe outcomes in the future. The researcher will eventually compare the outcomes across groups, with the control group providing confidence that the researcher-set conditions were responsible for any differences. A randomized controlled trial is one of the best designs for strong conclusions in most cases, including the use of ESDs for SIB and AB. In reviewing all the evidence, FDA did not identify any randomized controlled trials studying the effects of ESDs for SIB or AB.
Other designs are often considered to provide weaker evidence, which is the case for ESDs used for SIB and AB. For example, a case-control study is usually considered to be weaker because it does not observe randomized subjects but, instead, retrospectively compares two types of subjects (one acting as the control) by observing different outcomes and working backwards to explain the cause of one set of outcomes. Retrospective reviews are often considered weaker still because they do not include a control group. Case reports or series are even weaker because they report on, and attempt to explain, the experiences of single individuals.
Conclusions drawn from these other designs are generally considered weaker because they do not rule out other causes for any differences in results, including subject selection bias, as effectively. Designs that take an outcome as given and then work backwards in an attempt to explain it are more vulnerable to bias than prospective designs. Single-subject designs such as case studies are less likely to yield outcomes that would be typical for other such subjects. The conclusions drawn from randomized controlled trials are therefore generally considered much more reliable than these other designs. The general rule applies to ESDs used for SIB or AB because of the known multiple confounding factors, possible subtle outcomes (including unassessed AEs), and because bias is of particular concern. Thus, the reliance on weaker study designs for trials on ESDs limits the conclusions that may be drawn regarding their effectiveness.
Other weaknesses stem from the fact that the majority of research articles
Some of the papers have significant methodological limitations in addition to those already discussed. For example, the 2008 review by Dr. Israel and colleagues (Ref. 30), which provides a retrospective analysis of 60 subjects purporting to show all achieved successful treatment (defined as at least a 90 percent reduction in the targeted behavior), failed to explain, among other standard disclosures, data collection procedures, whether it was retrospective or prospective, and why and how staff made certain decisions that differed from patient to patient (
A 2010 review by Dr. Israel and colleagues is a series of case reports on seven individuals at JRC (Ref. 94). The authors investigated the addition of punishment-based techniques to behavioral modification plans for people for whom positive-only techniques and pharmacotherapy had been reported to have failed previously, and reported success from skin-shock treatment at JRC. A review of case reports could be useful to examine initial results for continued investigations of an intervention; however, it was retrospective and covered few subjects. The authors also failed to describe how they chose the specific case reports, meaning that the authors may have overlooked or omitted individuals for whom punishment-based techniques did not affect the outcome. In contrast, studies that do not suffer from such methodological limitations have found that the removal of punishment techniques did not lead to an increase in problem behaviors (
A paper by Dr. van Oorsouw and Dr. Israel, et al. investigated the effects of GEDs, but it too suffered from significant limitations (Ref. 96). The authors claim that contingent shock (another term for aversive conditioning with ESDs) significantly improved some individuals' behaviors; however, in each of the categories measured, no more than four out of nine subjects demonstrated improvement. The other subjects “did not show any change.” Regarding measurements, the investigators apparently included “soft” neurological signs and symptoms, especially involuntary movements, which are common for individuals who exhibit SIB or AB. They apparently applied shocks for such involuntary movements even though the patients would not be able to consciously control those behaviors. The investigators also appeared to consider certain behaviors, such as refusing academic tasks, as target behaviors even though such behaviors are not clinically considered aggressive or self-injurious. Thus, the related results do not actually reflect the use of the devices for SIB or AB. Additionally, the investigators studied a small group with highly varied characteristics,
Further, the 2008 and 2010 reviews by Dr. Israel and colleagues were published in
FDA also identified conflicts of interest relevant to some of the articles. While possible conflicts of interest do not on their own discredit results, certain safeguards help maintain the credibility of the authors. Authors commonly disclose possible conflicts in their papers, allowing readers to consider the information accordingly, and authors do not normally decide whether to accept their own papers for publication. However, FDA has particular concern with the bias that may have influenced many of the papers about the effects of ESDs on SIB or AB. For example, Dr. Israel, the founder of JRC, was an author of several of the 45 articles; Dr. Blenkush, the facility's Director of Clinical Research, has co-authored several papers with him. At the time some of those papers were published in JOBA-OVTP, Dr. Israel was on the journal's editorial board and thus part of the reviewing and approving body. Considering the lack of peer review of these papers, any potential bias, intentional or not, in favor of the company or Dr. Israel's personal interests apparently went unquestioned before publication. In addition, without the expected conflict disclosures, readers were not adequately notified of any potential bias, which could affect their interpretation of the papers in consideration of the source.
The evidence in the scientific literature of the effects of ESDs on individuals' SIB or AB is therefore generally weak, and it is particularly weak with respect to the effectiveness of ESDs in achieving durable, long-term conditioning. This is not only because fewer studies considered long-term effectiveness, but more importantly, these studies failed to control for other treatment interventions applied over time, meaning that any effects observed may or may not have been due, in whole or in part, to ESDs. Thus, although the scientific literature indicates some individuals may stop engaging in the target behavior as an immediate effect of ESD application, the serious limitations discussed previously mean that durable long-term conditioning has not been established.
The Panel Meeting convened by FDA to consider the benefits and risks of ESDs generally held opinions consistent with our review of the literature. When asked whether the evidence presented at the Panel Meeting demonstrates that ESDs provide a benefit, the Panel was divided. However, approximately half the Panel agreed that there was a benefit, but they qualified their answers by explaining that the evidence showed a benefit from the interruption and immediate cessation of the target behavior. They noted the weaknesses in the evidence, including some of the limitations discussed previously. Three panelists were undecided, with one indicating that anecdotal reports suggest benefit for an ill-defined subpopulation. About one-third of the Panel answered no, the evidence does not show that ESDs provide a benefit to patients; they cited the poor quality of the evidence, the lack of recent data, and the failure to examine long-term effects.
At the Panel Meeting, one of the experts in the field observed that intervention with an aversive stimulus should not entail increasing the intensity, especially with ESDs, and that what might be characterized as adaptation or habituation to a particular
Pointing to evidence FDA has considered, Dr. Tristram Smith's expert opinion characterizes the results of the studies on aversive conditioning with electric shock as “highly favorable,” indicating that aversive conditioning reduces or eliminates severe SIB and aggression. As discussed in section II.A.3, he concludes that ESDs can be effective in at least some cases, but he is careful to note that the overall strength of the evidence is low (Ref. 8). Dr. Smith highlights many of the same evidentiary limitations discussed earlier, especially that the results may not be generalizable because they are based on small numbers of subjects and seldom provided information on key parameters, including recruitment, retention, standardization of measures, and participants' treatment history. Dr. Smith echoes the concerns discussed earlier that the ability to reproduce the studies' results in clinical practice is unclear because of differences between medical research and treatment settings, and notes that publication bias weighs in favor of reporting a clear effect on SIB and AB, since reports of clear effect are more likely to be published (Ref. 8). Finally, he observes that most of the few available studies have only evaluated short-term effectiveness and not long-term outcomes.
According to NYSED, in 2006 it promulgated regulations to prohibit future use of ESDs in public and private schools serving New York State students, and require review of each student who continued to receive a behavioral intervention with an aversive conditioning device by independent panels of three behavior experts. NYSED reports that, “in almost every instance over a 6-year period of time, these panels have determined after reviewing student-specific information that use of such a device was not warranted.” The panels “consistently reported that the data presented regarding the use of an aversive conditioning device lacked evidence of effectiveness.” NYSED also found that the long-term use of ESDs further demonstrates the lack of efficacy. Specifically, many students remain subject to ESDs for several years, and many continue to receive shocks long into their adult lives. In 2006, NYSED documented that 17 New York citizens remained subject to ESDs for 3 to 7 years (Ref. 72).
JRC asserts that its ESDs provide substantial benefits to individuals by causing a meaningful decrease in the aggression, self-injury, or other harmful behaviors they exhibit, and that the literature evidences more positive side effects than negative ones. JRC representatives have stated that they have observed multiple positive side effects: The individuals “are no longer a threat to themselves or others. They are happy, they are healthy, they are medication and restraint free, and for the first time in their lives they are learning.” In many individuals, JRC staff “see a dramatic improvement in the affect and the way that they present. Many of them are able to receive medical treatment that they wouldn't otherwise have been able to receive. They're able to enjoy time with their family.”
Regarding the effectiveness of the devices in conditioning patients' behavior, the JRC representatives stated at the Panel Meeting that, of 83 individuals whose treatment plans included use of the GED devices, 12 no longer wear the devices, 11 additional individuals have stopped using ESDs altogether, and 6 have not received any applications in the past 6 months. The representatives gave a detailed account of an individual who they claim was successfully treated with a GED device. In their view, banning ESDs would mean many individuals “are going to go back to the state of being restrained, of losing access to education, and are going to lose access to the vocational progress they have made, and they are going to return to a life of mechanical restraint and high doses of drugs.”
In its comments to the docket for the Panel Meeting, JRC submitted patient data purporting to demonstrate the durability of the effects of GED devices in reducing or eliminating SIB and AB. However, this evidence lacks key information and provides only weak support for the durable effectiveness of ESDs. Importantly, the ESDs were part of multi-element interventions and thus were not solely responsible, if at all, for any long-term changes in individuals' behavior. As section II.C.1 explains, multi-element treatment plans that do not involve the use of ESDs can be expected to result in durable effects (
Although JRC claims on its Web site that its devices are 100 percent effective (Ref. 98), at the Panel meeting JRC's Director of Research acknowledged, “The GED and skin shock is not 100% effective for everybody . . . there are cases in the literature that show that some people it doesn't work for.” He acknowledged that sometimes patients adapt to ESD shocks:
[O]ne of the things that happens sometimes when you use these types of devices is that there's a phenomenon of adaptation, which means that the skin shock device no longer functions as a punisher and the behaviors return. And that comes from using it over and over again, and the frequency of the behaviors accelerates and it no longer functions as a punisher, it no longer controls the behaviors. So when that happens, then you move—one of the things you can do is move to higher levels of stimulation . . . [W]hat JRC found in the '90s was that if you start off at a level of 15, then you're less likely to encounter that adaptation. And then we've also found that, in the rare cases where there is adaptation to the GED, we can move to the GED-4 and we generally don't see adaptation at all after that.
At the Panel Meeting, a member of a JRC parent association explained that her child's treatments were not successful until they tried JRC's GED device. The speaker thought that the skin shock quickly and effectively targeted specific behaviors while other treatments did not stop dangerous or self-abusive actions. The three individuals formerly at JRC who expressed their opposition to a ban at the Panel Meeting described their severe behavior issues and the failures of alternative treatments. They described successful outcomes after application of GED devices at JRC, and they described how they are now independent, well-
One of the parents' associations submitted a comment that included 32 letters from family members of individuals at JRC reporting success stories for the GED devices. One letter includes seven case reports of individuals said to have been successfully treated at JRC with ESDs. The letters contend ESDs were the only successful treatment for their family members. They describe the individuals' severe behaviors prior to GED use, some life-threatening, including eye-gouging, suicidality, depression, swallowing sharp objects, cutting wrists, biting themselves, head-banging, hitting themselves with hard objects, running into walls, jumping out of windows, scrotal tearing, rumination, and projectile vomiting. The family members describe how previous treatments failed, leading many schools to reject or expel the individuals; in contrast, they described successful treatment with ESDs at JRC.
One speaker at the Panel Meeting, who described himself as a doctor who worked in the field for over 25 years, said that he had published peer-reviewed articles on both positive behavior support and punishment technologies. He opposes a ban “in the spirit of the right to effective treatment.” He believes that for some individuals, “primary salient punishment is what's necessary in order to compete with their repertoires.”
Several of the written comments we received from disability rights advocates assert that ESDs provide little if any benefit, and they criticize the scientific integrity of some of the sources cited by JRC in support of effectiveness. One comment from an advocate concludes that “the existing literature demonstrates only that electric shock aversives have inconsistent short-term efficacy with absolutely no long-term efficacy in reducing or eliminating destructive and self-injurious behaviors.” The comment criticizes the evidence relied upon by JRC to support effectiveness as “published internally with the sole involvement of their own personnel or those closely connected to their facility with no meaningful external review.” For example, the comment states that JRC's Web site represents a self-published followup study on 65 individuals at JRC as data-based research, yet no related paper was accepted for peer review and there is no explanation or context for the methods of data collection.
Our search of the scientific literature regarding the effect of ESDs on SIB and AB revealed a number of studies showing that ESDs result in the immediate interruption of the target behavior upon shock, and some of the literature also suggested varying degrees of durable conditioning. However, these studies suffer from serious limitations, including weak study design, small size, and adherence to outdated standards for study conduct and reporting. Also, the conclusions of several of the studies are undermined by study-specific methodological limitations, lack of peer review, and author conflicts of interest. There is also evidence that the shocks are completely ineffectual for certain individuals. FDA has determined that the evidence shows that ESD shocks generally interrupt and cause immediate cessation of the target behavior when applied at the onset of such behavior, but the evidence is otherwise inconclusive and does not establish that ESDs improve the underlying condition or successfully condition individuals to achieve durable long-term reduction of SIB or AB.
FDA considers the reasonableness of the risks of ESDs relative to the state of the art,
In our systematic review of the scientific literature, FDA found that the weight of the evidence indicates the state of the art for the treatment of SIB or AB relies on multi-element positive methods, especially positive behavioral support (PBS), sometimes in conjunction with pharmacological treatments, and has evolved away from the use of ESDs. The first published studies of contingent skin shock (the stimulus delivered by an ESD) took place in the 1960s (see Ref. 3, summarizing published research). Since then, advances in science and medicine have led to a better understanding of the environmental triggers and organic origins of SIB and AB, improved behavior analysis methodology, and heightened ethical and human rights concerns regarding the use of ESDs, particularly in vulnerable patient populations (
Positive-intervention treatments incorporate the scientific and medical developments of recent decades as their foundation. For example, researchers have learned that behavioral treatment strategies should account for emotions and self-invalidation (rejecting the validity of one's own thoughts or emotions), which can be underlying factors associated with challenging behaviors (
The key to creating a plan to address these cues and processes was the development of a formalized analysis, called a functional behavioral assessment (Ref. 106). Such an assessment is an analytical tool that facilitates various methods of applied behavioral analysis (ABA), which tailors treatment to the specific patient, particularly with respect to preventive measures. ABA is a fairly large family of treatment models that has existed as a general category for several decades. Although different authors define its scope differently, and older ABA models included aversives, in reviewing
To design the intervention, clinicians first conduct a comprehensive functional behavioral assessment to identify the target behaviors and the environmental and social triggers that contribute to them. This includes identifying the frequency of the unwanted behaviors as well as the social context and other environmental conditions (
One particular type of positive behavioral therapy discussed in the literature is PBS. PBS uses functional behavioral assessment to develop a treatment strategy geared toward teaching new behaviors (Refs. 59, 99, and 108). These new behaviors proactively displace undesirable behaviors such as SIB and AB by teaching patients to express themselves with behavioral substitutions that will not cause harm to themselves or others. Functional communication training is one such approach. This process examines the communicative intent of the problem behaviors (what the individual is trying to tell or obtain from others), and then focuses on teaching the individual a functionally equivalent, but non-problematic, behavior (Ref. 107; see also Ref. 104). Several studies have demonstrated the value of functional communication training, especially when included as part of a comprehensive, multi-element intervention such as PBS (see Ref. 109 for a review of 29 studies).
PBS also relies on reinforcing desired behaviors, altering the environment to prevent or avoid triggers, and is explicitly nonpunitive. Thus, PBS treatments exclude physical aversive conditioning techniques, which react to self-injurious or aggressive behavior rather than prevent such behavior from occurring in the first place, and can often lead to the escalation of the same events they are trying to prevent (Refs. 97, 99, and 101). Although proactive in nature, PBS plans may include rapid-reaction strategies for potentially serious problem behaviors that might pose a risk of harm to the subject or others to reduce the severity of an episode of problem behavior (Ref. 97). In contrast to a punishment technique, such plans are not intended to condition the individual or provide behavioral reinforcement.
Another more recently developed positive-based behavioral therapy for SIB and AB is dialectical behavioral therapy (DBT). Like PBS, DBT grew out of ABA principles (Ref. 105). DBT is a cognitive behavioral treatment that was originally developed to treat chronically suicidal individuals diagnosed with borderline personality disorder, and it is now recognized as a standard psychological treatment for this population (Ref. 110). Research has shown that it is also successful in treating a wide range of other disorders such as substance dependence, depression, PTSD, and eating disorders.
DBT consists of four components: A skills training group, individual treatment, DBT phone coaching, and a DBT therapist consultation team. Similar to PBS, DBT is a multi-element, empirical approach to treatment that relies on a behavioral analysis and emphasizes empathy, acceptance, and collaboration (Refs. 105 and 111). In both therapies, the goal is to impart new skills such as mindfulness, distress tolerance, interpersonal effectiveness, and emotion regulation (Refs. 105 and 111). However, because DBT was developed to treat certain conditions that may give rise to SIB and AB, such as borderline personality disorder, it differs subtly from PBS and centers on treating emotional dysregulation (Refs. 105 and 111). Thus, even though two patients may manifest SIB, DBT may be suited to treat one more than the other, depending on the underlying condition (Ref. 105).
Despite the apparent convenience, researchers have long raised ethical concerns about purposefully subjecting patients to the harms caused by physically aversive stimuli (Refs. 36 and 103). Patients subject to ESDs “gave every sign of fear and apprehension” associated with pain and anxiety (Ref. 36), yet decades ago, there was little oversight by human rights or behavior committees (Ref. 112). Indeed, experiments in punishment contributed to the development of behavior committees, and eventually the modern institutional review boards that are now mandatory for human research. As discussed in section II.A.1, patients may adapt to a particular shock level, which may lead to stronger shocks, thereby escalating ethical concerns (Ref. 59). Given the ethical implications, experts were cautioning as early as 1990 against allowing a crisis intervention procedure to turn into a continuous management technique (Ref. 103).
Whereas ethical and human rights concerns related to the risks posed by aversive techniques, especially ESDs, were drivers of the movement in the medical community away from these techniques (Refs. 106 and 112), the rise of positive behavioral interventions appears to be attributable to their success in treating problem behaviors while posing little to no risk. The literature supports a finding that newer, positive treatment approaches that are not combined with any aversive techniques are equally successful as approaches that use both positive and aversive techniques, regardless of the problem behavior targeted (Ref. 113). Indeed, providers and researchers have found that PBS is successful in the treatment of even the most challenging behaviors (Refs. 97 and 101), including in community and home settings (Refs. 95, 114, and 115). A review of 12 outcome studies for multi-element positive interventions, for a total of 423 patients, also concluded that PBS appears to be successful for the most challenging behaviors (Ref. 97). Similarly, randomized controlled trials have demonstrated that DBT successfully reduces self-injury in patients with borderline personality
PBS is also more adaptable than aversive conditioning techniques because it can achieve durable results for patients for whom aversive conditioning cannot. In particular, a consequential strategy such as aversive conditioning cannot achieve behavioral conditioning for some patients who have conditions that impair their ability to understand consequences and react by changing their behaviors. For example, a patient exhibiting SIB or AB may have severely impaired short-term memory and impulse control such that that any consequential strategy (like ESD shocks delivered in consequence of exhibiting a target behavior) may be limited in what it can accomplish (Ref. 97). Since PBS relies on preemptively identifying and reducing the problem behaviors' triggers, proactively reducing the problem behavior and not reactively relying on consequences, it has an inherent advantage over aversive conditioning techniques for such patients (Ref. 97).
The adaptability of PBS is also intentional, resulting from providers' efforts to translate positive treatment outcomes that were demonstrated in clinical settings (inpatient treatment facilities) to community settings (Refs. 99 and 106). The relatively little basic clinical research on contingent shocks (shocks given in response to certain behaviors), such as those applied by an ESD, is difficult to translate into treatment plans because aversive conditioning-based techniques, including the application of ESDs, are context-sensitive and may not remain effectual in different physical environments, from different providers, or for different patients (Refs. 36, 44, 59, and 93). Further, as discussed in section II.B.2, the available evidence does not demonstrate that aversive conditioning-based techniques provide durable long-term effectiveness (Refs. 34, 36, 59, and 95). In contrast to continual application of physical aversive conditioning techniques to suppress problem behaviors, PBS can achieve durable, successful treatment in community and home settings by targeting the underlying causes of the behavior and imparting the skills needed to address it (Refs. 99 and 106).
Like PBS, DBT is adaptable and has been shown to be successful in individuals with intellectual disabilities, in particular in reducing the severe SIB or AB of such individuals (Ref. 105). DBT also appears to achieve durable results after in-patient treatment (Ref. 117), and recent research suggests that, for some people, DBT approaches can effectively treat SIB on an outpatient basis (Ref. 116).
The only risk FDA found to be associated with positive behavioral treatments is one posed by “extinction,” a common, integral component of behavioral plans (Refs. 118 and 119). An extinction process reduces a target behavior by withholding the reinforcer,
Not all treatment providers follow a positive-only behavioral treatment model such as PBS (Refs. 113 and 115). As explained in section II.B.1, FDA's review of the available data and information did reveal that aversive conditioning techniques may provide some effect of immediate cessation (
The comments submitted by JRC question the effectiveness of positive behavioral interventions, citing three case review studies of “positive-only” approaches covering successive time periods. In JRC's characterization, a study covering 1969 to 1988 found a success rate of 37 percent for such an approach (Ref. 121), one covering 1985 to 1996 found a 52 percent success rate (Ref. 99), and the third, covering 1996 to 2000, found a 60 percent success rate (Ref. 122). JRC also cites a literature review to support its claim that positive-only interventions sometimes require supplementation with punishment techniques (Ref. 123).
These studies do not alter FDA's conclusions regarding the effectiveness of positive behavioral interventions or the state of the art for the treatment of SIB and AB. We note that the first review cited by JRC (Ref. 121) includes comparative assessments of positive-only approaches showing that, for the category of behaviors referred to by JRC (positive-only approaches targeting SIB), skills acquisition and stimulus-based interventions had 50 and 52 percent success rates, respectively, during the reviewed time period. FDA recognizes that positive behavioral interventions may not always be successful on their own for all problem behaviors in all patients. However, we note the substantial progress in non-aversive approaches for the treatment of SIB and AB as providers have gained experience with them over time, which is evident in the increasing success rates cited in JRC's comment.
Further, one review cited by JRC (Ref. 123) studied the addition of punishment procedures generally and did not address the use of ESDs in particular. Punishment procedures can take a wide variety of forms in addition to ESDs, such as daily point deductions, verbal reprimands, or food deprivation. Although the authors concluded that aversives appeared to improve some patients' outcomes, they did not conclude ESDs were a necessary aversive, and the intervening years have yielded even more favorable results for positive-only approaches (Ref. 97).
Review of the current scientific literature confirms that, in recent decades, medical practice has shifted away from restrictive physical aversive conditioning techniques such as ESDs and toward treating patients with SIB and AB with positive-based behavioral interventions (Ref. 113). PBS emerged beginning in the 1980s (Refs. 97, 106, and 112), and continued to develop in the ensuing years, emphasizing empirical analysis and applicability to non-clinical settings (Ref. 106). One analysis showed that, beginning in the 1990s, the use of positive techniques increased while the use of punishment techniques, which include physical aversives, dropped (Ref. 124). A survey of experts in the related fields of PBS and ABA found that the largest dropoff in usage of punishment techniques occurred between the 1980s and 1990s (Ref. 112). Such surveys show the ABA field as a whole moved away from intrusive physical aversive conditioning techniques such as ESDs 2 decades ago (Refs. 103 (reprinted from 1990) and 112).
Correspondingly, many authors have noted that research of punishment-based techniques—which includes a broad range of consequences, from the
SIB and AB are seen in patients with a variety of diagnoses, including autistic disorder, Fragile X syndrome, Lesch-Nyhan syndrome, and other developmental disorders. There are currently two drugs that have been approved by FDA for the treatment of irritability associated with autistic disorder in children, a population representing a small subset of all patients with SIB and AB. RISPERDAL (risperidone) was approved in 2006 for the treatment of irritability associated with autistic disorder based on clinical trials in patients ages 5 to 17 years old, and ABILIFY (aripiprazole) was approved in 2009 for the same indication based on clinical trials in patients ages 6 to 17 years old. In the trials conducted for approval, SIB and AB were among the emotional and behavioral symptoms of autism that were measured in the overall evaluation of irritability.
The most common adverse reactions observed in the trials conducted for approval of these two drugs were sedation, increased appetite, fatigue, constipation, vomiting, and drooling. Other serious adverse reactions with the use of these drugs may include neuroleptic malignant syndrome, tardive dyskinesia, and metabolic changes.
Published literature describes the clinical use of pharmacotherapy for the treatment of SIB and AB, which includes the use of atypical antipsychotics such as risperidone and aripiprazole as well as drugs from other pharmacological classes. (See Ref. 3 for a review of relevant literature examining the use of pharmacotherapeutic interventions in the treatment of SIB and AB.) Reports describing the use of certain atypical antipsychotic drugs (
FDA asked the Panel whether treatment options other than ESDs, including behavioral, pharmacological, alternative, and experimental therapies, are adequate to address SIB or AB. Most of the Panel opined that other treatments are not adequate for all individuals who exhibit SIB or AB, citing a lack of sufficient data demonstrating efficacy, especially when evaluating the durability of benefits, drug side effects, and that “it's unfortunately rare that any treatments in psychiatric or behavioral issues are universally effective.” FDA also asked the Panel whether a specific subpopulation of patients exhibiting SIB or AB exists for whom pharmacological and behavioral treatment options other than ESDs are inadequate. The panel unanimously concluded that such a subpopulation seems to exist but is very difficult to define and recommended additional research into refractory subpopulations.
Based on the available data and information, FDA is not aware of any recognized clinical criteria to identify refractory patients. We could not find rigorous or systematically collected data that distinguish a refractory subpopulation that does not respond to other available treatments. Even assuming a subpopulation exists for which treatments other than ESDs are not adequately effective, that does not mean ESDs are effective for that subpopulation. As with other psychological or neurological conditions, there may simply be a subpopulation of patients for whom there is no adequate treatment option. As discussed previously, although some evidence suggests ESDs reduce SIB and AB in some patients, no randomized controlled clinical trials have been conducted to demonstrate effectiveness generally or that ESDs are effective for behavioral conditioning when other options fail.
Accordingly, the Agency agrees with the observation made by one of the Panel experts: Although other treatments may not completely reduce or eliminate SIB or AB in all patients, that does not mean ESDs should be used. In determining whether to ban these devices, FDA balances effectiveness against the risks they pose and assesses the reasonableness of such risks in light of the state of the art. The state of the art is to use positive behavioral interventions, sometimes in conjunction with pharmacotherapy, even for the most challenging SIB and AB; the unsubstantiated claim that ESDs are uniquely effective for refractory individuals does not alter that conclusion. As the Panel expert cited previously explained, “the statements of professional programs and the fact of wholesale abandonment of aversive electrical shock therapy by the peers in this field show that it is unreasonable to conclude that these devices are part of the standard of care for this class of patients . . . ”.
Epitomizing the decades-long shift away from ESDs, one of the device's pioneers has publicly repudiated contingent shock for its lack of effectiveness (see Ref. 125). Another expert summarized in an interview that the modern clinical approach is the result of science establishing better methods, compared to ESDs, for the treatment of severe problem behaviors (see Ref. 126), and another expert repudiated behavioral treatments that use punishment techniques more broadly as early as 1989 (see Ref. 107 for a summary).
FDA also considered information and opinions on state-of-the-art treatment for SIB and AB in the expert reports it obtained. Dr. Smith's opinion notes similar trends that FDA has identified regarding the development of positive interventions for SIB and AB based on a functional behavioral assessment, which allows the customization of a treatment plan to meet the individual's needs. In his view, the data do not support a precise estimate for success rates of positive interventions in patients exhibiting SIB or AB, but he notes the rapid increase in reported effectiveness, from a 1990 review that
Dr. Brown's report provides additional detail on the development of the PBS field. She believes 20 years of empirical evidence demonstrate that plans designed around a functional behavioral assessment can effectively address even the most serious problem behaviors. She contrasts this evidence base with that for contingent skin shock, for which she identifies a sharp decline beginning in the 1990s. In her view, dated research on contingent skin shock is not particularly relevant to current perspectives on people with disabilities, especially given that such research does not meet modern standards for study conduct or comport with the current medical understanding of serious psychological disorders.
One of the developments that Dr. Brown highlights is the understanding that the “[r]eduction of problem behavior is an important, but not the sole, outcome of successful interventions” (Ref. 107). Instead, an effective PBS intervention will enhance quality of life, acquisition of valued skills, and access to valued activities (Ref. 107; see also Refs. 127-129).
Dr. Brown also contrasted the amount and availability of publication and training between PBS and contingent skin shock. In particular, several books and peer-reviewed journals focus specifically on PBS, and graduate training programs and organizations foster the competent development and implementation of PBS. In contrast, to her knowledge, “no journals, books, graduate programs, or organizations focus [ ] on the skills necessary to use contingent electric shock or other aversive interventions” (Ref. 107).
Dr. Brown further points out that while no professional organization publishes standards of practices for the use of ESDs, the Association for Positive Behavior Supports has adopted standards of practice for the elements that comprise PBS (Ref. 107).
Similar to Dr. Brown's conclusions, Dr. LaVigna's expert report also emphasizes that a positive-only treatment plan developed according to specific guidelines will adequately address even the most challenging behaviors, regardless of the individual's diagnosis or functioning level (Ref. 130). He separates possible elements of a PBS plan into four categories: (1) Ecological strategies, which address a mismatch between the individual's needs and the environment; (2) positive programming strategies, which teach new skills with specific instructional methods; (3) focused support strategies, which reduce or eliminate the behavior primarily through antecedent control; and (4) reactive strategies, which, unlike a punishment-based method, are intended only to reduce the immediate behavior (Ref. 130).
Dr. LaVigna elaborates on the relatively recent development of a new outcome measure and principles to define challenging behaviors, including episodic severity as well as the principles of resolution and escalation (Ref. 130). Episodic severity allows a provider to account for more than the frequency of the target behavior by adding data about how severe the particular occurrence was (Ref. 130). In this way, progress can be measured more completely by including a reduction in severity, rather than merely looking at the number of occurrences. The principles of resolution and escalation allow a provider to categorize outcomes of interventions, which means they “can explicitly take responsibility” for strategies to achieve reductions in episodic severity (resolution) rather than increases in severity (escalation) (Ref. 130).
With the advent of PBS, along with refinements such as improved outcome measures and definitions, Dr. LaVigna points to recent literature that studied over 500 patients and found that PBS was effective (Ref. 130). He also recounts an example of a patient for whom ESDs had been recommended, observing that correctly implemented positive-only methods were able to treat the patient instead (Ref. 130). He asserts that, not only is PBS highly effective even for the most challenging behaviors, but that it can be implemented in community and institutional settings cost effectively and accessibly (Ref. 130). He concludes that “[p]unishment is unnecessary, and is not the accepted standard of care in the relevant treatment community” (Ref. 130).
The limited and generally outdated evidence base supporting the use of ESDs contrasts markedly with the extensive, current, and growing evidence base for PBS. While ESD use is founded upon research that incorporates outmoded assumptions and in practice has often sought compliance with staff-determined norms rather than focusing on clinically relevant behaviors, PBS reflects modern medical advancements and emphasizes patient choice, participation, and skills acquisition, even for patients with the most challenging behaviors. PBS enjoys thriving academic support and PBS practitioners can refer to practice guidelines published by a professional organization, while academic interest in aversive conditioning has languished and the use of ESDs is not contemplated in a comparable publication.
FDA considered the actions of States with respect to ESDs and aversive interventions generally, and we found that many already prohibit the use of these devices. In 2011, the Massachusetts Department of Developmental Services (DDS) proposed regulations to prohibit the use of contingent skin shock on individuals other than those who have an existing court-approved treatment plan that includes the use of such devices as of September 1, 2011.
These State laws prohibiting or restricting the use of ESDs provide further support that these devices are
In fact, the Massachusetts DDS has successfully transitioned several patients who were subject to ESDs at JRC to providers who do not use ESDs (Ref. 132; see also Ref. 95). FDA agrees with the assessment of the current standard of care by the Massachusetts DDS:
The Department concludes that there has been an evolution in the treatment of severe behavioral disturbances in persons with intellectual disability over the past thirty years, and particularly in the last two decades, which has moved towards forms of treatment that are non-aversive and involve positive behavioral supports.
The Department bases this opinion both on the body of empirical evidence showing the effectiveness of other less intrusive forms of treatment that do not involve pain; on the overwhelming support of this position by virtually every local, statewide or national organization supporting individuals with intellectual disability, and by providers and clinicians whose practice demonstrates that non-aversive treatment can modify difficult or dangerous behaviors effectively and for the long-term, while aversive interventions, in addition to causing pain and anxiety in such individuals, have no proven long-term efficacy.
Evidence from other States further corroborates our conclusions. For example, as discussed earlier, according to NYSED, following promulgation of regulations in 2006 by NYSED prohibiting future introduction of ESDs in public and private schools and requiring review of students then subject to ESDs, independent panels of behavior experts determined that ESDs were not warranted in almost every instance over a 6-year period. Similarly, at the Panel Meeting, the Assistant Attorney General for the State of Utah, representing his State's agencies that provide services and protection for individuals with disabilities, observed that programs in Utah and across the nation effectively treat SIB and AB without ESDs.
At the Panel Meeting, the presenters for the manufacturer stated that the data demonstrate a clear clinical need for these devices. In their view, therapy for these individuals has failed at all other treatment centers, and other treatments have failed at JRC prior to the utilization of their GED devices. They asserted that a wide range of therapeutic interventions over long periods of time have been ineffective for their residents on GED devices, and that typically 12 to 15 other facilities have expelled or rejected these residents before they come to JRC. They stated that the individuals on whom ESDs are used are those with extraordinary behavior disorders. JRC's position is that few other treatment facilities, if any, will accept patients who have not improved without aversives, and that the only other options besides ESDs would be psychotropic drugs and various restraints (Ref. 21).
FDA has found no basis to believe that the patients on whom ESDs are used at JRC are patients with the most severe SIB and AB in the United States. FDA also has reason to doubt whether all alternatives were adequately attempted before resorting to ESDs. As noted in section II.C.5, we are aware that some parents have reported that JRC did not attempt positive approaches based on functional behavioral assessments, and the parents felt pressured into accepting the necessity of ESDs (Ref. 133). Similar to the NYSED review discussed in sections II.A.4 and II.B.4, another review revealed that the facility using ESDs for SIB and AB either did not conduct a functional behavioral assessment or did so in a non-standard way, which could reduce the effectiveness of the resulting behavioral intervention (Ref. 107). Although there is anecdotal evidence that treatments other than ESDs were tried on individuals at JRC and failed prior to use of ESDs, there is evidence in the literature that patients have been successfully treated with alternatives after ESDs were used (Ref. 95).
Further, evidence of failures of treatments other than ESDs is not evidence that ESDs safely or successfully treat patients or are within the state of the art. To cope with patients' apparent adaptation, the manufacturer itself acknowledges that increasing the electric current may be necessary, and if that does not work, the ESD may need to be replaced with “an alternative behavior program” (Ref. 21). In fact, consistent with our understanding of the state of the art, JRC touts positive behavioral therapies, for example on the “Unparalleled Positive Programing” page on its Web site, but its Web site does not even mention its use of ESDs (Refs. 134 and 135).
The comments submitted by JRC question the effectiveness of positive behavioral interventions based on its belief that there does not appear to be any clinical data supporting such, an absence of research concluding that “all problem behaviors can be effectively treated using only PBS procedures,” and “literature stating that PBS is not always effective for self-injurious behaviors.” The comment from a former JRC clinician also asserts that PBS and medications are not effective for all individuals with serious behavior disorders.
Contrary to JRCs assertion, there are clinical data supporting the effectiveness of positive behavioral interventions such as PBS and DBT in treating SIB and AB, as discussed earlier in this section. Further, even though positive behavioral interventions may not always be successful on their own for all problem behaviors in all patients, this does not mean they are not generally effective, sometimes used in conjunction with pharmacotherapy, or that they are not state-of-the-art treatments for SIB and AB. Rather, the literature provides evidence showing that multi-element positive interventions are at least as successful as methods that include use of aversives regardless of the behavior targeted, as discussed earlier in this section.
JRC also submitted a paper by Dr. Blenkush, the Director of Clinical Research at JRC, purporting to show that ESDs have a more favorable side effect profile than antipsychotic medications (Ref. 21). FDA notes that no peer-reviewed literature compares treatment regimens. Further, the JRC paper makes comparisons that may not be relevant to the selection of treatment for an individual. For example, the paper compares frequency of specific side effects from pharmacotherapy to the frequency of different categories of side effects from ESDs. However, aggregate frequency data on dissimilar effects across different patient populations provide scant basis for a comparison of treatment regimens. Comparing a comprehensive list of the side effects of several antipsychotic medications against the side effects of a single device, which the paper admits “have not been evaluated in the same depth or
The comment from a former JRC clinician asserts the standard of care for treatment resistant individuals such as those at JRC includes consideration of aversive conditioning devices such as the GED, citing a textbook that discusses punishment techniques including the use of ESDs.
The three former JRC residents who opposed a ban at the Panel Meeting described their severe behavior issues and the failures of alternative treatments (psychotropic medications, physical restraints, and reward systems). One stated that the drugs made him feel like “a walking zombie.” Comments from family members of JRC residents similarly describe numerous failed alternative treatment attempts prior to finding success with ESDs at JRC. Many family members report that the side effects of drugs are much worse than ESDs and included: Extreme sedation, not recognizing or interacting with others, bizarre behavior, toxicity effects (such as damage to internal organs), loss of personality, and lack of learning. One parent listed 26 drugs her child had tried and other treatments that failed, including electroconvulsive therapy (which is different from ESD application and not the subject of this proposed rule). One mother noted that the behavior medications interacted with her child's seizure medications and caused an increase in seizures.
FDA understands that family members of individuals exhibiting SIB or AB face very difficult choices regarding treatment options, and FDA does not doubt their best intentions, the sincerity of their belief that an ESD is the best or perhaps only option for their loved one, or that they have tried alternative treatments without success. However, FDA does have reason to question the information provided to these family members by JRC. One article reports that some parents who consented to the use of GEDs on their children did so only under pressure (Ref. 133). These parents reported feelings of coercion upon admission to the facility and intimidation when attempting to change their children's intervention plans (Ref. 133).
Although the facility touts itself as accepting refractory patients, all of the parents interviewed provided information suggesting that interventions in public schools prior to JRC admission did not attempt all treatment options, such as using a functional behavioral assessment to develop prevention or antecedent strategies (Ref. 133). Once at JRC, none of the parents reported the development of prevention or antecedent strategies for their children (Ref. 133). Given that functional behavioral assessments, as well as prevention and antecedent strategies such as those in a positive multi-element intervention, are generally successful even for challenging SIB and AB, such patients may well have been responsive to PBS techniques had they been attempted.
FDA acknowledges that these reports are only from certain parents who volunteered to share negative experiences, and we cannot conclude that these reported experiences were shared by others or are generally representative of families' experiences at JRC. Nevertheless, the reports do indicate that at least some parents felt pressured by JRC to continue to agree to the use of GEDs on their children, and for at least some children, alternative treatments were not exhausted. For them, GEDs were not in fact applied as a last resort.
Information from other Federal agencies, behavioral psychologists, disability rights groups, and the United Nations corroborates FDA's conclusions regarding the risks of ESDs relative to the state of the art. For example, in its comment, the U.S. Department of Justice (DOJ) explained that it has concluded that ESDs are outside the generally accepted standard of care (Ref. 136). DOJ enforces the Civil Rights of Institutionalized Persons Act (42 U.S.C. 1997
Behavioral psychologists who have practiced for decades treating patients with SIB and AB indicated in comments on the Massachusetts ban that they have not had to resort to aversives such as ESDs, describing painful aversives as “unnecessary, unacceptable, and not supported by the professional literature” (Refs. 137 and 138). Another commenter on the Massachusetts ban stated that in 30 years working in programs serving individuals with severe behavior challenges and dangerous behavior in more than 20 States, no program allowed use of pain to control behavior (Ref. 131). At the Panel Meeting, disability rights groups' presentations concurred that positive behavioral interventions have been shown to result in long-term reduction or elimination of challenging self-injurious or aggressive behaviors.
Finally, the United Nations Special Rapporteur on torture and other cruel, inhuman, or degrading treatment or punishment, has determined that the application of ESDs violates the rights of individuals at JRC under the United Nations Convention Against Torture, as well as other international standards, and supports a complete ban on “electroshock procedures.” Although the United Nations is composed of many countries in addition to the United States, the fact that this multi-nation body does not merely consider ESDs to be inappropriate or unacceptable treatment, but considers them to constitute torture, suggests that there is great distance between these devices and state of the art for treatment of SIB and AB. Although JRC claims ESDs are used for SIB and AB in other
FDA has determined, on the basis of all available data and information, that state-of-the-art treatments for SIB and AB are positive-based behavioral approaches, sometimes alongside pharmacotherapy, as appropriate, and do not include ESDs. We focused on data in the scientific literature, current clinical practices, and information about the evolution of treatments for SIB and AB.
Significant scientific advances have yielded new insights into the organic causes and external triggers of SIB and AB. Although researchers have much yet to learn, the advent of functional behavioral assessment, and, subsequently, approaches like PBS and DBT, have allowed providers to move beyond aversive conditioning techniques such as the contingent shocks delivered by ESDs. The state of the art represents the achievements of an empirical response to the inadequacies of such techniques from both a safety and effectiveness standpoint. The scientific community has long recognized that addressing the underlying causes of SIB or AB, rather than suppressing it with painful shocks, not only avoids the risks posed by ESDs, but can achieve durable, long-term benefits.
As a result, the use of aversive conditioning techniques overall, and ESDs in particular, has diminished considerably over the past several decades, while the use of positive behavioral methods has risen. The overwhelming majority of remaining providers who employ some type of aversive conditioning use methods that are much less intrusive than contingent shock. ESDs are only used at one facility in the United States on individuals from a small number of States; almost half of the States have specifically prohibited their use. Practitioners in the field with decades of experience have asserted that they have never had to resort to ESDs, and surveys of experts show that such views are common. Meanwhile, modern positive behavioral treatments have been demonstrated to work in complex environments like community settings and achieve durable results while posing very little risk (Refs. 99, 101, and 106). Although positive behavioral interventions such as PBS may not always be completely successful on their own for all behaviors in all patients, the literature indicates that they are generally successful, sometimes alongside pharmacotherapy, regardless of the severity of the behavior targeted, and the success rates continue to improve.
As discussed in section I.F, section 516 of the FD&C Act authorizes FDA to ban a device intended for human use by regulation if it finds, on the basis of all available data and information, that such a device presents substantial deception or an unreasonable and substantial risk of illness or injury.
In determining whether a deception or risk of illness or injury is “substantial,” FDA will consider whether the risk posed by the continued marketing of the device, or continued marketing of the device as presently labeled, is important, material, or significant in relation to the benefit to the public health from its continued marketing (see § 895.21(a)(1)). With respect to “unreasonable risk,” FDA analyzes the risks associated with the use of the device relative to the state of the art (44 FR 29214 at 29215). Thus, in determining whether a device presents an “unreasonable and substantial risk of illness or injury,” FDA analyzes the risks and the benefits the device poses to patients, comparing those risks and benefits to the risks and benefits posed by alternative treatments being used in current medical practice. Actual proof of illness or injury is not required; as Congress explained when it amended the medical device banning provisions in the FD&C Act, FDA need only find that a device presents an “unreasonable and substantial risk of illness or injury” on the basis of all available data and information (H. Rep. 94-853 at 19; 44 FR 29214 at 29215).
FDA has considered evidence from a wide variety of sources, including the scientific literature, experts in the field, State agencies that also regulate ESD use, the affected manufacturer/residential facility, individuals on whom ESDs have been used and the views of their family members, disability rights groups, and other government entities. In weighing each piece of evidence, FDA took into account its quality, such as the level of scientific rigor supporting it, the objectivity of its source, its recency, and any limitations that might weaken its value. Thus, for example, we generally gave much more weight to the results of a study reported in a peer-reviewed journal by an objective author than we did to anecdotal evidence.
As discussed in section II.A, the scientific literature demonstrates that ESDs for SIB and AB pose a number of psychological harms including depression, PTSD, anxiety, fear, substitution of other negative behaviors, worsening of underlying symptoms, and learned helplessness, as well as the physical risks of pain, and skin burns. These risks are not exclusive, and their harmful impact is magnified when an individual experiences two or more of them together. Misapplications of shocks present the same risks without any possibility of benefit. FDA determined that AEs have very likely been underreported due to various methodological limitations in the scientific literature as well as the impaired ability of many subjects to recognize and communicate AEs, which also increases the risk of harm to these individuals. Because of the likely underreporting of AEs in the literature and the fact that actual proof of harm is not required, FDA carefully considered the risks identified through other sources, which provide further support for the risks reported in the literature and indicate that ESDs are associated with additional risks such as suicidality, chronic stress, neuropathy, and injuries from falling. Although JRC has only publicly acknowledged the risks of pain and erythema, JRC's own records provide compelling evidence that aversive interventions such as ESDs are associated with several other risks, including nightmares, flashbacks of panic and rage, hypervigilance, insensitivity to fatigue or pain, changes in sleep patterns, loss of interest, difficulty concentrating, and withdrawal from usual activity.
As discussed in section II.B, the studies reported in the scientific literature show that ESDs can immediately interrupt SIB or AB upon shock, and some studies suggest varying degrees of durable conditioning. However, the studies in the literature suffer from various limitations, such as weak study design, including failure to control for concomitant treatments, small size, other methodological limitations, lack of peer review, and author conflicts of interest. As a result, the evidence is inadequate to establish that ESDs improve individuals' underlying conditions or successfully condition individuals to reduce or cease the target behavior to achieve durable long-term reduction of the target behavior. Further, to the extent ESDs do cause immediate interruption for some, the evidence also suggests that the shocks are completely ineffective for others, regardless of shock strength. Regardless of whether adaptation is the correct characterization, even JRC has acknowledged that its strongest ESD sometimes becomes ineffective,
As discussed in section II.C, FDA has determined that state-of-the-art treatments for SIB and AB are positive-based behavioral approaches along with pharmacotherapy, as appropriate, and do not include ESDs. The medical community now broadly recognizes that addressing the underlying causes of SIB and AB, including environmental ones, rather than suppressing behaviors with shocks not only avoids the risks posed by ESDs, but can achieve durable, long-term benefits. As a result, research about and use of aversive conditioning techniques overall, and ESDs in particular, has diminished considerably over the past several decades, while research about and use of positive behavioral methods has increased and continues to increase. ESDs are only used at one facility in the United States with individuals from a small number of States. Almost half of the States prohibit ESD use, and there is evidence that the overwhelming majority of patients exhibiting SIB and AB throughout the country are being treated without the use of ESDs. Although positive behavioral interventions such as PBS may not always be completely successful on their own for all behaviors in all patients, the literature shows that they are typically successful (on their own or in conjunction with pharmacotherapy), regardless of the severity of the behavior targeted, even in community settings, and can achieve durable long-term results while avoiding the risks posed by ESDs.
FDA has determined that the risks posed by ESDs for SIB and AB are important, material, or significant in relation to the benefit to the public health from their continued marketing. FDA recognizes that ESDs can cause the immediate cessation of self-injurious or aggressive behavior; however, the immediate effects the ESDs provide are outweighed by the numerous short- and long-term risks discussed earlier in this section. For many individuals who exhibit SIB or AB, these risks are magnified by their inability to adequately communicate the harms they experience to their health care providers. Even when immediate cessation is achieved, without durable conditioning the target behavior will recur over time and necessitate ongoing shocks to cause immediate cessation, magnifying the risks. If adaptation occurs, it would render the shocks wholly ineffective and could lead to stronger shocks with no effect. Thus, the degree to which the risks outweigh the benefits increases over time.
FDA has also considered the risks posed by ESDs for SIB and AB relative to the state of the art. Decades ago, health care providers had a poor understanding of the causes of SIB and AB and very limited options to treat SIB or AB. Contingent skin shock was used even though the result was fleeting and continual shock administration was needed. Since then, state-of-the-art treatment for SIB and AB has evolved considerably. Today we know that careful functional assessment, which identifies specific unwanted or undesired behaviors, the frequency and severity of these behaviors, and their specific triggers, allows for the development of positive-based behavioral therapy that provides greater benefit and poses less risk than using ESDs. Although they may demand more health care provider training and effort than ESDs, various multi-element positive interventions such as PBS and DBT are now very much viable options for treatment of SIB and AB. These interventions pose little risk and, on their own or alongside pharmacological treatments, have been shown to be successful in treating even the most severe behaviors in both clinical and community settings, and to achieve durable long-term results.
Several individuals have been successfully transitioned from ESDs at JRC to positive-based therapies elsewhere. Thus individuals exhibiting SIB or AB have alternative options to ESDs that pose less risk and provide greater benefit through durable long-term effectiveness in both clinical and community settings.
Based on a careful evaluation of the risks and benefits of ESDs for SIB and AB and the risks and benefits of state-of-the-art treatments for SIB and AB, FDA has determined the risk of illness or injury posed by ESDs for SIB and AB to be substantial and unreasonable. A majority of the expert Panel also found that ESDs for SIB and AB present a substantial and unreasonable risk of illness or injury. The Panel members who opined that this standard is not met generally had concerns about foreclosing the possibility that new ESDs may be developed in the future and used in a way that can safely and effectively treat SIB and AB. In this regard, FDA notes that a banned device is not barred from clinical study under an investigational device exemption pursuant to section 520(g) of the FD&C Act. However, any such study must meet all applicable requirements, including but not limited to, those for: Protection of human subjects (21 CFR part 50), financial disclosure by clinical investigators (21 CFR part 54), approval by institutional review boards (21 CFR part 56), and investigational device exemptions (21 CFR part 812). Other panelists were reluctant to agree that the banning standard had been met because it could be possible to develop ESDs to treat SIB or AB without being noxious. In response to these concerns, FDA notes that devices that are not noxious are not within the scope of this ban.
Other than JRC and the former JRC clinician, the only comments in opposition to a ban either at the Panel Meeting or through submission of comments to the Panel Meeting docket were from three former JRC residents, family members of individuals on whom ESDs were used at JRC (one of the parents association comments included 32 letters from family members), a Massachusetts State Representative, and one concerned citizen. As discussed earlier, FDA recognizes that family members of individuals now and previously on ESDs at JRC have had to make some very difficult decisions regarding the care of a loved one, and FDA does not doubt their intentions or question the sincerity of their belief that ESDs are the best or only option available. However, as discussed in section II.C.5, FDA has reason to believe at least some of these family members were pressured into choosing ESDs, and FDA questions whether these family members were provided with full and accurate information regarding the risks and benefits of ESDs and alternative treatment options, and whether all other options were adequately attempted prior to ESD use.
FDA has determined that labeling, or a change in labeling, cannot correct or eliminate the unreasonable and substantial risk of illness or injury. At the Panel Meeting, only members who opined that ESDs present an unreasonable and substantial risk of illness or injury (a majority of the entire Panel) were asked whether labeling could correct or eliminate this risk, and all concluded that labeling could not correct or eliminate the risks or dangers.
As explained in section II.A, the risks posed by ESDs fall under two broad categories, psychological and physical, and these risks are heightened when the devices are used to treat patients who exhibit SIB or AB because of these patients' vulnerabilities. As explained in sections I.C and II.A.1, individuals demonstrate great variability in their experience of ESD shocks, including with respect to pain and the psychological harms discussed. A person's physical state naturally
Labeling cannot correct or eliminate the risks or dangers because conditions under which providers could overcome the underlying inter- or intrapersonal variability cannot be defined. Predicting an individual's resulting experience would require knowing the initial psychological and physical states of the person, which is subjective information that providers cannot reliably know, especially when making a split-second decision whether to apply a shock. Further, individuals, especially ones with intellectual or developmental disabilities, may not be able to accurately and reliably communicate information regarding their physical or psychological state. Thus it would be impossible to create broadly applicable labeling that could account for these variables; labeling could only warn the provider that it is impossible to account adequately for all relevant factors. Because labeling cannot correct or eliminate the fact that providers lack knowledge required to mitigate the risk of harm, it cannot correct or eliminate the risks or dangers posed by ESDs for SIB or AB.
Labeling also cannot correct or eliminate ESD risks or dangers by specifying output parameters, for example, maximum current or optimal electrode placement. As explained in section II.A.1, the subjective experience, especially in terms of psychological harms, does not necessarily vary in proportion to shock strength. Even a relatively mild stimulus can trigger or contribute over time to a more serious psychological reaction (
Labeling also cannot limit the risks to only the most refractory patients. As explained, although evidence indicates that a subpopulation of refractory individuals may exist, that subpopulation is difficult if not impossible to define. The labeling of the GED devices, the only ESDs currently in use in the United States of which FDA is aware, already includes the statement that “[t]he device should be used only on patients where alternate forms of therapy have been attempted and failed.” Yet the available evidence, discussed in section II.C.5, casts doubt on whether JRC in fact applies the devices as a last resort after attempting all other approaches, and shows that patients JRC considered to be refractory were transitioned successfully to other treatments. Thus labeling has failed to limit use of the device to patients who do not have other adequate treatment options. Further, even if a refractory subpopulation could be defined, as discussed in section II.C.4, the possibility that some patients are refractory to treatment does not necessarily mean that ESDs would be an effective treatment or that the benefits of ESD use outweigh the risks. Thus labeling cannot correct or eliminate the substantial and unreasonable risk posed by ESDs.
In his report, Dr. Smith recommends against banning and that FDA should instead impose the following restrictions: “(1) A prescription and ongoing, periodic review by a board-certified physician, licensed psychologist, or licensed behavior analyst and (2) prior approval and ongoing, periodic review by an independent patient-rights committee convened by a healthcare organization that is accredited by an organization such as the Joint Commission.” Although FDA does not have to consider whether restrictions would obviate the need for a ban, we have considered Dr. Smith's proposal and do not believe restrictions would correct or eliminate the substantial and unreasonable risk posed by ESDs. The only ESDs currently in use are prescription devices and, as explained by JRC, “require multiple levels of review, approval, consent and oversight.” FDA has determined that JRC's measures do not adequately mitigate the unreasonable and substantial risk posed by these devices. While the measures Dr. Smith recommends are perhaps stronger, there is not enough information to determine that such measures would adequately mitigate the risks.
FDA is proposing that the ban apply to devices already in commercial distribution and devices already sold to the ultimate user, as well as devices sold or commercially distributed in the future (see § 895.21(d)(7)). This means ESDs currently in use on individuals would be subject to the ban and thus adulterated under section 501(g) of the FD&C Act and subject to FDA enforcement action.
FDA is proposing this because the risk of illness or injury to individuals on whom these devices are already used is just as unreasonable and substantial as it is for future individuals on whom these devices could be used. Indeed, as safer and more effective alternative treatments continue to be developed, it is the individuals on whom ESDs are currently used for whom the ban may have the most impact. The majority of the Panel agreed that, if FDA were to ban ESDs, the ban should apply to devices already in use.
JRC believes that any action “that would precipitously remove or require the eventual removal of the GED from the patients who currently rely on this court-ordered therapy would have dire consequences from a patient safety and health perspective” (Ref. 21). According to JRC, the GED “is the only treatment available to these patients”; all others were tried and failed. As an example of what could result from a mandated, sudden removal of the GED from a patient, JRC explains that one patient whose GED was removed against the medical advice of JRC health professionals soon resumed self-injurious scratching and picking behaviors that led to serious blood and bone infections, paralysis of his legs, and eventual death 3 years after leaving JRC (Ref. 139).
As discussed in section II.C, FDA does not agree that ESDs are the only treatment available for individuals exhibiting SIB or AB, no matter how severe the behavior may be, and FDA has reason to doubt whether all other treatment options were attempted for individuals prescribed these devices. FDA has not been able to verify the accuracy of JRC's account regarding an individual removed from the GED. However, even if accurate, that does not mean that the GED was not harmful to the individual, nor does it speak to the extent to which other treatments were tried after he left JRC. The only support JRC offers for this anecdote is a post on its Web site by Dr. Israel that does not include information regarding possible harms from GED use or details regarding treatment after the patient left JRC, and JRC states it offered the post as an editorial to the
However, FDA recognizes that, for certain individuals currently subject to ESDs, immediate cessation could possibly result in a significant increase of SIB or AB before appropriate alternative therapies are in effect, and a more gradual reduction toward complete removal may be necessary for some patients, especially those who have been subject to ESDs for a considerable amount of time. Thus, to account for this possibility, in appropriate circumstances, FDA does not intend to enforce the ban for a limited period of time with respect to ESDs that continue to be used on patients after the effective date. We intend to consider, for example, whether the patient has a documented medical need for gradual transition to an alternative therapy, as determined by an independent psychiatrist, psychologist, or similar State-licensed behavioral expert. We welcome comment on how long transitions may take. FDA does not intend to enforce against individual patients.
FDA is proposing that any final rule based on this proposed rule become effective 30 days after the date of its publication in the
FDA has carefully considered the potential environmental effects of this proposed rule and of possible alternative actions. In doing so, the Agency focused on the environmental impacts of its action as a result of disposal of unused ESDs that will need to be handled after the effective date of the proposed rule.
The environmental assessment (EA) considered each of the alternatives in terms of the need to provide maximum reasonable protection of human health without resulting in a significant impact on the environment. The EA considered environmental impacts related to landfill and incineration of solid waste. The proposed action would result in an initial batch disposal of used and unused ESDs primarily at a single geographic location followed by a gradual, intermittent disposal of a small number of remaining devices in this and other affected communities where these devices are used. The total number of devices to be disposed is small,
The Agency has concluded that the proposed rule would not have a significant impact on the human environment, and that an environmental impact statement is not required. FDA's finding of no significant impact (FONSI) and the evidence supporting that finding, contained in an EA prepared under 21 CFR 25.40, may be seen in the Division of Dockets Management (see
We have examined the impacts of the proposed 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 have developed a comprehensive Economic Analysis of Impacts that assesses the impacts of the proposed rule. We believe that this proposed 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 the proposed rule would only affect one entity that is not classified as small, we propose to certify that the proposed rule would not have a significant economic impact on a substantial number of small entities.
Section 202(a) of the Unfunded Mandates Reform Act of 1995 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 $144 million, using the most current (2014) Implicit Price Deflator for the Gross Domestic Product. This proposed rule would not result in an expenditure in any year that meets or exceeds this amount.
FDA is proposing to ban ESDs for the purpose of treating self-injurious or aggressive behavior. Non-quantified benefits of the proposed rule include a reduction in adverse events, such as the risk of burns, PTSD, and other physical or psychological harms related to use of the device in this patient population.
We expect that the proposed rule would only affect one entity that currently uses these devices to treat residents of their facility. The proposed rule would impose costs on this entity to read and understand the rule, as well as to provide affected individuals with alternative treatments. Although uncertain, other treatments or care at other facilities may cost more. To account for this uncertainty, we use a range of potential alternative treatment costs. At the lower bound, we assume that alternative treatments would cost the same as the current treatment. We use reimbursement data from the State of Massachusetts to estimate a potential upper bound for alternative treatments. The costs for the one affected entity to read and understand the rule range from $438 to $753. The present value of the incremental treatment costs over 10 years ranges from $0 to $60.1 million at a 3 percent discount rate, and from $0 to $51.4 million at a 7 percent discount rate. Annualized costs range from $0 million to $6.8 million at a 3 percent discount rate and from $0 million to $6.8 million at a 7 percent discount rate. The lower-bound cost estimates only include administrative costs to read and understand the rule with no incremental costs for alternative treatments. Additionally, there would be transfer payments between $11.5 million and $15 million annually either within the affected entity to treat the same individuals using alternative treatments, or between entities if affected individuals transfer to alternate facilities for treatment. The proposed rule's costs and benefits are summarized in table 2, “Economic Data: Costs and Benefits Statement.”
We also examined the economic implications of the rule as required by the Regulatory Flexibility Act. The Regulatory Flexibility Act requires us to analyze regulatory options that would minimize any significant impact of a rule on small entities. Because the proposed rule would only affect one entity that is not classified as small, we propose to certify that the proposed rule would not have a significant economic
The full discussion of economic impacts is available in Docket No. FDA-2016-N-1111 at
FDA tentatively concludes that this proposed 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.
FDA has analyzed this proposed rule in accordance with the principles set forth in Executive Order 13132. Section 4(a) of the Executive order requires Agencies to “construe . . . a Federal statute to preempt State law only where the statute contains an express preemption provision or there is some other clear evidence that the Congress intended preemption of State law, or where the exercise of State authority conflicts with the exercise of Federal authority under the Federal statute.” Federal law includes an express preemption provision that preempts certain state requirements “different from or in addition to” certain Federal requirements applicable to devices. (See section 521 of the FD&C Act (21 U.S.C. 360k);
The following references are on display in the Division of Dockets Management (see
Medical devices, Neurological devices.
Administrative practice and procedure, Labeling, Medical devices.
Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs, we propose that 21 CFR parts 882 and 895 be amended as follows:
21 U.S.C. 351, 360, 360c, 360e, 360j, 371.
(b)
21 U.S.C. 352, 360f, 360h, 360i, 371.
Electrical stimulation devices to treat aggressive or self-injurious behavior are devices that apply a noxious electrical stimulus to a person's skin to reduce or cease aggressive or self-injurious behavior.
Environmental Protection Agency (EPA).
Final supplemental finding.
This action responds to the U.S. Supreme Court decision in
This final supplemental finding is effective on April 25, 2016.
The EPA has an established docket for this action under Docket ID No. EPA-HQ-OAR-2009-0234 (National Emission Standards for Hazardous Air Pollutants for Coal- and Oil-fired Electric Utility Steam Generating Units). All documents in the docket are listed on the
Dr. Nick Hutson, Energy Strategies Group, Sector Policies and Programs Division (D243-01), U.S. EPA, Research Triangle Park, NC 27711; telephone number (919) 541-2968, facsimile number (919) 541-5450; email address:
The EPA is taking this final action in response to (1) the U.S. Supreme Court (Supreme Court) decision in
After evaluating cost reasonableness using several different metrics, the Administrator has, in accordance with her statutory duty under CAA section 112(n)(1)(A), weighed cost against the previously identified advantages of regulating HAP emissions from EGUs—including the agency's prior conclusions about the significant hazards to public health and the environment associated with such emissions and the volume of HAP that would be reduced by regulation of EGUs under CAA section 112.
In evaluating the costs of the Mercury and Air Toxics Standards (MATS), the EPA uses several cost metrics specific to the power sector to determine whether the costs of MATS are reasonable. The evaluations across each of the different metrics reveal that the cost of complying with MATS—compared to historical annual revenues, annual capital expenditures, and impacts on retail electricity prices—is well within the range of historical variability. The EPA further finds that the power sector is able to comply with the rule's requirements while maintaining its ability to perform its primary and unique function—the generation, transmission, and distribution of reliable electricity at reasonable cost to consumers. The EPA thus concludes that under every metric examined, the cost of MATS is reasonable and that no new information provided during the public comment period demonstrates otherwise.
In exercising the discretion granted to her under CAA section 112(n)(1)(A), the Administrator has taken numerous factors into account, in addition to the consideration of the cost of regulation, including Congress's concern about the hazardous nature of these pollutants, the wealth of public health and environmental effects research examined under the agency's prior findings showing substantial risks from
The Administrator's approach to making her determination is fully consistent with the dictates of the statute and with the
The EPA also presents in this action a second independent approach that supports the appropriate and necessary determination as informed by consideration of the cost of MATS: consideration of a formal benefit-cost analysis. Although the EPA does not view formal benefit-cost analysis as required to support the appropriate finding, the agency had performed such an analysis for the regulatory impacts analysis (RIA )
The EPA provided an opportunity for public comment on both approaches through a proposed supplemental finding
Based on all of these considerations, the Administrator finds that both approaches—the preferred approach and the alternative benefit-cost analysis in the MATS RIA—support her determination that consideration of cost does not cause her to alter the previous conclusion that regulation of HAP emissions from EGUs is appropriate and necessary. Therefore, in this final notice, the Administrator affirms that it is appropriate and necessary to regulate coal- and oil-fired EGUs under CAA section 112 and that these sources are properly listed as an affected source category under CAA section 112(c).
The regulated categories and entities potentially affected by this final supplemental finding are shown below in Table 1.
This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities that may be affected by this action. If you have any questions regarding the applicability of this action to a particular entity, consult either the air permitting authority for the entity or your EPA Regional representative as listed in 40 CFR 60.4 or 40 CFR 63.13 (General Provisions).
In addition to being available in the docket, an electronic copy of this final action will also be available on the World Wide Web (WWW). Following signature, a copy of this final action will be posted at the following address:
Under section 307(b)(1) of the CAA, judicial review of this final supplemental finding is available only by filing a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit Court) by June 24, 2016. Moreover, under section 307(b)(2) of the CAA, the requirements established by this final supplemental finding may not be challenged separately in any civil or criminal proceedings brought by the EPA to enforce these requirements.
In the proposal, the EPA provided notice that CAA section 307(d) was applicable to this action and has followed the requirements of that subsection. 80 FR 75042. CAA section 307(d) establishes procedural requirements specific to certain enumerated rulemakings under the CAA, and CAA section 307(d)(1)(V) provides for the extension of these procedural requirements to “such other actions as the Administrator may determine.” Section 307(d)(7)(B) of the CAA further provides that “[o]nly an objection to a rule or procedure which was raised with reasonable specificity during the period for public comment (including any public hearing) may be raised during judicial review.” This section also provides a mechanism mandating the EPA to convene a proceeding for reconsideration “[i]f the person raising an objection can demonstrate to the EPA that it was impracticable to raise such objection within [the period for public comment] or if the grounds for such objection arose after the period for public
On June 29, 2015, the Supreme Court ruled in
In Section II.B of this final supplemental finding, the EPA provides background information regarding the 2000 appropriate and necessary finding and the 2012 affirmation. Section II.C provides a summary of the proposed consideration of cost, explaining that, in the preferred approach, the EPA evaluated the cost of MATS and compared those costs to other metrics relevant to the power sector. In evaluating those cost metrics, the EPA proposed to determine that the MATS compliance costs are reasonable and that the power sector is able to comply with the rule's requirements while retaining its ability to perform its primary and unique function—the generation, transmission, and distribution of reliable electricity at a reasonable cost to consumers. The Administrator then weighed this evaluation of cost against previously identified advantages of regulation—such as addressing the significant hazards to public health and the environment posed by HAP emissions from EGUs. The EPA also considered the formal benefit-cost analysis from the final MATS RIA that showed the benefits (monetized and non-monetized) of the rule are substantial and far outweigh the costs. The EPA then proposed to find that consideration of such costs does not cause the agency to alter its previous finding that regulation of HAP emissions from EGUs is appropriate and necessary.
The EPA received numerous public comments on the proposed supplemental finding. In Section III.A below, the EPA explains how consideration of the public comments resulted in the addition of a limited analysis that reinforces the final supplemental finding. In Section III.B, we explain the basis for the final action, and, in Section III.C we affirm the proposed finding that a consideration of cost does not cause the EPA to change its conclusion that regulation of HAP emissions from coal- and oil-fired EGUs is appropriate and necessary and that EGUs are, therefore, properly included on the CAA section 112(c) list of sources that must be regulated under CAA section 112(d).
In Section IV below, the EPA provides a summary of selected significant comments and the agency's response to those comments. The Response to Comments (RTC) document
On December 20, 2000, the EPA determined, pursuant to CAA section 112(n)(1)(A), that it was appropriate and necessary to regulate coal- and oil-fired EGUs under CAA section 112 and added such units to the CAA section 112(c) list of sources that must be regulated under CAA section 112(d). December 2000 Finding; 65 FR 79825. The appropriate and necessary finding was based primarily on consideration of the
In 2005, the EPA issued the Section 112(n) Revision Rule (70 FR 15994) that revised the agency's December 2000 appropriate and necessary finding and removed coal- and oil-fired EGUs from the CAA section 112(c) source category list. The agency also promulgated the Clean Air Mercury Rule (CAMR) which established CAA section 111 standards of performance for mercury emissions from EGUs. Several groups challenged these actions and on February 8, 2008, the D.C. Circuit Court vacated both the Section 112(n) Revision Rule and CAMR holding that the EPA had failed to comply with the requirements of CAA section 112(c)(9) for delisting source categories.
In May 2011, in conjunction with the proposed MATS, the EPA conducted additional technical analyses to reaffirm the appropriate and necessary finding, including peer-reviewed risk assessments on human health effects
Between the proposed and final MATS rule, the EPA conducted peer reviews of the Mercury Risk Assessment
Moreover, the EPA concluded that in 2016, after implementation of other provisions of the CAA, HAP emissions from U.S. EGUs would still reasonably be anticipated to pose hazards to public health.
Based on the agency's updated analyses, a consideration of the peer reviews of the analyses, and public comments, the EPA affirmed the findings in the February 2012 final rule (77 FR 9304) that mercury and non-mercury HAP emissions from U.S. EGUs pose hazards to public health and found that it remains appropriate to regulate U.S. EGUs under CAA section 112. The EPA also concluded, at that time, that it remains appropriate to regulate U.S. EGUs under CAA section 112 because of the magnitude of mercury and non-mercury HAP emissions, environmental effects of mercury and certain non-mercury HAP emissions, and the availability of controls to reduce HAP emissions from EGUs. In addition, the EPA concluded that the hazards to public health from mercury and non-mercury HAP emissions from U.S. EGUs are reasonably anticipated to remain after imposition of the requirements of the CAA. The same is true for hazards to the environment. Thus, the agency confirmed that it is necessary to regulate U.S. EGUs under CAA section 112. 77 FR 9311.
After MATS was promulgated, industry, states, environmental organizations, and public health organizations challenged many aspects of the EPA's appropriate and necessary finding and the final MATS rule in the D.C. Circuit Court, and the Court denied all challenges.
In response to the Supreme Court's direction, the EPA proposed two different approaches to incorporate cost into the appropriate and necessary finding. 80 FR 75025. The first—which the EPA identified as its preferred approach—evaluated the cost estimates in the RIA for the final MATS rule using several different metrics and weighed these costs against the previously identified advantages of regulating HAP emissions from EGUs—including the agency's prior conclusions about the significant hazards to public health and the environment associated with such emissions and the volume of HAP that would be reduced by regulation of EGUs under CAA section 112. In a second independent approach, the EPA proposed consideration of the formal benefit-cost analysis
U.S. EPA. 2010.
In the preferred approach, the EPA considered whether the cost of compliance with MATS is reasonable, and whether a consideration of such costs, when weighed against, among other things, the substantial hazards to public health and the environment posed by HAP emissions from power plants, causes the agency to alter its conclusion that regulation is appropriate and necessary. The EPA explained that it preferred this approach to a formal benefit-cost analysis given the statutory objectives of CAA section 112, in particular Congress' determination that HAP emissions are inherently harmful, and the instruction from Congress to protect the most sensitive populations from those harms. See Legal Memorandum at 6-20. The EPA found that CAA section 112(n)(1)(A)'s emphasis on the required studies supported its interpretation that while cost is an important factor that it must consider in making the appropriate and necessary finding, it is one of several factors that must be considered and the statutory text does not support a conclusion that cost should be the predominant or overriding factor.
The agency further explained that, as a check on the conclusion that the cost of MATS is reasonable, the EPA considered the power industry's ability to comply with MATS and still perform its primary and unique function—to provide a reliable source of electricity at a reasonable cost to consumers.
Specifically, the EPA considered several metrics to evaluate whether the estimated cost of compliance with MATS is reasonable for the power sector.
A second way the EPA evaluated cost was to compare the annual capital expenditures due to MATS compliance to the range of variation in the power sector's annual capital expenditures between 2000 and 2011. As noted in the proposed supplemental finding, this comparison is a relevant metric because capital costs represent largely irreversible investments that must be paid off regardless of future economic conditions. Moreover, additional capital expenditures needed to comply with MATS represented about 26 percent of the total annual compliance cost projected for 2015, further emphasizing the importance of considering capital expenditures. Based on two different sources of data, capital expenditures for the electric power sector generally increased from 2000 to 2011.
The third metric the EPA evaluated was the impact of MATS compliance cost on the retail price of electricity. Potential changes in retail electricity prices can be indicative of the “cost” of MATS, in this instance to consumers specifically, as opposed to the compliance cost to the power sector, which is borne collectively by EGU owners and electricity consumers. The MATS RIA estimated that relatively small changes in the average price of electricity would result from MATS compliance. The projected impact of MATS on electricity rates was 0.3 cents/kWh or 3.1 percent. Meanwhile, between 2000 and 2011, changes in national average retail prices ranged from −0.13 cents/kWh to as high as 0.52 cents/kWh.
The agency then proposed that each of these three metrics independently demonstrates that the MATS compliance costs are reasonable, and that each metric supports the EPA's proposed determination that weighing this consideration of cost against the prior conclusions reached by the agency does not alter the previous finding that it is appropriate to regulate HAP emissions from EGUs.
In addition to the analysis summarized above, the EPA recognized it was important to consider the ability of the power sector to comply with MATS and maintain a reliable supply of electricity. The agency's compliance modeling indicated that additional coal-fired capacity projected to retire as a result of MATS represented EGUs that are, on average, older and smaller units that are less frequently used.
The EPA then weighed the reasonable cost of the rule against a number of other factors, including the agency's prior conclusions about the significant hazards to public health and the environment, as discussed above in Section II.B, and the volume of HAP that would be reduced by regulation of EGUs under CAA section 112. Keeping in mind Congress' statutory goals in enacting CAA section 112, the EPA proposed to find that a consideration of the cost of compliance with MATS did not outweigh the rule's many advantages and, therefore, does not cause the EPA to alter the prior determination that it is appropriate and necessary to regulate EGUs under CAA section 112.
In the proposed supplemental finding, the EPA also presented a second independent basis for concluding that consideration of cost supports affirmation of the finding that it is appropriate and necessary to regulate HAP emissions from coal- and oil-fired EGUs. The EPA explained that the formal benefit-cost analysis in the RIA for the final MATS rule, although not required to support the appropriate finding, also demonstrates that the benefits (monetized and non-monetized) of MATS are substantial and far outweigh the costs. Specifically, the EPA estimated that the final MATS would yield total annual monetized benefits (in 2007 dollars) of between $37 billion to $90 billion using a 3-percent discount rate and $33 billion to $81 billion using a 7-percent discount rate in addition to many categories of unquantified benefits in comparison to the projected $9.6 billion in annual costs. The benefit-cost analysis thus supports the finding that it is appropriate to regulate HAP emissions from EGUs.
Using both of these independent approaches, the EPA proposed to find that it remains appropriate to regulate HAP emissions from EGUs after considering costs. As such, the EPA proposed to find that including a consideration of cost does not alter the agency's previous determination that it is appropriate to regulate HAP emissions from EGUs under CAA section 112 and that coal- and oil-fired EGUs are properly listed pursuant to CAA section 112(c).
A number of groups representing states, tribes, industries, environmental organizations, health organizations, and others submitted comments on the proposed supplemental finding. The EPA has considered the comments and provided detailed responses to the significant comments either below in Section IV of this final notice or in the RTC document for this action.
The EPA has taken all the submitted comments into consideration in the preparation of this final supplemental finding. The EPA received comments that were both supportive and critical of both proposed approaches to considering cost. The EPA has carefully evaluated these comments and responded to them, as outlined in detail in Section IV below.
The EPA did not receive any public comments that caused the agency to conclude that the interpretation of the statute or the approaches for consideration of cost that were detailed in the proposed action were in error. Therefore, in this final action, the EPA continues to rely on the analyses contained in the proposed supplemental finding and in the companion Legal Memorandum. Specifically, in this final consideration of cost, the EPA continues to rely on the “Consideration of Cost to the Power Sector” metrics discussed in Section IV.A of the proposed supplemental finding. 80 FR 75032. These metrics are summarized above in Section II.C. The metrics include an evaluation of the cost of MATS compliance in comparison to the power sector's revenues from retail sales of electricity. In addition, the EPA continues to rely on the metric comparing the impact of MATS on the retail price of electricity to historical fluctuations of the average retail price of electricity. The EPA also stands by the evaluation of resource adequacy that was presented in the final MATS rulemaking and in the proposed supplemental finding. We explain here in this final notice—and in the RTC document—the decision not to alter these analyses for this final action.
While the agency has not changed its approaches to consideration of cost, the EPA has, in response to comments, supplemented the proposed metrics by incorporating additional information considering annual operating expenses to this industry. Specifically, the EPA added information on historical total production expenditures to the historical total capital expenditures in order to estimate total capital and production expenditures for the power sector from 2000 to 2011. The agency conducted this analysis to provide additional perspective to the projected cost information by looking at a broader range of power industry costs beyond the capital cost comparison conducted at proposal. The additional analysis reinforces the EPA's conclusion that the cost of compliance with MATS is reasonable.
Consistent with the proposal's focus on sector-level analysis, the EPA obtained historical information on power sector production costs. These production costs, which include operation and maintenance costs, fuel costs, and fixed costs were obtained from ABB Velocity Suite, a private sector firm that provides data and analytical services for the energy sector. The production costs were added to the two separate estimates of annual capital expenditures that were provided in the proposed supplemental finding (
The estimated $9.6 billion total annual cost of the rule represents the total incremental annual capital and production costs to the sector for 2015. This incremental cost due to MATS requirements represents a small fraction of the power sector's annual capital and production expenditures in recent years, as illustrated in Table 2. For example, when compared to historical total expenditures that rely upon SNL-based estimates of capital expenditures, the total 2015 MATS cost represents about 4.3 percent of total expenditures in 2008 to 6.4 percent of total expenditures in both 2002 and 2003. With respect to historical total expenditures that rely upon Census Bureau-based estimates of capital expenditures, the total 2015 MATS cost represents about 4.2 percent of total expenditures in 2008 to 6.1 percent of total expenditures in 2004.
Additionally, the EPA notes that, similar to the capital expenditures analysis set forth in the proposed supplemental finding, the projected $9.6 billion in incremental capital plus production costs is well within the range of annual variability in costs in general over the 2000 to 2011 period. For example, during this period, the largest year-to-year decrease in power sector-level capital and production expenditures ranged from $31.8 billion (from 2008 to 2009, according to the sum of SNL-based capital expenditure and Velocity Suite-based production expenditure estimates) to $32.9 billion (from 2001 to 2002, according to the sum of U.S. Census-based capital expenditure and Velocity Suite-based production expenditure estimates). The largest year-to-year increase in power sector-level capital and production expenditures in this period ranged from $28.0 billion (from 2000 to 2001, according to the sum of U.S. Census-based capital expenditure and Velocity Suite-based production expenditure estimates) to $28.2 billion (from 2004 to 2005, according to the sum of SNL-based capital expenditure and Velocity Suite-based production expenditure estimates).
This wide range indicates substantial year-to-year variability in industry expenditures, and the projected $9.6 billion increase in total expenditures in 2015 attributable to MATS falls well within this variability. Therefore, the supplemental analysis that is responsive to commenters' suggestion provides additional support for the conclusion that the cost of MATS is reasonable when weighed against historical metrics.
As directed by the Supreme Court, the EPA has now considered cost in its evaluation of whether or not it is appropriate to regulate coal- and oil-fired EGUs under CAA section 112. The EPA's approach to considering cost under CAA section 112(n)(1)(A) is based on the interpretation of the relevant CAA provisions as described in the Legal Memorandum accompanying the proposed supplemental finding. As explained below in Section IV.C, the EPA stands by the interpretations presented in that document in this final action.
As previously mentioned in Section III.A, the EPA, in this final action, is continuing to rely on the same cost metrics that were presented in the proposed supplemental finding—supplemented by an additional evaluation of MATS compliance cost estimates in the context of total capital and production costs from the 2000 to 2011 period that simply confirms the proposed findings. No commenter provided any evidence or information that convinced the EPA that the preferred approach to consideration of cost is inadequate or unreasonable. Thus, the EPA concludes in this final action that the preferred approach to considering cost in the appropriate and necessary finding is to weigh the cost of compliance with section 112(d) standards against, among other things, the volume of HAP emitted by EGUs and the associated hazards to public health and the environment.
The EPA also continues to rely on the results of the formal benefit-cost analysis contained in the RIA for MATS as we received no public comments that convinced us that this analysis is an insufficient approach to considering costs. Although the EPA does not view formal benefit-cost analysis as required to support the appropriate finding, the final RIA demonstrates that the benefits (monetized and non-monetized) of MATS are substantial and far outweigh the costs. In fact, the monetized benefits exceed the cost by 3 to 9 times. Thus, for this final action, the EPA finds that the formal benefit-cost analysis in the final MATS RIA provides an independent basis to support the finding that a consideration of cost does not cause the agency to alter its determination that it is appropriate and necessary to regulate HAP emissions from EGUs. This conclusion is explained in greater detail in the proposed supplemental finding.
The EPA further notes that the Supreme Court's decision in
The Administrator has weighed the cost of MATS against other relevant considerations in determining that it remains appropriate and necessary to regulate HAP emissions from EGUs. These other considerations include prior conclusions reached regarding the significant hazards to public health and the environment from HAP emissions from EGUs, and the agency's prior determination that these hazards will not be addressed through imposition of the requirements of the CAA. The Administrator's conclusion that, on balance, these factors support the appropriate finding is presented in the proposed supplemental finding,
The EPA also concludes that the formal benefit-cost analysis contained in the RIA for MATS provides an independent basis to support the finding that a consideration of cost does not cause us to alter our determination that it is appropriate and necessary to regulate HAP emissions from EGUs. This conclusion is explained in detail in the proposed supplemental finding.
Based on all of these considerations, the Administrator finds that the preferred approach and the benefit-cost analysis in the RIA for MATS each provide alternative independent bases to support the conclusion that a consideration of cost does not cause the agency to alter its previous determination that it is appropriate to regulate HAP emissions from EGUs. For all these reasons, the Administrator affirms that it is appropriate and necessary to regulate coal- and oil-fired EGUs under CAA section 112 and that these sources are properly listed as an affected source category under CAA section 112(c).
This final action is in response to the Supreme Court's ruling that the agency erred by not considering cost in the initial determination that regulation of HAP emissions from EGUs is appropriate under CAA section 112. In the proposed supplemental finding, the EPA provided detailed information on how the agency has added such a consideration of cost and further explained why including such consideration does not alter the agency's previous determination. The EPA specifically requested comment on the proposed supplemental finding and on the companion Legal Memorandum.
The EPA received a number of comment submissions from groups representing states, tribes, industries, environmental organizations, health organizations, and others. The EPA has taken all the submitted comments into consideration in preparing this final supplemental finding. All of the comments have been summarized and the EPA has provided detailed responses to the significant comments either here in this final notice or in the RTC document for the supplemental finding available in the rulemaking docket.
This Section of the notice addresses comments and responses to the EPA's preferred approach to consideration and incorporation of costs, analytical issues such as the use of compliance costs for the entire power sector, the use of the compliance cost and impact estimates from the final MATS RIA, and responses to comments on the cost metrics used to
Moreover, many commenters strongly supported the EPA's preferred approach of weighing a consideration of cost against the many advantages of regulating HAP emissions from EGUs already identified by the agency. Several federally-recognized Indian tribes and inter-tribal organizations commented in support of the agency's methodology of weighing the hazards of HAP emissions from EGUs to public health and the environment against the costs of compliance. These commenters emphasized that this method of analysis would allow for consideration of important tribal interests and threats to longstanding Indian cultural traditions and critical social practices of fishing and fish consumption. Moreover, the tribal commenters also added that a benefit-cost analysis would not fully account for the MATS rule's impact on the tribes and pointed to the United States' treaty obligations to protect tribal rights and the resources of American Indians and tribes as an important consideration supporting the finding. Commenters supporting the EPA's preferred cost approach pointed out that the statute and the
Other commenters, however, claimed that the EPA's preferred approach to considering cost for purposes of CAA section 112(n)(1)(A) does not rationally balance the costs of the rule against the public health and environmental harms previously identified. Those commenters acknowledged that the Supreme Court's decision in
As discussed above in Section II.C and III.A, the agency evaluated the reasonableness of the regulation's cost of compliance by comparing that cost to metrics relevant to the utility sector: revenues, expenditures (including capital and production costs), and retail electricity rates, and also the impact that compliance with the CAA section 112(d) standards would have on the power sector's ability to provide a reliable source of electricity. After concluding the costs of MATS are reasonable based on these metrics, the agency confirmed that the industry could comply with MATS without unreasonably increasing electricity prices or undermining the reliability of the electric grid.
The Administrator has taken this consideration of cost and weighed it against the other findings that were part of the EPA's prior evaluation of whether regulation of HAP emissions from EGUs is appropriate and necessary. See Section II.B above. The prior record supporting the original appropriate and necessary finding includes the agency's prior conclusions, based on the scientific evidence, that HAP emissions from EGUs pose significant hazards to public health and the environment and the conclusion that those emissions will not be addressed through imposition of other requirements of the CAA. The EPA also previously concluded that EGUs are by far the largest remaining source of mercury, selenium, hydrogen chloride, and hydrogen fluoride emissions, accounting for half or more of all U.S. anthropogenic emissions of such HAP, and that EGUs contribute a considerable percentage of all U.S. anthropogenic emissions of arsenic, chromium, nickel, and other metallic HAP emissions. The agency also confirmed the availability of controls to reduce these HAP emissions from EGUs. In addition, the agency found that MATS would achieve significant reductions of EGU emissions of HAP and a failure to regulate would result in continued emissions of significant
Not only does the agency's preferred approach comport with the statute and the
Moreover, the EPA notes that most commenters opposed to the EPA's preferred approach appear to dismiss outright the advantages of regulating HAP emissions, including the EPA's assessment, as articulated in the Legal Memorandum, that such regulation furthers the goal of CAA section 112 to obtain prompt, permanent, and ongoing reductions in significant volumes of HAP emissions that pose hazards to public health and/or the environment. No commenter has demonstrated that any of the HAP that are emitted from EGUs are chemically different than HAP emitted from other stationary sources or provided any other support for a conclusion that the inherent risks associated with HAP emissions that were acknowledged by Congress are somehow inapplicable to HAP emissions from EGUs.
Instead, these commenters dismiss the agency's preferred approach without much analysis and conclude that the only rational consideration of cost is a bare comparison of the rule's costs of compliance with its monetized HAP-specific benefits, and the only way the EPA may find regulation to be appropriate and necessary under CAA section 112(n)(1)(A) is if that comparison results in a “positive net benefit.” The EPA disagrees that a benefit-cost analysis, particularly one that only accounts for monetized HAP specific benefits, or a finding of an economic positive net benefit, is required by CAA section 112(n)(1)(A) to determine whether regulation of HAP emissions from EGUs is appropriate and necessary, nor does the agency agree that such an analysis is the better approach.
The Supreme Court explicitly declined to mandate that the Administrator perform a benefit-cost analysis to satisfy her obligation to consider cost under CAA section 112(n)(1)(A). Specifically, the Court stated, “We . . . do not hold that the law unambiguously required the Agency, when making this preliminary estimate, to conduct a formal cost-benefit analysis
We note that, in insisting that the Administrator is required to perform a benefit-cost analysis to satisfy her obligation to consider cost, the commenters also assert that the EPA may not rely on co-benefits associated with reductions in non-HAP emissions in weighing the advantages and disadvantages of regulation under CAA section 112(n)(1)(A).
Finally, while the EPA disagrees that section 112(n)(1)(A) in any way requires the Administrator to determine that regulation will have monetized positive “net benefits” to society, the record amply demonstrates that the advantages of MATS for society do in fact outweigh the disadvantages. The Administrator found that regulation of HAP emissions from EGUs has many advantages, chief among them is furthering Congress' goal of protecting the public, including sensitive populations, from risks posed by HAP emissions by reducing the volume of, and thus, the exposure to, those harmful pollutants. In light of the risk findings and the determination that the regulations are cost reasonable and will not impair the power sector's primary function of providing reliable electricity at a reasonable cost to consumers, the Administrator concludes that “the significant advantages of
The commenters alleged that, in the proposed supplemental finding, the EPA sets out the factors that it has considered and then declares “by fiat” that the regulation is appropriate, without comparing the significance of the factors on either side or explaining how the different factors relate to one another. One commenter stated that, even if the EPA had discretion to use an approach like the multi-factor balancing one, the agency “must cogently explain why it has exercised its discretion in a given manner,” citing
As noted by the D.C. Circuit Court, “[a]gencies routinely employ multi-factor standards when discharging their statutory duties, and we have never hesitated to uphold their decisions when adequately explained.”
We also disagree with the commenters who suggest the proposed notice failed to explain and articulate the basis for the finding. The Supreme Court has said that a rule will be found to be arbitrary and capricious “if the agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.”
But here, the EPA has not relied on factors that Congress has prohibited it to consider, nor have commenters demonstrated that there is an aspect to the problem that the EPA has ignored. There is no question as to the theory underlying the agency's action; the agency has given meaning to its understanding of the appropriate and necessary determination by laying out all of the many factors and criteria that it considered based on a thorough examination of the statute in light of the
The EPA used four metrics to evaluate the cost reasonableness of MATS and concluded that the costs associated with MATS are consistent with historical costs incurred in the power sector. 80 FR 75033-36. The EPA also confirmed that the power sector can reasonably absorb the compliance costs associated with MATS without impairing its ability to perform its primary and unique function —the generation, transmission,
The commenters are also incorrect that the Administrator failed to provide any sense of the relative weight or importance of the different factors considered under the agency's preferred approach. Commenters complain that the Administrator's balancing of the factors against each other is “indecipherable,” but it seems instead that they simply disagree that the costs are reasonable, that HAP emissions from EGUs pose hazards to public health and the environment, that the finding can consider harms to the environment, and that there is any benefit to regulating HAP emissions. As explained above, we disagree with the commenters' interpretations and further note that the bright line tests and thresholds they appear to prefer are not required under the statute or the case law. The D.C. Circuit Court has found that “[a]n agency is free to adopt a totality-of-the-circumstances test to implement a statute that confers broad authority, even if that test lacks a definite “threshold” or “clear line of demarcation to define an open-ended term.” ”
In its proposed supplemental finding and the Legal Memorandum, the EPA pointed out section 112(n)(1)(A)'s silence regarding the weight to be given to the relevant factors in determining whether it is “appropriate” to regulate HAP emissions from EGUs. 80 FR 75030; Legal Memorandum at 19. Given this statutory silence, the EPA concluded that it was reasonable to consider the objectives of section 112 in deciding how to assign relative weight to the factors under consideration.
Finally, the Administrator must exercise her judgment in deciding whether the costs of regulation justify its advantages and the agency need not demonstrate that her decision is the same decision that would be made by another Administrator or a reviewing court. An agency action need not be the only approach or even the approach that a reviewing court might find most reasonable. Instead, the test is “whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment.”
Commenters' preference for a different approach that would have compared cost of compliance to monetized benefits of reducing HAP does not undermine the validity of the EPA's interpretation of CAA section 112(n)(1)(A) and
The hypothetical scenario posed by commenters regarding how the EPA's approach would apply to a financially strained industry is neither realistic nor relevant. The hypothetical they pose could never occur as cost considerations are not relevant to listing decisions for any source category besides EGUs. Moreover, nothing in the EPA's preferred approach would require the EPA to ignore the potential benefits (
Several commenters stated that some estimates of industry compliance costs have been much lower than those projected by the EPA in the final MATS RIA. One study cited by commenters found that the costs of control technologies have been less expensive and more effective than assumed in the RIA, and therefore the actual cost of complying with MATS has been significantly less than estimated by the EPA. This analysis was based on existing contracts for the installation of air pollution control systems, experience with the performance of emissions control technologies, and assessments of the amount of pollution control capacity installed by the power sector to comply with MATS. This analysis estimated that industry's actual annual compliance costs are currently approximately $2 billion, which is less than one-quarter of the $9.6 billion annual cost that the EPA estimated for MATS.
Other commenters contended that the EPA's use of the MATS RIA cost estimates does not accurately reflect costs of compliance. One commenter said the EPA significantly overestimated the capability of dry sorbent injection (DSI) by assuming that it could be used to meet the acid gas emission standards regardless of the size of the unit. The commenter also alleged that the EPA incorrectly projected that wet scrubbers would not be widely required to meet the proposed emission limits, and that the MATS RIA estimates therefore underestimated compliance costs and the number of retirements. Other commenters asserted that the EPA's alleged underestimate of retirements generally demonstrates that the costs of the rule are not reasonable and that the agency's assessment was based on flawed assumptions. Commenters disagreed with the EPA's focus on projected compliance costs and generation capacity estimated at the time of MATS promulgation and suggested that the EPA should consider actual costs and retirements that have occurred since the promulgation of MATS to update the assumptions made in the RIA instead of using assumptions that the commenters argue are unrepresentative. The commenters alleged that the EPA's continued use of those assumptions when actual, new data are available is arbitrary and capricious.
Both the statute and the
We also disagree with the suggestion by commenters that the entire economic analysis that the EPA performed in the MATS RIA is invalid simply because of a discrepancy between modeling projections and actual outcomes.
The EPA disagrees with commenters who assert that the EPA underestimated the costs of particular control technologies. In response to comments received on the proposed MATS rule, the EPA reviewed control technology cost and performance assumptions and updated some of these assumptions in the final RIA. Additionally, in the response to comment section of the final MATS preamble, the EPA responds to a series of comments on the cost and performance assumptions of the control technologies in the RIA. For example, in Section VII.G.1 of the final MATS preamble, the EPA responds to comments regarding the technical applicability, cost, and performance of DSI, explaining that the “representation of DSI in MATS compliance modeling is reasonable, is properly limited to applications that are technically feasible, and reflects a conservative approach to modeling future use of this technology.”
The EPA also disagrees with commenters that the number of retirements of coal- and oil-fired power plants that have occurred since the rule's promulgation indicates that the EPA's assumptions in the MATS RIA were flawed. Commenters argue that because there have been more retirements in recent years than the EPA predicted in the RIA would be attributable to MATS, that the EPA's assumptions are necessarily flawed. However, commenters fail to show that the additional retirements they cite are attributable to MATS. Coal-fired power plants shut down for reasons other than MATS. Numerous publications have pointed out that recent trends in the electric power industry, such as low natural gas prices and slow demand growth, have placed significant economic pressure on coal-fired power plants, even those that are compliant with MATS.
Mooney, Chris. 2015. “How super low natural gas prices are reshaping how we get our power.”
Larson, Aaron. 2016. “Power Generation Industry Faces Fundamental Changes.”
Cassell, Barry. 2015. “Luminant switches a second unit at the Martin Lake coal plant into seasonal operations.”
Smith, Rebecca. 2014. “How Shale-Gas Boom Led to Demise of Energy Future Holdings.” The Wall Street Journal. April 29. Available at:
U.S. EIA. 2016. “Natural gas expected to surpass coal in mix of fuel used for U.S. power generation in 2016.”
The EPA's cost analysis, summarized in the MATS RIA, was based on reasonable assumptions at the time of promulgation for important factors such as fuel supply, fuel prices, and electricity demand. More importantly, retirements that are not attributable to MATS cannot reasonably be considered a cost of compliance for MATS. Commenters have not demonstrated that any recent retirements not accounted for in the MATS RIA are solely or disproportionately a result of MATS and would not have occurred in the absence of MATS. For these reasons, in making the initial appropriate finding, it is reasonable for the EPA to use the final MATS RIA cost estimates, which were developed at the time the rule was finalized and are based on high quality economic, technical, and regulatory assumptions.
Moreover, in its consideration of cost here, the agency elected to focus on the 2015 impacts presented in the RIA because, as some commenters note, the modeling the agency conducted
The independent analysis cited by several commenters, which was the only retrospective analysis of MATS costs submitted to the EPA in comments, finds that a variety of control technology costs have shown to be lower than the EPA's projection from the final MATS RIA. These results further contradict the assertions of some commenters that the assumptions in the RIA led to an underestimate of costs. The EPA recognizes it is possible, and has historically been the case for other regulations, that the regulated industry develops ways to comply with regulations at lower cost than what the agency projects at the time of rule promulgation. However, the suggestion by the retrospective analysis that important components of the actual compliance cost of MATS are lower than the agency's projections does not alter the agency's determination that the analysis in the final MATS RIA represents the best and most comprehensive estimate of the cost of compliance with MATS available to the EPA for use in this finding, because it was developed at the time the agency reaffirmed the appropriate and necessary finding and established CAA section 112(d) standards for EGUs.
Another commenter stated that the EPA's framing of the cost inquiry—whether the power sector can reasonably absorb the cost of the MATS Rule, 80 FR 75030—is reasonable, and well within its discretion, citing
Finally, many commenters in MATS and in this supplemental finding agree that cost reasonableness can be determined in part by increases in electricity prices, which reflect increased expenditures by EGUs resulting from MATS. By advocating for the consideration of electricity price impacts, these commenters further support EPA's determination that it is appropriate to consider other cost metrics at the sector level as well. The EPA's estimate of the cost of MATS is an appropriately complete accounting of the costs incurred by the sector, and the agency's comparison of these costs to the sector-wide metrics is reasonable.
Commenters disagreeing with the agency's analysis of compliance costs as a percentage of power sector sales argue it is misleading because it ignores the relationship between revenues and expenses and, therefore, in their view, provides no indication of cost reasonableness. The commenters suggested that given the high operating costs for EGUs, a comparison of
One commenter stated that the EPA does not explain why the analysis of compliance costs as a percentage of power sector sales is appropriate for the utility sector. The commenter noted that this type of analysis is generally used for measuring economic impacts to small entities under the Regulatory Flexibility Act (RFA) and, in that context, sales are generally measured per company or on another more granular level.
While the EPA recognizes that alternative metrics could also be useful, the application of such alternative metrics would not invalidate the use of compliance costs as a percentage of power sector sales as demonstrating cost-reasonableness. The level of sales in the industry is, over time, representative of the costs incurred by the industry to generate, transmit, and distribute electricity, as the firms that operate in the electricity sector usually do so with the expectation that they will recover their costs (
The EPA disagrees that a comparison of the costs of complying with MATS and the power sector's sales is an unreasonable way to evaluate costs simply because this type of comparison is often made in the context of evaluating economic impacts on small businesses. While commenters point out that the analysis is often used for smaller entities, they do not demonstrate why the metric holds no value for examining economic impacts on the power sector.
Further, with regard to the specific metric suggested by commenters opposed to using compliance costs as a percentage of power sector sales to consider costs, we note that while net operating income is an important indicator for utilities and other operating entities, as discussed in this section above, a significant share of operating expenditures may ultimately be borne by consumers. Therefore, comparing the costs borne by electricity producers to their net operating income (
Additionally, there are difficulties associated with estimating changes in firm-level net-operating income or other measures of firm profits with the data and tools available to the agency. For example, many firms in the industry are not publicly traded, so historical profit data for many of these firms are not readily available; therefore, a comparison of an estimate of the change in profits to historical data on profits in the industry would be limited by data availability. Furthermore, there are accounting and tax practices that affect the timing of when profits are reported, and therefore measures of profits may fluctuate on an annual basis for reasons not directly related to coincident annual changes in revenues and expenditures. In addition, the fact that a large proportion of affected EGUs in the power sector operate within regulated markets and are able to pass regulatory costs to electricity consumers, yet often face different specific requirements for how and when they may recover those costs, presents challenges to the use of a change in net operating income as a metric for evaluating costs.
Commenters advocating changes in net operating income as a more appropriate metric than a metric based on compliance costs as a percentage of power sector sales for measuring cost reasonableness do not supply any analysis in their comment, nor do they provide a source of historical data to use for this analysis, nor a way to address these technical challenges with estimating historical profits, nor do they assert that a different metric would result in a conclusion that contradicts the EPA's findings. However, in response to comments highlighting the importance of considering annual operating expenses to this industry, the EPA considered additional information on operating expenses in order to ensure that our analysis of retrospective and projected cost information is robust and complete. This supplemental analysis was discussed earlier in Section III.A. In sum, the EPA continues to find that it is reasonable, when evaluating the reasonableness of the costs of MATS, to compare those costs to utility sector sales.
Other commenters took issue with the EPA's comparison of annual capital expenditures required by MATS to overall power-sector capital expenditures as a way to assess whether the rule's compliance costs are reasonable. These commenters stated that the power sector's historical annual capital expenditures are broad, all-encompassing statistics that do not provide an adequate basis to judge whether compliance expenditures are reasonable. Specifically, this commenter suggested that the EPA's analysis should instead focus on the historical annual capital expenditures of only the entities that own affected sources. One commenter argued that the EPA did not explain the benefits of this approach over any other approach, or why it is a good measure of the reasonableness of the costs of a regulation.
We disagree with the comment alleging that the EPA's analysis of this metric is “too broad”. Specifically, we do not agree with the commenter's suggestion that we should restrict our analysis of capital expenditures to focus on only the entities directly regulated by MATS (
Moreover, we disagree with the commenter's implied premise that an estimate of the capital expenditure costs associated with installing controls to comply with MATS actually reflects capital expenditure impacts on entities owning “affected sources”. As noted in Section IV.A.3, many of these sources are able to pass-through compliance costs to ratepayers, and, thus the cost of compliance, including capital expenditure costs, are in many cases ultimately borne by consumers. The EPA's sector-level approach to analyzing cost for this metric, as for others, takes into account all costs whether they are borne by producers or consumers, and is therefore the most comprehensive and well-suited to evaluating whether such costs are reasonable.
Additionally, in response to comments, the EPA supplemented its analysis of annual capital costs with annual production costs, the sum of which provides a more comprehensive metric to use to compare against total projected compliance costs (see Section IV.A.4 above). This addition confirmed the EPA's earlier finding that the compliance costs of this rule are projected to be well within historical variability, and continues to demonstrate that the agency's projected costs are reasonable when weighed against historical metrics.
A commenter stated that the EPA's retail price of electricity metric masks the true effects of the rule because the commenter believes that the EPA failed to acknowledge that, of the 11 years examined, only 3 years saw greater average price increases than would be caused by the rule. The commenter added that the EPA did not acknowledge that the MATS rule causes average retail price of electricity increases that are almost double that of an average of the 11 examined years and that the EPA did not recognize that the price increases caused by the rule are additive.
Additionally, the EPA notes that the commenters' point regarding additive impacts is incorrect. The 0.3 cents per kilowatt-hour is incremental to the EPA's estimated average retail electricity price in the absence of the rule, not historical levels (which are actually higher in 2006-2011, on average, than the EPA's base case estimates for 2015). As the EPA explains in the preamble to the final MATS rule, “Even with this rule in effect, electricity prices are projected to be lower in 2015 and 2020 than they were in 2010.” In the EPA's consideration of the potential impacts of MATS on retail electricity prices, the agency appropriately considered the estimated increase in prices projected to occur as a result of MATS in the context of historical variability.
Other commenters stated that the analysis of the impact on the sector's generating capacity supports the agency's finding. Commenters noted that retirement decisions are based on consideration of numerous factors (
One commenter noted that the EPA's modeling and analysis in the MATS RIA provides the best estimate of the impact of MATS on retirements and stated that the fact that retirements have been higher than projected does not suggest that they were a result of MATS, much less that the EPA erred in concluding that the retirement of 4.7 gigawatts (GW) of generation capacity would be a reasonable burden for the electric power industry to bear. Commenters stated that the EPA's resource adequacy analyses showed that reserve margins can be maintained while the power sector complies with MATS and supports the agency's determination that MATS compliance costs are reasonable.
As some commenters highlighted, the EPA's proposed supplemental finding indicates that the vast majority of the generation capacity in the power sector directly affected by the requirements of MATS would be able to absorb the anticipated compliance costs and remain operational. The EPA's analysis conducted in conjunction with promulgation of the final rule demonstrated the feasibility of installing the retrofit controls projected by the EPA.
Additionally, in order to ensure that any retirements resulting from MATS would not adversely impact the ability of the power sector to meet the demand for electricity, the EPA conducted a regional analysis of the impacts of projected retirements on electric reliability. This resource adequacy analysis looked at capacity projections in each of the 32 modeled subregions in the contiguous U.S. and demonstrated that, with the addition of very little new capacity, average reserve margins are significantly higher than required.
With regard to commenters' assertion that the impacts on reliability alone are not a measure of whether a rule's compliance costs are reasonable, given Congress' overall goal of maintaining the nation's productive capacity, it is reasonable for the EPA to consider such impacts as part of its consideration of costs under CAA section 112(n)(1)(A). The potential impact of MATS on reliability was one of a series of independent analyses, each supporting conclusions that the costs of MATS are reasonable.
Other commenters, however, argued that the EPA must conduct a monetized benefit-cost analysis to support the appropriate and necessary finding and that the agency may not include monetized co-benefits in such an analysis. These commenters argued that the plain language of CAA section 112(n)(1)(A) establishes that a finding of
One commenter also maintains that the EPA claims that Congress intended for the agency to take into account criteria pollutant co-benefits in shaping HAP regulation of EGUs under CAA section 112 and argues such a position is a logical fallacy.
Several commenters asserted that considering co-benefits circumvents the established regulatory framework of the CAA. These comments state that criteria pollutant emissions, like PM, are to be addressed through the national ambient air quality standards (“NAAQS”) program under CAA section 109. These commenters argued that PM co-benefits are irrelevant to the “appropriate” determination and that reliance on criteria pollutant emission reductions in this determination is an impermissible “end run” around the NAAQS program. Several commenters asserted that the EPA double-counts the co-benefits of MATS because the criteria pollutant emissions reductions should be attributable to other regulations, such as the PM NAAQS or the Cross-State Air Pollution Rule.
One commenter noted that although consideration of co-benefits in a benefit-cost analysis is fully consistent with economic principles and guidance documents, it is irrelevant to the decision about whether or not to regulate EGUs that co-benefit reductions are a direct consequence (or even an indirect consequence or mere chance relation) to HAP reductions. The commenter also asserted that the EPA's reliance on OMB guidance (OMB, 2003) is misplaced because the RIA benefit-cost analysis seeks to achieve a different purpose than is required for determining whether regulating HAP from EGUs is appropriate.
The commenters disagreeing with the inclusion of co-benefits assert that when co-benefits associated with PM
As discussed in this response, the EPA included the air quality co-benefits associated with reductions in PM
As an initial matter, the Supreme Court left it to the agency to determine a reasonable approach to considering costs in the finding, and the Court explicitly declined to address whether it would be reasonable to consider monetized co-benefits in evaluating the cost of the rule.
In light of the requirement to consider the co-benefits of other CAA programs, the EPA believes that it is reasonable to conclude that the CAA would also allow the EPA to consider other pollutant reductions directly resulting from regulation of HAP emissions if a monetized benefit-cost analysis were required (or used as a means of considering cost at the agency's discretion) to support the appropriate and necessary finding. In addition, in the legislative history to CAA section 112(d)(2), the Senate Report recognized that MACT standards would have a collateral benefit of controlling criteria pollutants as well and viewed this as an important benefit of the air toxics program. See S. Rep. No. 101-228, 101st Cong. 1st sess. at 172; Legal Memorandum, page 25.
Even if one were to disagree that CAA section 112(n)(1)(A) and the legislative history expressly support our consideration of monetized co-benefits, nothing in the CAA, or the supporting legislative history, suggests that benefits associated with pollutants other than the targeted pollutants are irrelevant to a benefit-cost analysis or must be ignored by the EPA in this context. There is no statutory provision prohibiting consideration of direct co-benefits. The EPA believes that, consistent with economic principles and best practices regarding benefit-cost analysis and the fundamental linkages between reducing HAP emissions and reducing SO
The EPA further notes that consideration of co-benefits is also consistent with economic principles and best practices, executive guidance on regulatory review, and longstanding agency practice under administrations of both parties. Commenters argued, on the one hand, that the EPA is required to undertake a formal benefit-cost analysis to support the finding. At the same time, commenters contend that the agency cannot follow standard economic principles when undertaking such an analysis in this context. The EPA agrees that a formal benefit-cost analysis is not the preferred way of analyzing cost under CAA section 112(n)(1). However, if a benefit-cost analysis is to be undertaken, and relied on, to support the finding, it should be conducted following standard economic principles. Commenters' argument that these principles should not be followed in this context undermines their argument that such a formal benefit-cost analysis is required. The EPA followed well-established principles for conducting such an analysis in the MATS RIA. Consistent with standard practice, the benefit-cost analysis for MATS accounted for all of the significant consequences of a policy decision (
As noted in the proposed supplemental finding (80 FR 75039), the agency is directed to include ancillary benefits in benefit-cost analysis by economic guidance documents from OMB (2003)
In conducting benefit-cost analyses, the EPA routinely considers consequences (both positive and negative) that are ancillary to the intended purpose of a regulation. For example, the $9.6 billion cost estimated in the MATS RIA included costs that would be passed on to electricity customers and higher fuel costs, which are beyond the costs borne by owners of coal- and oil-fired units regulated by
Because controlling HAP emissions necessarily results in fewer emissions of other non-HAP pollutants, the economic value of these consequences (
The EPA also disagrees with commenters' contentions that it is inappropriate for the EPA to consider co-benefits from reducing criteria pollutants below the level established in the NAAQS program. The EPA believes that the commenters mischaracterized the NAAQS program. As the EPA has consistently stated, the NAAQS are not zero-risk standards.
U.S. EPA. 2010.
The EPA further disagrees that the monetized PM
In conclusion, for all of the reasons stated above, it is appropriate for the benefit-cost analysis to consider co-benefits, which are a direct consequence of actions to reduce HAP emissions. It is consistent with economic guidance documents and best practices to include such benefits in a formal benefit-cost analysis. The inclusion of such benefits is consistent with the underlying science. In addition, including such benefits is consistent with statutory requirements in CAA section 112(n)(1)(A) and the legislative history for the CAA section 112(d) maximum achievable control technology or MACT program. The final MATS RIA demonstrates that the quantified and monetized benefits and the unquantified benefits of the rule significantly outweighed the costs of the rule; thus, that analysis fully and independently supports the EPA's determination that it is appropriate to regulate HAP emissions from EGUs.
Rice, Glenn E, James K Hammitt, and John S Evans. 2010. “A Probabilistic Characterization of the Health Benefits of Reducing Methyl Mercury Intake in the United States.”
NESCAUM. 2005.
Castro, M.S. and J. Sherwell. 2015. “Effectiveness of emission controls to reduce the atmospheric concentrations of mercury.”
Drevnick, P.E.,
Hutcheson, M.S.,
Cross, F.A.,
Several commenters agreed that consideration of unquantified benefits is appropriate and consistent with economic principles and best practices, executive guidance on regulatory review, and longstanding EPA practice under administrations of both parties. These commenters noted that it is important to account for the full range of benefits associated with the action, including benefits that cannot be monetized due to lack of data. For example, several commenters noted that the monetized mercury benefits in the MATS RIA did not capture the breadth and severity of the hazards that mercury poses to wildlife and the ecosystem services that wildlife provides, including benefits to fish, sensitive bird species, marine mammals, and amphibian populations. Several commenters asserted that because the monetized benefits in the MATS RIA do not cover all of the benefits from reducing HAP emitted from power plants, a formal benefit-cost comparison is incomplete and potentially misleading. However, these commenters concluded that recent scientific findings on the quantified and unquantified benefits of reducing HAP exposure supports the EPA's determination that it is appropriate to regulate HAP from power plants after considering the costs.
However, numerous other commenters asserted that the $4 to $6 million in monetized mercury benefits in the RIA were the only real benefits attributable to MATS, and thus the rule is not justified because these small benefits do not exceed the projected $9.6 billion in costs.
Further, the EPA agrees with the commenters stating that the monetized mercury health benefits in the MATS RIA significantly underestimate the HAP health benefits associated with MATS. In the MATS RIA, the EPA could only quantify and monetize a small subset of the health and environmental benefits attributable to reducing mercury and none of the health and environmental benefits attributable to reductions in other HAP. As noted in the proposed supplemental finding (80 FR 75040), the monetized mercury benefits did not account for “(1) benefits from reducing adverse health effects on brain and nervous system development beyond IQ loss; (2) benefits for consumers of commercial (store-bought) fish (
The EPA also agrees that consideration of unquantified benefits is appropriate and consistent with economic principles and best practices, executive guidance on regulatory review, and longstanding EPA practice. The EPA agrees that it is important to recognize the full range of impacts associated with an action in a benefit-cost analysis, including those impacts that cannot be quantified or monetized due to a lack of data, for which the MATS RIA accounted qualitatively.
Although the MATS RIA did not quantify and monetize all of the benefits that would result from reducing HAP emissions, the EPA maintains that the benefits of this rule (both quantified and unquantified) are substantial and far outweigh the costs, which independently supports the determination that regulating HAP emissions from EGUs is appropriate.
For example, these commenters asserted the Supreme Court's decision in
As support for their positions, commenters point to the Supreme Court's
Some commenters also challenged the EPA's prior findings that HAP emissions from EGUs pose hazards to public health and the environment, specifically the findings for mercury, non-mercury metal HAP, and acid gas HAP. Some of these commenters also acknowledged that the Supreme Court only addressed the requirement to consider the cost of regulation in the threshold finding and did not disturb any other findings or legal conclusions in the MATS rule or the
The same commenters also argued that the EPA must evaluate the cost of regulating each HAP individually and may only regulate those HAP for which a specific finding is made and then only to the level of regulation that is required to address the identified risk. The commenters maintained that the EPA must separately consider the cost of regulation of each HAP emitted by EGUs under various approaches (as identified above) before regulating any of the HAP at all, and certainly before regulating all the EGU HAP under CAA section 112(d).
Commenters also argued that CAA section 112(n)(1)(A) is not a listing provision as the EPA states in the proposal. Legal Memorandum Accompanying at 2, 11-12. The commenters argued that CAA section 112(n)(1)(A) does not mention listing because listing is only a precondition to regulation under CAA section 112(d), and that the EPA was not required or even authorized to regulate EGUs under that subsection. The commenters asserted that whether to list EGUs is not the question raised by CAA section 112(n)(1)(A). Instead, the commenters asserted, the question is whether additional regulation of EGU HAP emissions under CAA section 112 is “appropriate and necessary.” The commenters argued that the statutory question calls for a decision to authorize or to preclude specific regulation of EGU HAP emissions under CAA section 112. One commenter further asserted that the Supreme Court's opinion in
Commenters further maintained that CAA section 112(n)(1)(A) requires the EPA to decide whether regulation of HAP emissions from EGUs “under this section” is “appropriate and necessary” after considering a study that addresses “hazards to public health” that remain “after imposition of the requirements of this chapter,” and “alternative control strategies for emissions which may warrant regulation.” Commenters characterized the EPA's first task as a requirement to find whether a residual public health hazard is posed by specific EGU HAP emissions remaining after those emissions have been reduced under other provisions of the Act. Commenters also asserted that, if the EPA finds that any remaining EGU HAP emissions pose a hazard, then the EPA must determine how and ultimately whether to regulate those emissions “under this section [112].” Commenters argued that the EPA must therefore calculate a “preliminary estimate” of the costs of the specific form of CAA section 112 regulation that it is considering. Commenters also maintained that the EPA's interpretation of the statute—which the commenters characterized as mandating regulation under CAA section 112(d) if the EPA finds that one HAP emitted by one EGU is found to pose either a residual health or environmental risk—is no longer valid because of the
Commenters also asserted that CAA section 112(n)(1)(A) is, on its face, a residual risk regulatory provision and, as such, it requires the EPA to make a risk management decision regarding whether health risks exist, and if so, the degree to which they need to be reduced further. The commenters maintained that regulation must necessarily depend on what remaining risks, if any, are identified, that certain HAP should only be regulated to the extent necessary to address the risks and only if the monetized HAP-specific benefits exceed the costs of standards, and that the EPA must undertake this analysis before regulating each HAP individually. Commenters asserted that the statute allows the EPA to regulate only those HAP from EGUs that do pose some risk, and then only to the extent “appropriate” (from a cost point of view) and “necessary” (from a risk reduction point of view). The commenters argued that the EPA's approach impermissibly uses the risk allegedly associated with one HAP to regulate another HAP. The commenters maintain that the EPA must instead evaluate different regulatory approaches available to it in order to determine costs and benefits on an individual HAP basis. The commenters concluded that the EPA cannot interpret the statute to permit regulation of all HAP under CAA section 112(d)(2)-(3) because that approach results in high HAP control
For acid gas HAP, the commenters appear to maintain that the EPA could potentially use CAA section 112(d) to regulate, but that the nature of such regulation must change to satisfy the
These comments focus on several primary arguments: (1) The
Many of the comments in opposition to the EPA's interpretation of the statute are largely, if not wholly, premised on the position that the Supreme Court's decision in
We note that many of the commenters opposed to the proposed supplemental finding were parties to the
In sum, the
Furthermore, while not expressly stated, the commenters appear to assume that the EPA could never justify the cost of the MATS rule and that no analysis of whether the costs of the rule are reasonable would even be relevant. The Administrator disagrees and believes the EPA should evaluate and consider the cost of the MATS rule. Furthermore, having concluded that the cost of MATS is reasonable under several metrics and that the rule will not impair the ability of the industry to provide reliable electricity, the Administrator believes she must consider those conclusions. In light of those conclusions and the findings that HAP emissions pose significant hazards to public health and the environment that will not be addressed through imposition of the other requirements of the CAA, the Administrator concludes in this final notice that regulation is appropriate and necessary.
The EPA's approach to evaluating cost is also supported by the
The agency has reversed its prior conclusion that cost need not be considered when making an appropriate and necessary finding and adopted a new interpretation of the role of cost in that finding. That new interpretation is consistent with the
The EPA discussed the
As background, the EPA issued MATS in response to the
The EPA recognized in MATS that it must reevaluate the prior interpretations of the statute and the technical findings concerning the hazards to public health from HAP emissions from EGUs as part
Under the commenters' approaches, the EPA would be required to make specific separate cost findings for each HAP, but only if the EPA has determined that the HAP at issue poses a hazard to public health (not the environment). The commenters argued that the
The rationale for these conclusions is valid and in no way undermined by the conclusion that the EPA must incorporate cost considerations into the appropriate and necessary finding. The EPA stated in MATS that “the use of the terms section, subsection, and subparagraph in section 112(n)(1)(A) demonstrates that Congress was consciously distinguishing the various provisions of section 112 in directing EPA's action under section 112(n)(1)(A). Congress directed the agency to regulate utilities “under this section” not “under this subparagraph [112(n)],” and accordingly EGUs should be regulated under section 112 in the same manner as other categories for which the statute requires regulation.”
During the MATS rulemaking, the EPA explicitly considered and rejected comments suggesting that the agency could regulate under CAA section 112(n)(1), and neither the EPA's conclusion nor its rationale are affected by the
The
EPA acted properly in regulating EGUs under § 112(d). Section 112(n)(1)(A) directs the Administrator to “regulate electric steam generating units under this section, if the Administrator finds such regulation is appropriate and necessary.” CAA § 112(n)(1)(A). EPA reasonably interprets the phrase “under this section” to refer to the entirety of
The
Although the petitioners attempt to distinguish
There is no basis for commenters' assertion that these interpretations are rendered unreasonable or otherwise invalid by the requirement that the EPA consider cost as part of the appropriate and necessary determination. Moreover, the agency's incorporation of a consideration of cost into the prior interpretation is reasonable, supported by the statutory text and context of the provision, and consistent with the purpose of the statute.
As explained above, commenters maintain that listing under CAA section 112(c) and regulation under CAA section 112(d) is not reasonable for EGUs and that the EPA must instead look to other provisions of the statute to develop a regulatory approach that is only as costly as necessary to address specifically identified hazards to public health (hazards to the environment would not be sufficient to justify regulation of any HAP according to many commenters opposed to the agency's interpretation). The commenters point to various provisions including CAA sections 112(n)(1), 112(f), and 111(d), and to the potential for state action,
As an initial matter, the commenters do not suggest a clear framework for developing standards under those alternative approaches and the statute does not provide one. The D.C. Circuit stated that the EPA is not required to adopt a “hypothetical framework not elaborated in the statute”; thus, even if HAP emissions could theoretically be regulated under the alternative provisions of the CAA identified by the comments, the agency could reasonably decline to adopt those alternative approaches in lieu of the reasonable approach affirmed in
The lack of a statutory framework for the alternative approaches suggested by commenters would frustrate if not wholly undermine the agency's ability to achieve prompt, permanent and ongoing reductions in HAP emissions from EGUs after completion of the studies, thus unduly frustrating the purpose of CAA section 112. As the EPA explained in the Legal Memorandum, CAA section 112(n)(1) required the agency to conduct the three studies that Congress thought most relevant to a determination of whether to regulate HAP emissions from EGUs within 4 years of the 1990 amendments to ensure that the EPA would have the information required to make the appropriate and necessary finding. Legal Memorandum at 13-18. The EPA maintains that this direction ensured that the agency could list and regulate HAP emissions from EGUs if warranted. Conversely, the commenters' different and supposedly mandated approaches would make it virtually impossible to obtain prompt reductions in HAP emissions,
We next address the commenters' assertion that the EPA could regulate under CAA section 112(f) and that such an approach is proper because CAA section 112(n)(1)(A) is a residual risk provision.
Commenters' challenges based on the legislative history are equally misplaced. The EPA has reviewed the legislative history cited by the commenters and the agency does not agree that it mandates or even supports the commenters' assertions concerning the proper consideration of cost. Commenters on the MATS rule used much of the same legislative history to argue against the non-cost related aspects of EPA's interpretation of CAA section 112(n)(1)(A), and the agency explained why the legislative history did not undermine the EPA's interpretation or compel a different approach.
Commenters also argue that the direction to conduct the Utility Study in CAA section 112(n)(1)(A) required the agency to consider regulation of HAP under other CAA authorities and that the agency incorrectly interpreted the scope of the study. Specifically, the commenters assert that the requirement to “develop and describe . . . alternative control strategies” for HAP emissions was a requirement to devise alternative regulatory approaches (other than CAA section 112(d)) for reducing HAP emissions from EGUs and further required the agency to evaluate the comparative cost of the different approaches. The commenters argue that if the EPA had done what it was “supposed” to do in the study, it would have had the information commenters maintain is necessary to properly consider cost. The commenters' argument is flawed for several reasons. First, a natural reading of the statute does not support the type of analysis the commenters suggest is mandated and the legislative history does not support that conclusion either. In addition, the EPA completed the Utility Study in 1998 and to comply with the requirement to consider alternative control strategies the agency considered mechanisms to reduce HAP from EGUs before, during, and after combustion.
The commenters challenge either expressly or impliedly the legal and technical bases on which the agency determined that HAP emissions from EGUs pose hazards to public health and
As to the consideration of environmental harms and the 1-in-1 million standard, the
Commenters note that the
Concerning the consideration of the volume of HAP emissions in the appropriate finding, the EPA explained in the Legal Memorandum why volume of HAP is relevant to the appropriate finding because one of the goals of the CAA is to obtain permanent reductions in the volume of HAP emissions from major stationary sources.
The EPA also disagrees with commenters' assertion that the acid gas HAP that are emitted from EGUs do not warrant regulation under CAA section 112. CAA Section 112(b) identifies the HAP that Congress determined warrant regulation under CAA section 112. Congress also provided a mechanism to remove pollutants from the CAA section 112(b) list.
Finally, the agency also does not agree that it may establish a standard under CAA section 112(d)(4), which allows the agency to factor health thresholds into its decisions on standards in cases where health thresholds have been established for pollutants, simply based on cost and the
Because of the limited nature of the Supreme Court's remand, the EPA only solicited comments on its consideration of cost in its proposal reaffirming the appropriate determination. We explained that analyses presented in the proposed notice and in the accompanying Legal Memorandum did not affect or alter other aspects of the appropriate and necessary interpretation or finding or the CAA section 112(d) emission standards promulgated in MATS. The EPA also clearly explained that the analyses in the proposed supplemental finding did not, in any way, alter the RIA prepared for the final MATS.
Therefore, we clearly stated that we would not accept comment on the scientific or technical aspects of the prior findings or the analyses supporting our conclusions regarding the hazards to public health and environmental benefits from HAP emissions from EGUs. These findings include that mercury and other HAP emissions pose significant hazards to public health and the environment, that EGUs are the largest emitter of many HAP, that effective control strategies for HAP emissions are available, and that HAP hazards remain after implementation of other CAA provisions.
The EPA did not open for comment or propose to revise any other aspects of the appropriate and necessary interpretation or finding, or the MATS standards themselves, as part of the proposed action. The final MATS standards were supported by an extensive administrative record and based on available control technologies and other practices already used by the better-controlled and lower-emitting EGUs, and the EPA previously concluded that the standards are achievable and reduce hazards to public health and the environment from HAP emitted by EGUs. 76 FR 24976 (MATS proposal); 77 FR 9304 (MATS final). Further, the public had ample opportunity to comment on all aspects of the CAA section 112(d) standards, the RIA, and the appropriate and necessary finding beyond the consideration of cost; and the EPA responded to all of the significant comments.
The Supreme Court's decision in
The EPA further clarified that reference or citation to any final decision, interpretation, or conclusion in the MATS record does not constitute a re-opening of the issue or an invitation to comment on the underlying decision in which the EPA considered some cost of MATS (
Despite the very clear direction that the EPA provided in the proposal and solicitation, numerous commenters submitted comments that were beyond the limited scope identified in the proposed supplemental finding. In many cases, the submissions contained comments on issues that the EPA had considered in Petitions for Reconsideration (80 FR 24218) or that had been upheld in
Additional information about these statues and Executive Orders can be found at
This action is a significant regulatory action that was submitted to OMB for review because it “raises novel legal or policy issues arising out of legal mandates.” Any changes made in response to OMB recommendations have been documented in the docket. The EPA does not project any incremental costs or benefits associated with this supplemental finding because this action does not impose standards or other requirements on affected sources.
This action does not impose an information collection burden under the PRA. There are no information collection requirements in this action.
I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA. This action will not impose any requirements on small entities. The EPA does not project any incremental costs or benefits associated with this supplemental finding because this action does not impose standards or other requirements on affected sources.
This action does not contain any unfunded mandate as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local, or tribal governments or the private sector.
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. It would neither impose substantial direct compliance costs on tribal governments, nor preempt Tribal law. Thus, Executive Order 13175 does not apply to this action.
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 a “significant energy action” because it is not likely to have a significant adverse effect on the supply, distribution, or use of energy. This action is not anticipated to have notable impacts on emissions, costs, or energy supply decisions for the affected electric utility industry as this action does not impose standards or other requirements on affected sources.
This action does not involve technical standards.
The EPA believes the human health or environmental risk addressed by this action will not have potential disproportionately high and adverse human health or environmental effects on minority, low-income, or indigenous populations because it is limited in scope and only considers the cost of whether it is appropriate to regulate HAP emissions from EGUs.
This action is subject to the CRA, and the EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. This action is not a “major rule” as defined by 5 U.S.C. 804(2).
Pursuant to CAA section 307(d)(1)(V), the Administrator determines that this action is subject to provisions of section 307(d). Section 307(d) establishes procedural requirements specific to rulemaking under the CAA. CAA section 307(d)(1)(V) provides that the provisions of CAA section 307(d) apply
The statutory authority for this proposed action is provided by sections 112, 301, 302, and 307(d)(1) of the CAA as amended (42 U.S.C. 7412, 7601, 7602, 7607(d)(1)). This action is also subject to section 307(d) of the CAA (42 U.S.C. 7607(d)).
Category | Regulatory Information | |
Collection | Federal Register | |
sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
Publisher | Office of the Federal Register, National Archives and Records Administration |