Federal Register Vol. 82, No.102,

Federal Register Volume 82, Issue 102 (May 30, 2017)

Page Range24455-24821
FR Document

82_FR_102
Current View
Page and SubjectPDF
82 FR 24740 - Sunshine Act Notice; Matter to be Deleted From the Agenda of a Previously Announced Agency MeetingPDF
82 FR 24654 - Endangered and Threatened Wildlife and Plants; Endangered Species Status for the Texas HornshellPDF
82 FR 24775 - Sunshine Act Meeting; Unified Carrier Registration Plan Board of DirectorsPDF
82 FR 24737 - Sunshine Act MeetingPDF
82 FR 24703 - Request for Nominations of Experts to the EPA Office of Research and Development's Board of Scientific Counselors; CorrectionPDF
82 FR 24695 - Applications for New Awards; Education Research and Special Education Research Grant ProgramsPDF
82 FR 24690 - Defense Health Board; Notice of Federal Advisory Committee MeetingPDF
82 FR 24688 - Agency Information Collection Activities: Extension of Information Collections Under the Dodd-Frank ActPDF
82 FR 24739 - Records Schedules; Availability and Request for CommentsPDF
82 FR 24693 - Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Comment Request; Annual Vocational Rehabilitation Program/Cost Report (RSA-2)PDF
82 FR 24692 - Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Comment Request; IDEA Part B State Performance Plan (SPP) and Annual Performance Report (APR)PDF
82 FR 24694 - Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Comment Request; IDEA Part C State Performance Plan (SPP) and Annual Performance Report (APR)PDF
82 FR 24704 - Agency Information Collection Activities: Proposed Collection; Comment RequestPDF
82 FR 24705 - Agency Information Collection Activities: Proposed Collection: Generic Clearance for the Collection of Qualitative Feedback on Agency Service DeliveryPDF
82 FR 24725 - National Institute of Neurological Disorders and Stroke; Notice of Closed MeetingsPDF
82 FR 24727 - National Institute of Dental & Craniofacial Research Notice of Closed MeetingsPDF
82 FR 24727 - National Institute of Allergy and Infectious Diseases; Notice of Closed MeetingPDF
82 FR 24726 - Center for Scientific Review; Notice of Closed MeetingsPDF
82 FR 24728 - Center For Scientific Review Notice of Closed MeetingsPDF
82 FR 24737 - Records Schedules; Availability and Request for CommentsPDF
82 FR 24677 - Malleable Cast Iron Pipe Fittings From the People's Republic of China: Notice of Rescission of the Antidumping Duty Administrative Review; 2015-2016PDF
82 FR 24775 - Agency Request for Regular Processing of Collection of Information by the Office of Management and BudgetPDF
82 FR 24731 - Agency Information Collection Activities: Proposed Collection; Comment Request, Federal Assistance to Individuals and Households Program, (IHP).PDF
82 FR 24730 - Agency Information Collection Activities: Proposed Collection; Comment Request; Disaster Assistance RegistrationPDF
82 FR 24702 - Agency Information Collection Activities; Proposed Renewal of an Existing Collection; Comment RequestPDF
82 FR 24561 - Capital Construction Fund; Fishing Vessel Capital Construction Fund ProceduresPDF
82 FR 24771 - Agency Information Collection Activities: Requests for Comments; Clearance of Renewed Approval of Information Collection: Extended Operations (ETOPS) of Multi-Engine AirplanesPDF
82 FR 24746 - Advisory Committee on Reactor Safeguards (ACRS) Meeting of the ACRS Subcommittee on APR1400; Notice of MeetingPDF
82 FR 24679 - Advisory Committee on Supply Chain Competitiveness: Notice of Public MeetingsPDF
82 FR 24458 - Special Conditions: Bell Helicopter Textron Inc. (Bell) Model 412EP Helicopter in the 412 EPI Configuration; Search and Rescue (SAR) With Automatic Flight Control System (AFCS) InstallationPDF
82 FR 24740 - Health Information Technology Research and Development (HITRD) Interagency Working Group (IWG)PDF
82 FR 24770 - Noise Exposure Map Notice for John F. Kennedy International Airport, New York City, New YorkPDF
82 FR 24773 - Aviation Rulemaking Advisory Committee Teleconference on Transport Airplane and Engine IssuesPDF
82 FR 24774 - Agency Information Collection Activities: Emergency Approval Request for a New Information Collection.PDF
82 FR 24773 - Agency Information Collection Activities: Request for Comments for a New Information CollectionPDF
82 FR 24457 - List of Approved Spent Fuel Storage Casks: TN Americas, LLC, NUHOMS® EOS Dry Spent Fuel Storage System, Certificate of Compliance No. 1042PDF
82 FR 24732 - Agency Information Collection Activities: OMB Control Number 1018-0022; Federal Fish and Wildlife Permit Applications and Reports-Migratory Birds and EaglesPDF
82 FR 24704 - Notice to All Interested Parties of the Termination of the Receivership of 10086-Security Bank of Gwinnett County, Suwanee, GeorgiaPDF
82 FR 24773 - Agency Information Collection Activities: Requests for Comments; Clearance of Renewed Approval of Information Collection: Automatic Domestic and International Flight PlansPDF
82 FR 24769 - Agency Information Collection Activities: Requests for Comments; Clearance of Renewed Approval of Information Collection: Representatives of the AdministratorPDF
82 FR 24771 - Agency Information Collection Activities: Requests for Comments; Clearance of Renewed Approval of Information Collection: Automatic Certification and Operation FAR 125PDF
82 FR 24569 - Fisheries of the Northeastern United States; Northeast Multispecies Fishery; American Plaice Trimester Total Allowable Catch Area Closure for the Common Pool FisheryPDF
82 FR 24651 - Evaluation of Existing Federal Management and Federal Property Management RegulationsPDF
82 FR 24521 - Inflation Catch-Up Adjustment of Civil Monetary Penalty Amounts Final Rule and Adjustment of Civil Monetary Penalty Amounts for 2017PDF
82 FR 24652 - 41 CFR Subtitle F-Federal Travel Regulation System Evaluation of Existing Federal Travel RegulationsPDF
82 FR 24782 - Solicitation of Nominations for Appointment to the MyVA Advisory CommitteePDF
82 FR 24675 - Certain Cased Pencils From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2014-2015PDF
82 FR 24653 - Evaluation of Existing Acquisition RegulationsPDF
82 FR 24652 - Evaluation of Existing Leasing Acquisition RegulationsPDF
82 FR 24692 - Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and Approval; Comment Request; Historically Black Colleges and Universities Master's Degree ProgramPDF
82 FR 24673 - Notice of Public Meeting of the Oregon Advisory CommitteePDF
82 FR 24674 - Notice of Public Meeting of the Nevada State Advisory CommitteePDF
82 FR 24674 - Notice of Public Meeting of the Alaska Advisory CommitteePDF
82 FR 24694 - Agency Information Collection Activities; Submission to the Office of Management and Budget for Review and approval; Comment Request; School Survey on Crime and Safety (SSOCS) 2018 and 2020PDF
82 FR 24786 - Migratory Bird Hunting; Final Frameworks for Migratory Bird Hunting RegulationsPDF
82 FR 24667 - Agency Information Collection Activities: Proposed Collection; Comment Request-Study of School Food Authority (SFA) Procurement PracticesPDF
82 FR 24746 - Exelon Generation Company, LLC; Nine Mile Point Nuclear Station, Units 1 and 2PDF
82 FR 24742 - Exelon Generation Company, LLC; James A. FitzPatrick Nuclear Power PlantPDF
82 FR 24704 - Formations of, Acquisitions by, and Mergers of Bank Holding CompaniesPDF
82 FR 24679 - Takes of Marine Mammals Incidental to Specified Activities; U.S. Navy Training Activities in the Gulf of Alaska Temporary Maritime Activities AreaPDF
82 FR 24681 - Takes of Marine Mammals Incidental to Specified Activities; Gull Monitoring and Research in Glacier Bay National Park, Alaska, 2017PDF
82 FR 24560 - Procedures for Paper Filings and Collecting Application and Regulatory FeesPDF
82 FR 24737 - Notice of Lodging Proposed Stipulation and OrderPDF
82 FR 24656 - Fisheries Off West Coast States; Coastal Pelagic Species Fisheries; Annual SpecificationsPDF
82 FR 24720 - Pediatric Oncology Subcommittee of the Oncologic Drugs Advisory Committee; Notice of Meeting; Establishment of a Public Docket; Request for CommentsPDF
82 FR 24659 - Agency Information Collection Activities: Proposed Collection; Comment Request-Assessment of States' Use of Computer Matching Protocols in SNAPPDF
82 FR 24664 - Agency Information Collection Activities, Comments Request: Evaluation of Alternatives To Improve Elderly AccessPDF
82 FR 24745 - Patient Release ProgramPDF
82 FR 24525 - Safety Zone; Buffalo Carnival; Buffalo Outer Harbor, Buffalo, NYPDF
82 FR 24778 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel TWANOH; Invitation for Public CommentsPDF
82 FR 24779 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel SOMEWHERE; Invitation for Public CommentsPDF
82 FR 24780 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel SEDNA; Invitation for Public CommentsPDF
82 FR 24780 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel RESOLUTE; Invitation for Public CommentsPDF
82 FR 24779 - Requested Administrative Waiver of the Coastwise Trade Laws: Vessel COYOTE; Invitation for Public CommentsPDF
82 FR 24711 - Proposed Data Collection Submitted for Public Comment and RecommendationsPDF
82 FR 24709 - Proposed Data Collection Submitted for Public Comment and RecommendationsPDF
82 FR 24707 - Proposed Data Collection Submitted for Public Comment and RecommendationsPDF
82 FR 24706 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
82 FR 24783 - Agency Information Collection Activity: Vocational Rehabilitation and Employment (VR&E) Longitudinal Study SurveyPDF
82 FR 24772 - Petition for Exemption; Summary of Petition ReceivedPDF
82 FR 24479 - RecordkeepingPDF
82 FR 24691 - Judicial Proceedings Since Fiscal Year 2012 Amendments Panel; Notice of Federal Advisory Committee MeetingPDF
82 FR 24722 - Agency Information Collection Activities; Announcement of Office of Management and Budget ApprovalsPDF
82 FR 24611 - BASF Corp.; Filing of Food Additive Petition (Animal Use)PDF
82 FR 24718 - Agency Information Collection Activities; Proposed Collection; Comment Request; Submission of Petitions: Food Additive, Color Additive (Including Labeling), Submission of Information to a Master File in Support of Petitions; and Electronic Submission Using Food and Drug Administration Form 3503PDF
82 FR 24723 - Agency Information Collection Activities; Proposed Collection; Comment Request; Additional Criteria and Procedures for Classifying Over-the-Counter Drugs as Generally Recognized as Safe and Effective and Not MisbrandedPDF
82 FR 24715 - Proposed Information Collection Activity; Comment RequestPDF
82 FR 24678 - Renewable Energy and Energy Efficiency Advisory CommitteePDF
82 FR 24677 - Renewable Energy and Energy Efficiency Advisory CommitteePDF
82 FR 24583 - Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order; De Minimis Quantity Exemption ThresholdPDF
82 FR 24671 - Opportunity for Designation in the Aberdeen Area; Request for Comments on the Official Agency Servicing This AreaPDF
82 FR 24726 - National Heart, Lung, and Blood Institute Notice of Closed MeetingPDF
82 FR 24725 - National Heart, Lung, and Blood Institute Notice of Closed MeetingPDF
82 FR 24727 - National Heart, Lung, and Blood Institute; Notice of Closed MeetingPDF
82 FR 24725 - National Heart, Lung, and Blood Institute; Notice of Closed MeetingsPDF
82 FR 24726 - National Center for Advancing Translational Sciences; Notice of Closed MeetingPDF
82 FR 24714 - Proposed Information Collection Activity; Comment RequestPDF
82 FR 24729 - Center for Substance Abuse Prevention; Notice of MeetingPDF
82 FR 24672 - Opportunity for Designation in the Hastings Area; Request for Comments on the Official Agency Servicing This AreaPDF
82 FR 24659 - Notice of Meeting of the National Organic Standards BoardPDF
82 FR 24455 - Beef Promotion and Research Rules and RegulationsPDF
82 FR 24766 - Oklahoma Disaster #OK-00113PDF
82 FR 24761 - Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding the Opening ProcessPDF
82 FR 24764 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Change To Amend the Rules of the Exchange, the NYSE MKT Equities Price List, the NYSE Amex Options Fee Schedule, and the NYSE Amex Options Proprietary Market Data FeesPDF
82 FR 24716 - Agency Information Collection Activities; Proposed Collection; Comment Request; Electronic Submission Process for Voluntary Allegations to the Center for Devices and Radiological HealthPDF
82 FR 24717 - Vaccines and Related Biological Products Advisory Committee; Notice of MeetingPDF
82 FR 24751 - Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding the Opening ProcessPDF
82 FR 24763 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Designation of a Longer Period for Commission Action on Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change, as Modified by Amendments No. 1 and 2, Allowing the Exchange To Trade, Pursuant to Unlisted Trading Privileges, Any NMS Stock Listed on Another National Securities Exchange; Establishing Rules for the Trading Pursuant to UTP of Exchange-Traded Products; and Adopting New Equity Trading Rules Relating to Trading Halts of Securities Traded Pursuant to UTP on the Pillar PlatformPDF
82 FR 24755 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Order Granting Approval of a Proposed Rule Change, as Modified by Amendments No. 1 and 2, To List and Trade Shares of the First Trust California Municipal High Income ETFPDF
82 FR 24753 - Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Schedule of Fees To Decrease Member Order Routing Program RebatesPDF
82 FR 24675 - Submission for OMB Review; Comment Request; Generic Clearance for the Collection of Qualitative Feedback on Agency Service DeliveryPDF
82 FR 24611 - Adjustment of Cable Statutory License Royalty RatesPDF
82 FR 24767 - Agency Information Collection Activities: Proposed Request and Comment RequestPDF
82 FR 24750 - Information Collection: “10 CFR Part 35, Medical Use of Byproduct Material”PDF
82 FR 24673 - Agenda and Notice of Public Meeting of the New Hampshire Advisory CommitteePDF
82 FR 24769 - Rescission of Social Security Ruling 91-3p: Policy Interpretation Ruling Title II: Determining Entitlement to Disability Benefits for Months Prior to January 1991 for Widows, Widowers and Surviving Divorced Spouses ClaimsPDF
82 FR 24729 - Request for Applicants for Appointment to the U.S. Customs and Border Protection User Fee Advisory CommitteePDF
82 FR 24781 - Solicitation of Nominations for Appointment to the Veterans' Family, Caregiver, and Survivor Advisory CommitteePDF
82 FR 24671 - Sierra County Resource Advisory CommitteePDF
82 FR 24570 - National Environmental Policy Act Regulations.PDF
82 FR 24621 - Approval and Promulgation of Implementation Plans; Oregon: Permitting and General Rule Revisions; Reopening of Comment PeriodPDF
82 FR 24527 - Determination of Attainment and Approval of Base Year Emissions Inventories for the Imperial County, California Fine Particulate Matter Nonattainment Area; CorrectionPDF
82 FR 24549 - Air Plan Approval; Maryland; Update to Materials Incorporated by ReferencePDF
82 FR 24636 - Air Plan Approval and Air Quality Designation; TN; Redesignation of the Knoxville 1997 Annual PM2.5PDF
82 FR 24614 - Approval and Promulgation of Air Quality Implementation Plans; Maryland; Regional Haze Best Available Retrofit Technology Measure for Verso Luke Paper MillPDF
82 FR 24546 - Approval and Promulgation of Air Quality Implementation Plans; Maryland; Control of Nitrogen Oxide Emissions From Coal-Fired Electric Generating UnitsPDF
82 FR 24529 - Approval and Promulgation of Air Quality Implementation Plans; Delaware; Update to Materials Incorporated by ReferencePDF
82 FR 24617 - Approval and Promulgation of Air Quality Implementation Plans; District of Columbia; Regional Haze Five-Year Progress Report State Implementation PlanPDF
82 FR 24537 - Air Plan Approval; Virginia; Update to Materials Incorporated by ReferencePDF
82 FR 24531 - Air Plan Approval; Washington: General Regulations for Air Pollution Sources, Energy Facility Site Evaluation CouncilPDF
82 FR 24553 - Air Plan Approval; Indiana; Redesignation of the Muncie Area to Attainment of the 2008 Lead StandardPDF
82 FR 24621 - Air Plan Approval and Air Quality Designation; TN; Redesignation of the Knoxville 2006 24-Hour PM2.5PDF
82 FR 24635 - Air Plan Approval; Indiana; Redesignation of the Muncie Area to Attainment of the 2008 Lead StandardPDF
82 FR 24582 - Reducing Regulation and Controlling Regulatory CostsPDF
82 FR 24487 - Whistleblower Awards ProcessPDF
82 FR 24462 - Airworthiness Directives; Learjet, Inc., AirplanesPDF
82 FR 24595 - Airworthiness Directives; The Boeing Company AirplanesPDF
82 FR 24597 - Airworthiness Directives; The Boeing Company AirplanesPDF
82 FR 24606 - Airworthiness Directives; Dassault Aviation AirplanesPDF
82 FR 24603 - Airworthiness Directives; Dassault Aviation AirplanesPDF
82 FR 24601 - Airworthiness Directives; Airbus AirplanesPDF
82 FR 24465 - Airworthiness Directives; British Aerospace Regional Aircraft AirplanesPDF
82 FR 24472 - Airworthiness Directives; ZLIN AIRCRAFT a.s. AirplanesPDF
82 FR 24468 - Airworthiness Directives; The Boeing Company AirplanesPDF
82 FR 24475 - Airworthiness Directives; The Boeing Company AirplanesPDF

Issue

82 102 Tuesday, May 30, 2017 Contents Agency Health Agency for Healthcare Research and Quality NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24704-24705 2017-11099 Agency Information Collection Activities; Proposals, Submissions, and Approvals: Generic Clearance for the Collection of Qualitative Feedback on Agency Service Delivery, 24705-24706 2017-11098 Agricultural Marketing Agricultural Marketing Service RULES Beef Promotion and Research Rules and Regulations, 24455-24457 2017-10986 PROPOSED RULES Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order; De Minimis Quantity Exemption Threshold, 24583-24595 2017-10997 NOTICES Meetings: National Organic Standards Board, 24659 2017-10987 Agriculture Agriculture Department See

Agricultural Marketing Service

See

Food and Nutrition Service

See

Forest Service

See

Grain Inspection, Packers and Stockyards Administration

Centers Disease Centers for Disease Control and Prevention NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24706-24714 2017-11017 2017-11018 2017-11019 2017-11020 Children Children and Families Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24714-24715 2017-10990 2017-11007 Civil Rights Civil Rights Commission NOTICES Meetings: Alaska Advisory Committee, 24674-24675 2017-11044 Nevada State Advisory Committee, 24674 2017-11045 New Hampshire Advisory Committee, 24673 2017-10966 Oregon Advisory Committee, 24673-24674 2017-11046 Coast Guard Coast Guard RULES Safety Zones: Buffalo Carnival; Buffalo Outer Harbor, Buffalo, NY, 24525-24527 2017-11026 Commerce Commerce Department See

International Trade Administration

See

National Oceanic and Atmospheric Administration

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Generic Clearance for the Collection of Qualitative Feedback on Agency Service Delivery, 24675 2017-10971
Commodity Futures Commodity Futures Trading Commission RULES Recordkeeping, 24479-24487 2017-11014 Whistleblower Awards Process, 24487-24521 2017-10801 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24688-24690 2017-11105 Copyright Royalty Board Copyright Royalty Board PROPOSED RULES Adjustment of Cable Statutory License Royalty Rates, 24611-24614 2017-10970 Defense Department Defense Department NOTICES Meetings: Defense Health Board, 24690-24691 2017-11106 Judicial Proceedings Since Fiscal Year 2012 Amendments Panel, 24691-24692 2017-11012 Education Department Education Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Annual Vocational Rehabilitation Program/Cost Report, 24693-24694 2017-11102 Historically Black Colleges and Universities Master's Degree Program, 24692-24693 2017-11047 IDEA Part B State Performance Plan and Annual Performance Report, 24692 2017-11101 IDEA Part C State Performance Plan and Annual Performance Report, 24694 2017-11100 School Survey on Crime and Safety 2018 and 2020, 24694-24695 2017-11043 Applications for New Awards: Education Research and Special Education Research Grant Programs, 24695-24701 2017-11107 Energy Department Energy Department PROPOSED RULES Reducing Regulation and Controlling Regulatory Costs, 24582-24583 2017-10866 Environmental Protection Environmental Protection Agency RULES Air Quality State Implementation Plans; Approvals and Promulgations: California; Determination of Attainment and Approval of Base Year Emissions Inventories for the Imperial County, CA Fine Particulate Matter Nonattainment Area; Correction, 24527-24529 2017-10931 Delaware; Update to Materials Incorporated by Reference, 24529-24531 2017-10911 Indiana; Redesignation of the Muncie Area to Attainment of the 2008 Lead Standard, 24553-24559 2017-10906 Maryland; Control of Nitrogen Oxide Emissions from Coal-Fired Electric Generating Units, 24546-24549 2017-10912 Maryland; Update to Materials Incorporated by Reference, 24549-24552 2017-10915 Virginia; Update to Materials Incorporated by Reference, 24537-24546 2017-10909 Washington; General Regulations for Air Pollution Sources, Energy Facility Site Evaluation Council, 24531-24537 2017-10908 PROPOSED RULES Air Quality State Implementation Plans; Approvals and Promulgations: District of Columbia; Regional Haze Five-Year Progress Report State Implementation Plan, 24617-24621 2017-10910 Indiana; Redesignation of the Muncie Area to Attainment of the 2008 Lead Standard, 24635-24636 2017-10904 Maryland; Regional Haze Best Available Retrofit Technology Measure for Verso Luke Paper Mill, 24614-24617 2017-10913 Oregon; Permitting and General Rule Revisions; Reopening of Comment Period, 24621 2017-10935 Tennessee; Redesignation of the Knoxville 1997 Annual Fine Particulate Matter Nonattainment Area to Attainment, 24636-24651 2017-10914 TN; Redesignation of the Knoxville 2006 24-hour PM2.5 Nonattainment Area to Attainment, 24621-24635 2017-10905 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24702-24703 2017-11086 Requests for Nominations: Office of Research and Development's Board of Scientific Counselors; Correction, 24703-24704 2017-11166 Federal Aviation Federal Aviation Administration RULES Airworthiness Directives: British Aerospace Regional Aircraft Airplanes, 24465-24468 2017-10408 Learjet, Inc., Airplanes, 24462-24465 2017-10786 The Boeing Company Airplanes, 24468-24472, 24475-24479 2017-10286 2017-10288 ZLIN AIRCRAFT a.s. Airplanes, 24472-24475 2017-10406 Special Conditions: Bell Helicopter Textron Inc. (Bell) Model 412EP Helicopter in the 412 EPI Configuration; Search and Rescue (SAR) with Automatic Flight Control System (AFCS) Installation, 24458-24462 2017-11073 PROPOSED RULES Airworthiness Directives: Airbus Airplanes, 24601-24603 2017-10542 Dassault Aviation Airplanes, 24603-24611 2017-10543 2017-10545 The Boeing Company Airplanes, 24595-24600 2017-10604 2017-10606 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Automatic Certification and Operation FAR 125, 24771-24772 2017-11059 Automatic Domestic and International Flight Plans, 24773 2017-11061 Extended Operations of Multi-Engine Airplanes, 24771 2017-11082 Representatives of the Administrator, 24769-24770 2017-11060 Meetings: Aviation Rulemaking Advisory Committee Teleconference on Transport Airplane and Engine Issues, 24773 2017-11067 Noise Exposure Maps: John F. Kennedy International Airport, New York City, NY, 24770-24771 2017-11071 Petitions for Exemption; Summaries, 24772 2017-11015 Federal Communications Federal Communications Commission RULES Procedures for Paper Filings and Collecting Application and Regulatory Fees, 24560-24561 2017-11034 Federal Deposit Federal Deposit Insurance Corporation NOTICES Terminations of Receivership: Security Bank of Gwinnett County Suwanee, GA, 24704 2017-11062 Federal Emergency Federal Emergency Management Agency NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Disaster Assistance Registration, 24730-24731 2017-11088 Federal Assistance to Individuals and Households Program, 24731-24732 2017-11089 Federal Highway Federal Highway Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24773-24774 2017-11065 2017-11066 Federal Motor Federal Motor Carrier Safety Administration NOTICES Meetings; Sunshine Act, 24775 2017-11179 Federal Railroad Federal Railroad Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24775-24778 2017-11090 Federal Reserve Federal Reserve System NOTICES Formations of, Acquisitions by, and Mergers of Bank Holding Companies, 24704 2017-11038 Fish Fish and Wildlife Service RULES Migratory Bird Hunting: Final Frameworks for Regulations, 24786-24821 2017-11042 PROPOSED RULES Endangered and Threatened Species: Endangered Species Status for the Texas Hornshell, 24654-24656 2017-11189 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Federal Fish and Wildlife Permit Applications and Reports—Migratory Birds and Eagles, 24732-24737 2017-11063 Food and Drug Food and Drug Administration PROPOSED RULES Food Additive Petitions: BASF Corp., 24611 2017-11010 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Additional Criteria and Procedures for Classifying Over-the-Counter Drugs as Generally Recognized as Safe and Effective and Not Misbranded, 24723-24725 2017-11008 Announcement of Office of Management and Budget Approvals, 24722 2017-11011 Electronic Submission Process for Voluntary Allegations to the Center for Devices and Radiological Health, 24716-24717 2017-10982 Food Additive, Color Additive (Including Labeling), Submission of Information to a Master File in Support of Petitions; and Electronic Submission Using Food and Drug Administration, 24718-24720 2017-11009 Meetings: Pediatric Oncology Subcommittee of the Oncologic Drugs Advisory Committee, 24720-24722 2017-11030 Vaccines and Related Biological Products Advisory Committee, 24717-24718 2017-10976 Food and Nutrition Food and Nutrition Service NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Assessment of States' Use of Computer Matching Protocols in SNAP, 24659-24664 2017-11029 Evaluation of Alternatives to Improve Elderly Access, 24664-24667 2017-11028 Study of School Food Authority Procurement Practices, 24667-24670 2017-11041 Forest Forest Service NOTICES Meetings: Sierra County Resource Advisory Committee, 24671 2017-10952 General Services General Services Administration PROPOSED RULES Evaluation of Existing Acquisition Regulations, 24653-24654 2017-11052 Evaluation of Existing Federal Management and Federal Property Management Regulations, 24651-24652 2017-11057 Evaluation of Existing Leasing Acquisition Regulations, 24652-24653 2017-11051 Federal Travel Regulation System; Evaluation of Existing Federal Travel Regulations, 24652 2017-11055 Grain Inspection Grain Inspection, Packers and Stockyards Administration NOTICES Designations: Aberdeen Area, 24671-24672 2017-10996 Hastings Area, 24672-24673 2017-10988 Health and Human Health and Human Services Department See

Agency for Healthcare Research and Quality

See

Centers for Disease Control and Prevention

See

Children and Families Administration

See

Food and Drug Administration

See

National Institutes of Health

See

Substance Abuse and Mental Health Services Administration

Homeland Homeland Security Department See

Coast Guard

See

Federal Emergency Management Agency

See

U.S. Customs and Border Protection

Housing Housing and Urban Development Department RULES Inflation Catch-up Adjustment of Civil Monetary Penalty Amounts Final Rule and Adjustment of Civil Monetary Penalty Amounts for 2017, 24521-24525 2017-11056 Interior Interior Department See

Fish and Wildlife Service

International Trade Adm International Trade Administration NOTICES Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Certain Cased Pencils from the People's Republic of China, 24675-24677 2017-11053 Malleable Cast Iron Pipe Fittings From The People's Republic Of China, 24677 2017-11091 Meetings: Advisory Committee on Supply Chain Competitiveness, 24679 2017-11074 Renewable Energy and Energy Efficiency Advisory Committee, 24678-24679 2017-10999 Renewable Energy and Energy Efficiency Advisory Committee; Conference Call, 24677-24678 2017-10998 International Trade Com International Trade Commission NOTICES Meetings; Sunshine Act, 24737 2017-11172 Justice Department Justice Department NOTICES Proposed Stipulations and Orders: United States, et al. v. NSTAR Electric Co. d/b/a Eversource Energy, Harbor Electric Energy Co., 24737 2017-11032 Library Library of Congress See

Copyright Royalty Board

Maritime Maritime Administration NOTICES Requests for Administrative Waivers of the Coastwise Trade Laws: Vessel COYOTE, 24779-24780 2017-11021 Vessel RESOLUTE, 24780-24781 2017-11022 Vessel SEDNA, 24780 2017-11023 Vessel SOMEWHERE, 24779 2017-11024 Vessel TWANOH, 24778-24779 2017-11025 National Archives National Archives and Records Administration NOTICES Records Schedules; Availability, 24737-24740 2017-11092 2017-11104 National Capital National Capital Planning Commission PROPOSED RULES National Environmental Policy Act Regulations, 24570-24582 2017-10940 National Credit National Credit Union Administration NOTICES Meetings; Sunshine Act, 24740 2017-11190 National Institute National Institutes of Health NOTICES Meetings: Center for Scientific Review, 24726, 24728-24729 2017-11093 2017-11094 National Center for Advancing Translational Sciences, 24726-24727 2017-10991 National Heart, Lung, and Blood Institute, 24725-24727 2017-10992 2017-10993 2017-10994 2017-10995 National Institute of Allergy and Infectious Diseases, 24727 2017-11095 National Institute of Dental and Craniofacial Research, 24727 2017-11096 National Institute of Neurological Disorders and Stroke, 24725 2017-11097 National Oceanic National Oceanic and Atmospheric Administration RULES Capital Construction Fund: Fishing Vessel Capital Construction Fund Procedures, 24561-24568 2017-11083 Fisheries of the Northeastern United States: Northeast Multispecies Fishery; American Plaice Trimester Total Allowable Catch Area Closure for the Common Pool Fishery, 24569 2017-11058 PROPOSED RULES Fisheries Off West Coast States: Coastal Pelagic Species Fisheries; Annual Specifications, 24656-24658 2017-11031 NOTICES Takes of Marine Mammals Incidental to Specified Activities: Gull Monitoring and Research in Glacier Bay National Park, AK, 2017, 24681-24688 2017-11036 U.S. Navy Training Activities in the Gulf of Alaska Temporary Maritime Activities Area, 24679-24681 2017-11037 National Science National Science Foundation NOTICES Federal Health Information Technology Research and Development Strategic Framework, 24740-24742 2017-11072 Nuclear Regulatory Nuclear Regulatory Commission RULES List of Approved Spent Fuel Storage Casks: TN Americas, LLC, NUHOMS EOS Dry Spent Fuel Storage System, Certificate of Compliance No. 1042, 24457-24458 2017-11064 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Medical Use of Byproduct Material, 24750-24751 2017-10967 License Applications: Exelon Generation Co., LLC, James A. FitzPatrick Nuclear Power Plant, 24742-24745 2017-11039 License Applications; Amendments: Exelon Generation Co., LLC, Nine Mile Point Nuclear Station, Units 1 and 2, 24746-24750 2017-11040 Meetings: Advisory Committee on Reactor Safeguards Subcommittee on APR1400, 24746 2017-11075 Patient Release Program, 24745-24746 2017-11027 Securities Securities and Exchange Commission NOTICES Self-Regulatory Organizations; Proposed Rule Changes: Nasdaq GEMX, LLC, 24751-24752 2017-10975 Nasdaq ISE, LLC, 24753-24755, 24761-24763 2017-10972 2017-10984 NYSE MKT LLC, 24763-24766 2017-10974 2017-10983 The NASDAQ Stock Market LLC, 24755-24761 2017-10973 Small Business Small Business Administration NOTICES Disaster Declarations: Oklahoma, 24766-24767 2017-10985 Social Social Security Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 24767-24769 2017-10969 Rulings: Rescission of Social Security Ruling 91-3p; Policy Interpretation Ruling Title II; Determining Entitlement to Disability Benefits for Months Prior to January 1991 For Widows, Widowers and Surviving Divorced Spouses Claims, 24769 2017-10962 Substance Substance Abuse and Mental Health Services Administration NOTICES Meetings: Center for Substance Abuse Prevention, 24729 2017-10989 Transportation Department Transportation Department See

Federal Aviation Administration

See

Federal Highway Administration

See

Federal Motor Carrier Safety Administration

See

Federal Railroad Administration

See

Maritime Administration

Customs U.S. Customs and Border Protection NOTICES Requests for Nominations: U.S. Customs and Border Protection User Fee Advisory Committee, 24729-24730 2017-10961 Veteran Affairs Veterans Affairs Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Vocational Rehabilitation and Employment Longitudinal Study Survey, 24783 2017-11016 Requests for Nominations: MyVA Advisory Committee, 24782-24783 2017-11054 Veterans' Family, Caregiver, and Survivor Advisory Committee, 24781-24782 2017-10956 Separate Parts In This Issue Part II Interior Department, Fish and Wildlife Service, 24786-24821 2017-11042 Reader Aids

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82 102 Tuesday, May 30, 2017 Rules and Regulations DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 1260 [No. AMS-LPS-15-0084] Beef Promotion and Research Rules and Regulations AGENCY:

Agricultural Marketing Service, USDA.

ACTION:

Final rule.

SUMMARY:

This final rule amends the Beef Promotion and Research Order (Order) established under the Beef Promotion and Research Act of 1985 (Act) by adding six Harmonized Tariff Schedule (HTS) codes for imported veal and veal products and updating assessment levels for imported veal and veal products based on revised determinations of live animal equivalencies. In addition to the foregoing, the Agricultural Marketing Service (AMS) is amending the Order's definition of “Imported beef or beef products” by deleting its reference to tariff numbers that are no longer in use and obsolete.

DATES:

Effective June 29, 2017.

FOR FURTHER INFORMATION CONTACT:

Mike Dinkel, Agricultural Marketing Specialist, Research and Promotion Division, Livestock, Poultry, and Seed Program; AMS, USDA; Room 2610-S, STOP 0249, 1400 Independence Avenue SW., Washington, DC 20250-0249; fax (202) 720-1125; telephone (301) 352-7497; or email [email protected]

SUPPLEMENTARY INFORMATION:

Executive Orders 12866 and 13771, and Regulatory Flexibility Act

This rule does not meet the definition of a significant regulatory action contained in section 3(f) of Executive Order 12866, and is not subject to review by the Office of Management and Budget (OMB). Additionally, because this rule does not meet the definition of a significant regulatory action it does not trigger the requirements contained in Executive Order 13771. See OMB's Memorandum titled “Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017, titled `Reducing Regulation and Controlling Regulatory Costs' ” (February 2, 2017). Pursuant to the requirements set forth in the Regulatory Flexibility Act (RFA) [5 U.S.C. 601 et seq.], the Acting Administrator of AMS has considered the economic effect of this action on small entities and has determined that this final rule does not have a significant economic impact on a substantial number of small business entities. The effect of the Order upon small entities was discussed in the July 18, 1986, Federal Register [51 FR 26132]. The purpose of RFA is to fit regulatory actions to the scale of businesses subject to such actions in order that small businesses will not be unduly burdened.

Based on conversations with importing companies, AMS estimates that approximately 270 importers import beef and beef products and veal and veal products into the U.S. and about 198 importers import live cattle into the U.S. The majority of these operations subject to the Order are considered small businesses under the criteria established by the Small Business Administration (SBA) [13 CFR 121.201]. SBA defines small agricultural service firms as those having annual receipts of $7.5 million or less.

This final rule imposes no significant burden on the industry. Importers are already required to pay assessments. It merely adds six HTS codes for imported veal and veal products and updates assessment rates for imported veal and veal products based on revised determinations of live animal equivalencies. The addition of HTS codes reflects an increase of imported veal and veal products into the U.S. Accordingly, the Acting Administrator of AMS has determined that this action does not have a significant impact on a substantial number of small entities.

Executive Order 12988

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule is not intended to have a retroactive effect.

Section 11 of the Act [7 U.S.C. 2910] provides that nothing in the Act may be construed to preempt or supersede any other program relating to beef promotion organized and operated under the laws of the U.S. or any state. There are no administrative proceedings that must be exhausted prior to any judicial challenge to the provisions of this rule.

Paperwork Reduction Act

In accordance with OMB regulations [5 CFR 1320] that implement the Paperwork Reduction Act of 1995 [44 U.S.C. Chapter 35], the information collection and recordkeeping requirements contained in the Order and accompanying Rules and Regulations have previously been approved by OMB under OMB control number 0581-0093.

Background

The Act authorized the establishment of a national beef promotion and research program. The final Order was published in the Federal Register on July 18, 1986 [51 FR 21632], and the collection of assessments began on October 1, 1986. The program is administered by the Cattlemen's Beef Promotion and Research Board (Board), appointed by the Secretary of Agriculture (Secretary) from industry nominations, and composed of 100 cattle producers and importers. The program is funded by a $1-per-head assessment on producers selling cattle in the U.S. as well as an equivalent assessment on importers of cattle, beef, and beef products.

Importers pay assessments on imported cattle, beef, and beef products. U.S. Customs and Border Protection collects and remits the assessment on imported cattle, beef, and beef products. The term “importer” is defined as “any person who imports cattle, beef, or beef products from outside the United States” [7 CFR 1260.117]. Imported beef or beef products is defined as “products which are imported into the United States which the Secretary determines contain a substantial amount of beef including those products which have been assigned one or more of the following numbers in the Tariff Schedule of the United States” [7 CFR 1260.121].

On March 16, 2016, AMS published a proposed rule in the Federal Register [81 FR 14022] amending 7 CFR 1260.172 of the Order to add six HTS codes for imported veal and veal products. On May 6, 2016, AMS announced in a Notice to Trade that it was withdrawing the proposed rule because an error was discovered in the imported veal carcass weight. AMS also announced at that time that it intended to publish another proposed rule with the correct carcass weight and to include the formula and an explanation of how the new assessment rates are calculated. On June 30, 2016, AMS published the withdrawal notice in the Federal Register [81 FR 42576] and on August 23, 2016, published the corrected proposed rule in the Federal Register [81 FR 57495].

The Act requires that assessments on imported beef and beef products and veal and veal products be determined by converting such imports into live animal equivalents to ascertain the corresponding number of head of cattle. Carcass weight is the principle factor in calculating live animal equivalents.

Prior to publishing the March 16, 2016, proposed rule, the U.S. Department of Agriculture (USDA) received information from the Board regarding assessments on imported veal. The Board requested expanding the number of HTS codes for imported veal and veal products in order to capture product that is not currently being assessed and to update the live animal equivalency rate on imported veal to reflect the same assessment as domestic veal and veal products. The Board also suggested that AMS update the dressed veal weight to better reflect current dressed veal weights. The Board recommended using an average dressed veal weight from 2010 to the most current data. The Board stated that establishing an average over this period of time takes into account short-term highs and lows due to the cattle cycle, weather effects, and feed prices. In this final rule, the average dressed weight used to determine the assessment on imported veal and veal products is 154 pounds.

In order to convert carcasses and cuts back to a live animal equivalency, conversion factors are used. The conversion factor takes into account what is lost (feet, head, tail, hide, internal organs, and bone for boneless product) as the veal is processed into carcasses, bone-in cuts, and boneless cuts.

For bone-in carcasses and cuts, a one-to-one ratio is used to convert product weight to a live animal equivalent. For boneless veal cuts, the conversion factor “adds back” the weight of the bones removed from the product.

While the regulatory text in the proposed rule [81 FR 57495] includes two brief tables containing only the specific changes and additions, the regulatory text in this final rule includes comprehensive tables incorporating the changes and additions within previously existing tables that were never intended to be deleted.

Finally, upon further review of this final rule and the Order, AMS discovered that the seven digit HTS codes listed under section 1260.121, which defines the term “Imported beef or beef products,” are no longer in use and obsolete. Those codes were replaced by 10 digit HTS codes currently found in section 7 CFR 1262.172(b)(2) of the Order. As a result, AMS is amending the definition by removing those obsolete HTS code references. No other changes are made to the definition.

Summary of Comments

On August 23, 2016, AMS published a proposed rule with a request for public comment. AMS received four timely comments. Three comments were received from the Board and national veal and beef industry organizations that were relevant to the proposed rule. One comment was outside the scope of the rulemaking.

Three commenters discussed the conversion factor for bone-in and boneless veal cuts. The commenters agreed with USDA's conversion factor for bone-in veal cuts. However, the commenters disagreed with USDA's conversion factor used for boneless imported veal cuts.

In the proposed rule, AMS used the conversion factor of 1.32 based on Table 7 (Factors used to convert pounds of carcass weight to retail and trimmed, boneless equivalent weights for red meats) of the “Economic Research Service Agricultural Handbook Number 697, Weights, Measures, and Conversion Factors for Agricultural Commodities and Their Products (June 1992)” (Handbook). However, the three commenters suggested that AMS should use the conversion factor of 1.46 for veal grading choice and good from Table 10 (Factors for converting pounds of boneless meat to untrimmed bone-in equivalent) of the Handbook because the conversion factor of 1.32 converts the boneless veal back to 0.904 pounds of bone-in veal rather than one pound. The conversion factor of 1.46 (proposed by the commenters) converts 0.685 pounds of boneless veal back to one pound of bone-in veal based on the equation: 0.685(1.46) = 1.0.

AMS believes the comments have merit. Accordingly, the new assessment rates for veal and veal products will be:

ER30MY17.010 ER30MY17.011 List of Subjects in 7 CFR Part 1260

Administrative practice and procedure, Advertising, Agricultural research, Imports, Marketing agreement, Meat and meat products, Reporting and recordkeeping requirements.

For the reasons set forth in the preamble, AMS amends 7 CFR part 1260 as follows:

PART 1260—BEEF PROMOTION AND RESEARCH 1. The authority citation for 7 CFR part 1260 continues to read as follows: Authority:

7 U.S.C. 2901-2911 and 7 U.S.C. 7401.

2. Revise § 1260.121 to read as follows:
§ 1260.121 Imported beef or beef products

Imported beef or beef products means products which are imported into the United States which the Secretary determines contain a substantial amount of beef including those products which have been assigned one or more numbers in the Tariff Schedule of the United States.

3. Amend § 1260.172 by revising paragraph (b)(2) to read as follows:
§ 1260.172 Assessments.

(b) * * *

(2) The assessment rates for imported cattle, beef, beef products, are as follows:

Imported Live Cattle HTS No. Assessment
  • rate per head
  • 0102.10.0010 $1.00 0102.10.0020 1.00 0102.10.0030 1.00 0102.10.0050 1.00 0102.90.2011 1.00 0102.90.2012 1.00 0102.90.4024 1.00 0102.90.4028 1.00 0102.90.4034 1.00 0102.90.4038 1.00 0102.90.4054 1.00 0102.90.4058 1.00 0102.90.4062 1.00 0102.90.4064 1.00 0102.90.4066 1.00 0102.90.4068 1.00 0102.90.4072 1.00 0102.90.4074 1.00 0102.90.4082 1.00 0102.90.4084 1.00
    Imported Beef and Beef Products HTS No. Assessment
  • rate per kg
  • 0201.10.0510 .01431558 0201.10.0590 .00379102 0201.10.1010 .01431558 0201.10.1090 .00379102 0201.10.5010 .01431558 0201.10.5090 .00511787 0201.20.0200 .00530743 0201.20.0400 .00511787 0201.20.0600 .00379102 0201.20.1000 .00530743 0201.20.3000 .00511787 0201.20.5000 .00379102 0201.20.5010 .01431558 0201.20.5020 .01431558 0201.20.8090 .00379102 0201.30.0200 .00530743 0201.30.0400 .00511787 0201.30.0600 .00379102 0201.30.1000 .00530743 0201.30.3000 .00511787 0201.30.5000 .00511787 0201.30.5010 .02090075 0201.30.5020 .02090075 0201.30.8090 .00511787 0202.10.0510 .01431558 0202.10.0590 .00379102 0202.10.1010 .01431558 0202.10.1090 .00370102 0202.10.5010 .01431558 0202.10.5090 .00379102 0202.20.0200 .00530743 0202.20.0400 .00511787 0202.20.0600 .00379102 0202.20.1000 .00530743 0202.20.3000 .00511787 0202.20.5000 .00379102 0202.20.8000 .00379102 0202.30.0200 .00530743 0202.30.0400 .00511787 0202.30.0600 .00527837 0202.30.1000 .00530743 0202.30.3000 .00511787 0202.30.5000 .00511787 0202.30.5010 .02090075 0202.30.5020 .02090075 0202.30.8000 .00379102 0206.10.0000 .00379102 0206.21.0000 .00379102 0206.22.0000 .00379102 0206.29.0000 .00379102 0210.20.0000 .00615701 1601.00.4010 .00473877 1601.00.4090 .00473877 1601.00.6020 .00473877 1602.50.0900 .00663428 1602.50.1020 .00663428 1602.50.1040 .00663428 1602.50.2020 .00701388 1602.50.2040 .00701388 1602.50.6000 .00720293
    Dated: May 23, 2017. Bruce Summers, Acting Administrator, Agricultural Marketing Service.
    [FR Doc. 2017-10986 Filed 5-26-17; 8:45 am] BILLING CODE 3410-02-P
    NUCLEAR REGULATORY COMMISSION 10 CFR Part 72 [NRC-2016-0254] RIN 3150-AJ88 List of Approved Spent Fuel Storage Casks: TN Americas, LLC, NUHOMS® EOS Dry Spent Fuel Storage System, Certificate of Compliance No. 1042 AGENCY:

    Nuclear Regulatory Commission.

    ACTION:

    Direct final rule; confirmation of effective date.

    SUMMARY:

    The U.S. Nuclear Regulatory Commission (NRC) is confirming the effective date of June 7, 2017, for the direct final rule that was published in the Federal Register on March 24, 2017. The direct final rule amended the NRC's spent fuel storage regulations by revising the “List of approved spent fuel storage casks” to add the TN Americas, LLC (TN Americas), NUHOMS® Extended Optimized Storage (EOS) Dry Spent Fuel Storage System as Certificate of Compliance (CoC) No. 1042.

    DATES:

    Effective Date: The effective date of June 7, 2017, for the direct final rule published March 24, 2017 (82 FR 14987), is confirmed.

    ADDRESSES:

    Please refer to Docket ID NRC-2016-0254 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information related to this action by any of the following methods:

    Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2016-0254. Address questions about NRC dockets to Carol Gallagher; telephone: 301-415-3463; email: [email protected] For technical questions, contact the individual listed in the FOR FURTHER INFORMATION CONTACT section of this document.

    NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select “ADAMS Public Documents” and then select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209, 301-415-4737, or by email to [email protected] The ADAMS accession number for each document referenced (if it is available in ADAMS) is provided the first time that it is mentioned in the SUPPLEMENTARY INFORMATION section.

    NRC's PDR: You may examine and purchase copies of public documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 Rockville Pike, Rockville, Maryland 20852.

    FOR FURTHER INFORMATION CONTACT:

    Edward Lohr, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-0253; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    On March 24, 2017 (82 FR 14987), the NRC published a direct final rule amending § 72.214 of title 10 of the Code of Federal Regulations by revising the “List of approved spent fuel storage casks” to add the TN Americas NUHOMS® EOS Dry Spent Fuel Storage System as CoC No. 1042. The NUHOMS® EOS System provides horizontal storage of high burnup spent pressurized water reactor (PWR) and boiling water reactor (BWR) fuel assemblies in dry shielded canisters (DSCs). The new PWR and BWR DSCs are the EOS-37PTH DSC and the EOS-89BTH DSC, respectively.

    In the direct final rule, the NRC stated that if no significant adverse comments were received, the direct final rule would become effective on June 7, 2017. As described more fully in the direct final rule, a significant adverse comment is a comment where the commenter explains why the rule would be inappropriate, including challenges to the rule's underlying premise or approach, or would be ineffective or unacceptable without a change. Because no significant adverse comments were received, the direct final rule will become effective as scheduled.

    The final CoC, technical specifications, and the final Safety Evaluation Report for CoC No. 1042 are available in ADAMS under Package Accession No. ML17116A277.

    Dated at Rockville, Maryland, this 24th day of May 2017.

    For the Nuclear Regulatory Commission.

    Cindy Bladey, Chief, Rules, Announcements, and Directives Branch, Division of Administrative Services, Office of Administration.
    [FR Doc. 2017-11064 Filed 5-26-17; 8:45 am] BILLING CODE 7590-01-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 29 [Docket No. FAA-2017-0466; Special Conditions No. 29-041-SC] Special Conditions: Bell Helicopter Textron Inc. (Bell) Model 412EP Helicopter in the 412 EPI Configuration; Search and Rescue (SAR) With Automatic Flight Control System (AFCS) Installation AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final special conditions; request for comments.

    SUMMARY:

    These special conditions are issued for the Bell Model 412EP (412EPI configuration) helicopter. This helicopter as modified by Bell will have a novel or unusual design feature associated with a SAR AFCS. The applicable airworthiness standards do not contain adequate or appropriate safety standards for this design feature. These special conditions contain the additional safety standards the Administrator considers necessary to establish a level of safety equivalent to that established by the existing airworthiness standards.

    DATES:

    These special conditions are effective June 29, 2017. We must receive your comments by July 31, 2017.

    ADDRESSES:

    Send comments identified by docket number [FAA-2017-0466] using any of the following methods:

    Federal eRegulations Portal: Go to http://www.regulations.gov and follow the online instructions for sending your comments electronically.

    Mail: Send comments to Docket Operations, M-30, U.S. Department of Transportation (DOT), 1200 New Jersey Avenue SE., Room W12-140, West Building Ground Floor, Washington, DC 20590-0001.

    Hand Delivery of Courier: Deliver comments to the “Mail” address between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    Fax: Fax comments to Docket Operations at 202-493-2251.

    Privacy: The FAA will post all comments it receives, without change, to http://regulations.gov, including any personal information the commenter provides. Using the search function of the docket Web site, anyone can find and read the electronic form of all comments received into any FAA docket, including the name of the individual sending the comment (or signing the comment for an association, business, labor union, etc.). DOT's complete Privacy Act Statement can be found in the Federal Register published on April 11, 2000 (65 FR 19477-19478), as well as at http://DocketsInfo.dot.gov.

    Docket: You can read the background documents or comments received at http://www.regulations.gov. Follow the online instructions for accessing the docket or go to the Docket Operations in Room @12-140 of the West Building Ground Floor at 1200 New Jersey Avenue SE., Washington, DC, between 9 a.m., and 5 p.m., Monday through Friday, except Federal holidays.

    FOR FURTHER INFORMATION CONTACT:

    George Harrum, Flight Analyst, FAA, Rotorcraft Directorate, Regulations and Policy Group, (ASW-111), 10101 Hillwood Parkway, Fort Worth, Texas 76177; telephone (817) 222-4087; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Reason for No Prior Notice and Comment Before Adoption

    The substance of these special conditions has been subjected to the notice and comment period previously and has been derived without substantive change from those previously issued. It is unlikely that prior public comment would result in a significant change from the substance contained herein. Therefore, the FAA has determined that prior public notice and comment are unnecessary, impracticable, and contrary to the public interest, and finds good cause exists for adopting these special conditions upon issuance. The FAA is requesting comments to allow interested persons to submit views that may not have been submitted in response to the prior opportunities for comment.

    Comments Invited

    We invite interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data.

    We will consider all comments we receive by the closing date for comments. We will consider comments filed late if it is possible to do so without incurring additional expense or delay. We may change these special conditions based on the comments we receive.

    Background and Discussion

    On March 20, 2015, Bell applied for a supplemental type certificate (STC) for installation of an optional SAR AFCS in certain Model 412EP helicopters. The Model 412EP helicopter, approved under Type Certificate No. H4SW, is a 14 CFR part 29 transport category helicopter certificated in both Category A and Category B and for operation under instrument flight rules under the requirements of Appendix B to Part 29. Bell designated certain serial-numbered Model 412EP helicopters for a specific configuration commercially identified as “412EPI.” The 412 EPI configuration includes the following changes from the 412EP: Installation of the Pratt & Whitney Canada Model PT6T-9 Twin Power Section Turboshaft Engine with Electronic Engine Control, and cockpit instruments and avionics replacement with the Bell BasiX-Pro® Integrated Avionics System. This rotorcraft has a maximum take-off weight of 12,200 pounds. It carries up to 13 passengers with maximum external load of almost 6,614 lbs. and a range up to 609 miles.

    The use of dedicated AFCS upper modes, in which a fully coupled autopilot provides operational SAR profiles, is needed for SAR operations conducted over water in offshore areas clear of obstructions. The SAR modes enable the helicopter pilot to fly fully coupled maneuvers, to include predefined search patterns during cruise flight, and to transition from cruise flight to a stabilized hover and departure (transition from hover to cruise flight). The SAR AFCS also includes an auxiliary crew control that allows another crewmember (such as a hoist operator) to have limited authority to control the helicopter's longitudinal and lateral position during hover operations.

    Flight operations conducted over water at night may have an extremely limited visual horizon with little visual reference to the surface even when conducted under Visual Meteorological Conditions. Consequently, the certification requirements for SAR modes must meet the criteria in Appendix B to Part 29. While Appendix B to Part 29 prescribes airworthiness criteria for instrument flight, it does not consider operations below instrument flight minimum speed (VMINI), whereas the SAR modes allow for coupled operations at low speed, all-azimuth flight to zero airspeed (hover).

    The regulations as currently promulgated did not envision instrument flight below the Appendix B envelope, including hover using AFCS modes. This necessitates the development of a special condition to address the gap in 14 CFR part 29 regulations and the lack of adequate airworthiness standards for AFCS SAR mode certification to include flight characteristics, performance, and installed equipment and systems. Also, the requirements of the Bell 412EP Special Conditions No. 29-ASW-5 are not adequate to address the safety objectives for this SAR AFCS design feature. Special Conditions No. 29-ASW-5 only requires provisions for mitigating hazards to required equipment from high intensity radio frequency transmission sources.

    The 412EPI configuration SAR operations necessitate safety critical navigation and control functions. These functions allow the rotorcraft to operate under instrument flight rules (IFR) then transition to stabilized visual flight rules hover below required minimum obstacle distances. To safely accomplish this specialized operation, the equipment must possess minimum functional reliability and availability under potentially adverse environmental conditions. The 412EPI configuration SAR equipment operates as an integrated system to accomplish the functions mentioned above.

    Type Certification Basis

    Under the provisions of 14 CFR 21.101, Bell must show that the 412EP model helicopter in the 412EPI configuration, as changed, continues to meet either the applicable provisions of the regulations incorporated by reference in type certificate (TC) No. H4SW or the applicable regulations in effect on the date of application for the change, depending on the significance of the change as defined by 14 CFR 21.101. The regulations incorporated by reference in the TC are commonly referred to as the “original type certification basis.” The regulations incorporated by reference in H4SW are as follows:

    (a) 14 CFR part 29, dated February 1, 1965, including Amendments 29-1 through 29-51.

    (b) 14 CFR 29.141, 29.143, 29.251, 29.301, 29.303, 29.305, 29.307(a), 29.561(c), 29.601(a), 29.603, 29.605, 29.609(a), 29.625, 29.777, 29.831(b)(c)(d), 29.907, 29.993, 29.1023(a), 29.1049, 29.1093. 29.1203(a)(b)(d), 29.1301, 29.1327, 29.1381, 29.1385, 29.1389, 29.1391, 29.1393, 29.1395, 29.1431, 29.1435, 29.1523(a)(b), 29.1541, 29.1543(b), 29.1547, 29.1551, 29.1553, at Amdt. 29-0.

    (c) 14 CFR 29.955(a)(1) at Amdt. 29-2.

    (d) 14 CFR 29.773(a), 29.901, 29.1191(a)(c)(d)(e)(f), at Amdt. 29-3.

    (e) 14 CFR 29.1397 at Amdt. 29-7.

    (f) 14 CFR 29.1387 at Amdt 29-9.

    (g) 14 CFR part 29.1401 at Amdt. 29-11.

    (h) 14 CFR 29.63, 29.939, 29.1165, 29.1322 at Amdt. 29-12.

    (i) 14 CFR 29.1145 at Amdt. 29-13.

    (j) 14 CFR 29.1335 at Amdt. 29-14.

    (k) 14 CFR 29.29, 29.33(a)(1), 29.1353(a)(b), 29.1501, 29.1527, 29.1581(a)(b)(d) at Amdt. 29-15.

    (l) 14 CFR 29.1413(a), at Amdt. 29-16.

    (m) 14 CFR 29.1091(a)(b), 29.1545 at Amdt. 29-17.

    (n) 14 CFR 29.571, 29.1529, 14 CFR part 29 Appendix A at Amdt. 29-20.

    (o) 14 CFR 29.1321, 14 CFR part 29 Appendix B I and IX (a)(b) at Amdt. 29-21.

    (p) 14 CFR 29.853(a)(2)(c) at Amdt. 29-23.

    (q) 14 CFR 29.21, 29.45(a)(b)(c)(e)(f), 29.151, 29.672(a), 29.771(a)(b)(c), 29.1303, 29.1325, 29.1331, 29.1333, 29.1355, 29.1357(a)(c)(d)(e)(g), 29.1517, 29.1555(a)(b)(c)(d), 29.1559, 29.1583, 29.1585 at Amdt. 29-24.

    (r) 14 CFR 29.1011(d), 29.1041, 29.1043, 29.1045, 29.1047, 29.1141(a)(b)(c)(d)(f)(2), 29.1337(a)(b)(1)(2)(c)(d)(e), 29.1557(c)(2) at Amdt. 29-26.

    (s) 14 CFR 29.337(a), 29.613(d), at Amdt. 29-30.

    (t) 14 CFR 29.783(e), 29.903(a)(b)(c)(3)(d)(e) at Amdt. 29-31

    (u) 14CFR 29.1143(a)(b)(c)(e)(f), 29.1549 at Amdt. 29-34.

    (v) 14 CFR 29.49(a)(b)(c), 29.51, 29.53, 29.55, 29.60, 29.61, 29.64, 29.65(a), 29.75, 29.79, 29.83(a)(b), 29.87(a), at Amdt. 29-39.

    (w) 14 CFR 29.1305(a)(3)(4)(6-19)(21-23)(25)(26)(b)(c), 29.1309(a)(b)(2)(c)(d)(e)(f)(g)(h), 14 CFR part 29 Appendix B VIII (a)(b)(3)(4)(5)(6)(c), at Amdt. 29-40.

    (x) 14 CFR 29.1521(a)(b)(1)(3)(4)(5)(6)(7)(ii)(c)(4)(d)(e)(f)(g)(h)(i)(j) at Amdt. 29-41.

    (y) 14 CFR 29.1329(f), 29.1351(a)(b)(3)(4)(6)(d), 29.1359 at Amdt. 29-42.

    (z) 14 CFR 29.865(c)(6) at Amdt. 29-43.

    (aa) 14 CFR 29.59, 29.62, 29.67, 29.77, 29.81, 29.85, 29.1323(a)(b)(c)(d)(e) at Amdt. 29-44.

    (bb) 14 CFR 29.1317(a)(b)(c), 14 CFR part 29 Appendix E at Amdt. 29-49.

    (cc) 14 CFR 29.1587 at Amdt. 29-51.

    (dd) Equivalent Level of Safety Findings:

    (1) 14 CFR 29.1305(a)(11-16) and 29.1549(a)(b)(c)(e) for the Power Situation Indicator (documented in ELOS Memo No. ST0025RC-RD/P-1) dated January 16, 2013.

    (2) 14 CFR 29.1545(b)(2) for Airspeed Indicator (documented in ELOS Memo No. ST0025RC-RD/F-2) dated September 27, 2012.

    (3) 14 CFR 29.1333(a) and 14 CFR part 29 Appendix B VIII(b)(5)(i) and (ii) for Electronically Integrated Flight Instrument Systems (documented in ELOS Memo No. ST0025RC-RD/S-2) dated January 25, 2013.

    (4) 14 CFR 29.1555(c)(1) for the Useable Fuel Capacity Marking (documented in ELOS Memo No. ST0025RC-RD/P-2) dated December 18, 2012.

    (ee) If BHT Kit 412-706-140, Increased Gross Weight, is installed then compliance has also been shown to 14 CFR 29.25(a)(1)(3)(4) Amend 29-51, 14 CFR part 29 Appendix B III, IV(a)(b)(1)(3)(c)(1)(d)(1)(e)(f), V, VI, VII at Amend 29-21 and 14 CFR 36.1(c) at Amend 36-14.

    Regulatory Basis for Special Conditions

    If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 29) do not contain adequate or appropriate safety standards for the Bell Model 412EP helicopter in the 412EPI configuration because of a novel or unusual design feature, special conditions are prescribed under § 21.16.

    The FAA issues special conditions, as defined in § 11.19, under § 11.38, and they become part of the type certification basis under § 21.101.

    Special conditions are initially applicable to the model for which they are issued. Should the TC for that model be amended later to include any other model that incorporates the same novel or unusual design feature, or should any other model already included on the same TC be modified to incorporate the same novel or unusual design feature, the special conditions would also apply to the other model.

    Novel or Unusual Design Features

    The Bell Model 412EP helicopter in the 412EPI configuration will incorporate the following novel or unusual design features.

    The SAR system is composed of a navigation computer with SAR modes, an AFCS that provides coupled SAR functions, hoist operator control, a hover speed reference system, and two radio altimeters. The AFCS coupled SAR functions include:

    (a) Hover hold at selected height above the surface.

    (b) Ground speed hold.

    (c) Transition down and hover to a waypoint under guidance from the navigation computer.

    (d) SAR pattern, transition down, and hover near a target over which the helicopter has flown.

    (e) Transition up, climb, and capture a cruise height.

    (f) Capture and track SAR search patterns generated by the navigation computer.

    (g) Monitor the preselected hover height with automatic increase in collective if the aircraft height drops below the safe minimum height.

    These SAR modes are intended to be used over large bodies of water in areas clear of obstructions. Further, use of the modes that transition down from cruise to hover will include operation at airspeeds below VMINI.

    The SAR system only entails navigation, flight control, and coupled AFCS operation of the helicopter. The system does not include additional equipment that may be required for over water flight or external loads to meet other operational requirements.

    Applicability

    These special conditions apply to the Bell Model 412EP helicopter in the 412EPI configuration. Should Bell apply at a later date for a change to the type certificate to include another model incorporating the same novel or unusual design feature, the special conditions would apply to that model as well under the provisions of § 21.101(d).

    Conclusion

    This action affects only certain novel or unusual design features on one model of helicopter. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of these features on the helicopter.

    List of Subjects in 14 CFR Part 29

    Aircraft, Aviation safety.

    The authority citation for these special conditions is as follows:

    Authority:

    49 U.S.C. 106(g), 40113, 44701-44702, 44704.

    The Special Conditions

    Accordingly, pursuant to the authority delegated to me by the Administrator, the following special conditions are issued as part of the type certification basis for Bell Helicopter Textron Inc. (Bell) Model 412EP helicopters in the 412EPI configuration when modified by Bell by installing an optional Search and Rescue (SAR) Automatic Flight Control System (AFCS).

    In addition to the 14 CFR part 29 certification requirements for Category A and helicopter instrument flight (Appendix B), the following additional requirements must be met for certification of the SAR AFCS:

    (a) SAR Flight Modes. The coupled SAR flight modes must provide:

    (1) Safe and controlled flight in the three axes at all airspeeds (lateral position and speed, longitudinal position and speed, and height and vertical speed) from the previous VMINI to a hover (within the maximum demonstrated wind envelope).

    (2) Automatic transition to the helicopter instrument flight (Appendix B) envelope as part of the normal SAR mode sequencing.

    (3) A pilot-selectable Go-Around mode that safely interrupts any other coupled mode and automatically transitions the helicopter to the instrument flight (Appendix B) envelope.

    (4) A means to prevent unintended flight below a safe minimum height. Pilot-commanded descent below the safe minimum height is acceptable provided the alerting requirements in paragraph (b)(8)(i) of these Special Conditions alert the pilot of this descent below safe minimum height.

    (b) SAR Mode System Architecture. To support the integrity of the SAR modes, the following system architecture is required:

    (1) Ground mapping radar function that presents real-time information to the pilots.

    (2) A system for limiting the engine power demanded by the AFCS when any of the automatic piloting modes are engaged, so full authority digital engine control power limitations, such as torque and temperature, are not exceeded.

    (3) A system providing the aircraft height above the surface and final pilot-selected height at a location on the instrument panel in a position acceptable to the FAA that will make it plainly visible to and usable by any pilot at their station.

    (4) A system providing the aircraft heading and the ability to automatically hold a pilot-selected heading set by either setting the reference to the current heading or adjusting the reference left or right. If the reference setting can change faster than the aircraft ability to follow, a display of reference heading is required at a location on the instrument panel in a position acceptable to the FAA that will make it plainly visible to and usable by any pilot at their station.

    (5) A system providing the aircraft longitudinal and lateral hover velocities and the pilot-selected longitudinal and lateral velocities when used by the AFCS in the flight envelope where airspeed indications become unreliable. This information must be presented at a location on the instrument panel in a position acceptable to the FAA that is plainly visible to and usable by any pilot at their station.

    (6) A system providing wind speed and wind direction when automatic piloting modes are engaged or transitioning from one mode to another.

    (7) A means to monitor for flight guidance deviations and failures with alerting that enables the flight crew take appropriate corrective action.

    (8) An alerting system that provides visual or aural alerts, or both, to the flight crew under any of the following conditions:

    (i) When the stored or pilot-selected safe minimum height is reached.

    (ii) When a SAR mode system malfunction occurs.

    (iii) When the AFCS changes modes automatically from one SAR mode to another. For normal transitions from one SAR mode to another, a single visual or aural alert may suffice. For a SAR mode malfunction or a mode having a time-critical component, the flight crew alerting system must activate early enough to allow the flight crew to take timely and appropriate action. The alerting system means must be designed to alert the flight crew in order to minimize crew errors that could create an additional hazard.

    (9) The SAR system hoist operator control is considered a flight control with limited authority and must comply with the following:

    (i) The hoist operator control must be designed and located to provide for convenient operation and to prevent confusion and inadvertent operation.

    (ii) The helicopter must be safely controllable by the hoist operator control throughout the range of that control.

    (iii) The hoist operator control may not interfere with the safe operation of the helicopter.

    (iv) Pilot and copilot flight controls must be able to smoothly override the control authority of the hoist operator control, without exceptional piloting skill, alertness, or strength, and without the danger of exceeding any other limitation because of the override.

    (10) The reliability of the AFCS must be related to the effects of its failure. The occurrence of any failure condition that would prevent continued safe flight and landing must be extremely improbable. For any failure condition of the AFCS which is shown to not be extremely improbable:

    (i) The helicopter must be safely controllable and capable of continued safe flight without exceptional piloting skill, alertness, or strength. Additional unrelated probable failures affecting the control system must be evaluated.

    (ii) The AFCS must be designed so that it cannot create a hazardous deviation in the flight path or produce hazardous loads on the helicopter during normal operation or in the event of a malfunction or failure, assuming corrective action begins within an appropriate period of time. Where multiple systems are installed, subsequent malfunction conditions must be evaluated in sequence unless their occurrence is shown to be improbable.

    (11) A functional hazard assessment and a system safety assessment must address the failure conditions associated with SAR operations:

    (i) For SAR catastrophic failure conditions, changes may be required to the following:

    (A) System architecture.

    (B) Software and complex electronic hardware design assurance levels.

    (C) High Intensity Radiated Field (HIRF) test levels.

    (D) Instructions for continued airworthiness.

    (ii) The assessments must consider all the systems required for SAR operations, including the AFCS, all associated AFCS sensors (for example, radio altimeter), and primary flight displays. Electrical and electronic systems with SAR catastrophic failure conditions for both visual flight rules and IFR must comply with the 14 CFR 29.1317(a)(4) HIRF requirements.

    (c) SAR Mode Performance Requirements.

    (1) The SAR modes must be demonstrated for the requested flight envelope, including the following minimum sea-state and wind conditions:

    (i) Sea State: Wave height of 2.5 meters (8.2 feet), considering both short and long swells.

    (ii) Wind: 25 knots headwind; 17 knots for all other azimuths.

    (2) The selected hover height and hover velocity must be captured (including the transition from one captured mode to another captured mode) accurately and smoothly and not exhibit any significant overshoot or oscillation.

    (3) The minimum use height (MUH) for the SAR modes must be no less than the maximum loss of height following any single failure or any combination of failures not shown to be extremely improbable, plus an additional margin of 15 feet above the surface. MUH is the minimum height at which any SAR AFCS mode may be engaged.

    (4) The SAR mode system must be usable up to the maximum certified gross weight of the aircraft or to the lower of the following weights:

    (i) Maximum emergency flotation weight.

    (ii) Maximum hover Out-of-Ground Effect (OGE) weight.

    (iii) Maximum demonstrated weight.

    (d) Flight Characteristics.

    (1) For SAR mode coupled flight below VMINI, at the maximum demonstrated winds, the helicopter must be able to maintain any required flight condition and make a smooth transition from any flight condition to any other flight condition without requiring exceptional piloting skill, alertness, or strength, and without exceeding the limit load factor. This requirement also includes aircraft control through the hoist operator's control.

    (2) For coupled flight below the previously established VMINI, the following stability requirements replace the stability requirements of paragraph IV, V, and VI of Appendix B to Part 29:

    (i) Static Longitudinal Stability: The requirements of Appendix B to part 29, paragraph IV are not applicable.

    (ii) Static Lateral-Directional Stability: The requirements of Appendix B to part 29, paragraph V are not applicable.

    (iii) Dynamic Stability, paragraph VI:

    (A) Any oscillation must be damped and any aperiodic response must not double in amplitude in less than 10 seconds. This requirement must also be met with degraded upper mode(s) of the AFCS.

    (B) After any upset, such as a wind gust, the AFCS must return the aircraft to the last commanded flight condition within 10 seconds or less.

    (3) With any of the upper modes of the AFCS engaged, the pilot must be able to manually recover the aircraft and transition to the normal (Appendix B) IFR flight profile envelope without exceptional skill, alertness, or strength.

    (e) One-Engine Inoperative (OEI) Performance Information.

    (1) The following performance information must be provided in the Rotorcraft Flight Manual Supplement (RFMS):

    (i) OEI performance information and emergency procedures, providing the maximum weight that will provide a minimum clearance of 15 feet above the surface, following failure of the critical engine in a hover. The maximum weight must be presented as a function of the hover height for the temperature and pressure altitude range requested for certification. The effects of wind must be reflected in the hover performance information.

    (ii) Hover OGE performance with the critical engine inoperative for OEI continuous and time-limited power ratings for those weights, altitudes, and temperatures for which certification is requested.

    (2) These OEI performance requirements do not replace performance requirements that may be needed to comply with the airworthiness or operational standards (14 CFR 29.865 or 14 CFR part 133) for external loads or human external cargo.

    (f) RFMS.

    (1) The RFMS must contain, at a minimum:

    (i) Limitations necessary for safe operation of the SAR system, including:

    (A) Minimum crew requirements.

    (B) Maximum SAR weight.

    (C) Engagement criteria for each of the SAR modes to include MUH, as determined in paragraph (c)(3) of these Special Conditions.

    (ii) Normal and emergency procedures for operation of the SAR system (including operation of the hoist operator control) with AFCS failure modes, AFCS degraded modes, and engine failures.

    (iii) Performance information:

    (A) OEI performance and height-loss.

    (B) Hover OGE performance information, utilizing OEI continuous and time-limited power ratings.

    (C) The maximum wind envelope demonstrated in flight test.

    (D) Information and/or advisory information concerning operations in a heavy salt spray environment, including any airframe or power effects as a result of salt encrustation.

    (g) Flight Demonstration.

    (1) Before approval of the SAR system, an acceptable flight demonstration of all coupled SAR modes is required.

    (2) The AFCS must provide fail-safe operations during coupled maneuvers. The demonstration of fail-safe operations must include a pilot workload assessment associated with manually flying the aircraft to an altitude greater than 200 feet above the surface and an airspeed of at least the best rate of climb airspeed (Vy).

    (3) For any failure condition of the SAR system shown to not be extremely improbable, the pilot must be able to make a smooth transition from one flight mode to another without exceptional piloting skill, alertness, or strength.

    (4) Failure conditions that are shown to not be extremely improbable must be demonstrated by analysis, ground testing, or flight testing. For failures demonstrated in flight, the following normal pilot recovery times are acceptable:

    (i) Transition modes (Cruise-to-Hover/Hover-to-Cruise) and Hover modes: Normal pilot recognition plus 1 second.

    (ii) Cruise modes: Normal pilot recognition plus 3 seconds.

    (5) All AFCS malfunctions must include evaluation at the low-speed and high-power flight conditions typical of SAR operations. Additionally, AFCS hard-over, slow-over, and oscillatory malfunctions, particularly in yaw, require evaluation. AFCS malfunction testing must include a single or a combination of failures (such as, erroneous data from and loss of the radio altimeter, attitude, heading, and altitude sensors) that are shown to not be extremely improbable.

    (6) The flight demonstration must include the following environmental conditions:

    (i) Swell into wind.

    (ii) Swell and wind from different directions.

    (iii) Cross swell.

    (iv) Swell of different lengths (short and long swell).

    Issued in Fort Worth, Texas, on May 19, 2017. Lance T. Gant Manager, Rotorcraft Directorate, Aircraft Certification Service.
    [FR Doc. 2017-11073 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0501; Directorate Identifier 2017-NM-053-AD; Amendment 39-18908; AD 2017-11-09] RIN 2120-AA64 Airworthiness Directives; Learjet, Inc., Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final rule; request for comments.

    SUMMARY:

    We are superseding Airworthiness Directive (AD) 2017-08-07 for certain Learjet, Inc., Model 60 airplanes. AD 2017-08-07 required a one-time inspection of the fuselage skin for corrosion, and related investigative and corrective actions if necessary. This new AD retains the actions of AD 2017-08-07 and removes certain airplanes from the applicability. This AD was prompted by a determination that only certain airplanes are affected by the unsafe condition. We are issuing this AD to address the unsafe condition on these products.

    DATES:

    This AD is effective May 30, 2017.

    The Director of the Federal Register approved the incorporation by reference of a certain publication listed in this AD as of May 22, 2017 (82 FR 18084, April 17, 2017).

    We must receive comments on this AD by July 14, 2017.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this final rule, contact Learjet, Inc., One Learjet Way, Wichita, KS 67209-2942; telephone: 316-946-2000; fax: 316-946-2220; email: [email protected]; Internet: http://www.bombardier.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0501.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0501; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Paul Chapman, Aerospace Engineer, Airframe Branch, ACE-118W, FAA, Wichita Aircraft Certification Office (ACO), 1801 Airport Road, Room 100, Dwight D. Eisenhower Airport, Wichita, KS 67209; phone: 316-946-4152; fax: 316-946-4107; email: [email protected]

    SUPPLEMENTARY INFORMATION: Discussion

    On April 7, 2017, we issued AD 2017-08-07, Amendment 39-18856 (82 FR 18084, April 17, 2017) (“AD 2017-08-07”), for Learjet, Inc., Model 60 airplanes, serial numbers 60-002 through 60-430 inclusive. AD 2017-08-07 required a one-time inspection of the fuselage skin for corrosion, and related investigative and corrective actions if necessary. AD 2017-08-07 resulted from an evaluation by the design approval holder (DAH) indicating that the upper fuselage skin under the aft oxygen line fairing is subject to multi-site damage (MSD). We issued AD 2017-08-07 to detect and correct corrosion of the fuselage skin, which could result in reduced structural integrity of the airplane.

    Actions Since AD 2017-08-07 Was Issued

    Since we issued AD 2017-08-07, we determined that only certain airplanes identified in the applicability of AD 2017-08-07 are affected by the unsafe condition. For Learjet, Inc., Model 60 airplanes, serial numbers 60-002 through 60-430 inclusive, the unsafe condition affects only airplanes with a dorsal-mounted oxygen bottle and airplanes that have had the dorsal-mounted oxygen bottle removed but have retained the oxygen line fairing installed on top of the fuselage. These airplanes are identified in the effectivity of Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016, which is the appropriate source of service information for accomplishing the actions required by AD 2017-08-07. Therefore, we have revised paragraph (c) of this AD to identify only those airplanes affected by the unsafe condition.

    Related Service Information Under 1 CFR Part 51

    We reviewed Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016. The service information describes procedures for inspections of the fuselage crown skin for corrosion, and related investigative and corrective actions if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

    We are issuing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

    AD Requirements

    This AD requires a one-time inspection of the fuselage skin for corrosion, and related investigative and corrective actions if necessary. This AD also requires sending the inspection results to the FAA.

    Differences Between This AD and the Service Information

    Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016, specifies to contact the manufacturer for instructions on how to repair certain conditions, but this AD requires repairing those conditions in one of the following ways:

    • In accordance with a method that we approve; or

    • Using data that meet the certification basis of the airplane, and that have been approved by a Delegated Engineering Representative (DER) for Learjet Inc., or a Unit Member (UM) of the Learjet Organization Designation Authorization (ODA), whom we have authorized to make those findings.

    Interim Action

    We consider this AD interim action. Because the cause of the corrosion is not known, the inspection reports will help determine the extent of the corrosion in the affected fleet. Based on the results of these reports, we might determine that further corrective action is warranted. Once further corrective action has been identified, we might consider further rulemaking.

    FAA's Justification and Determination of the Effective Date

    We determined that unaffected airplanes were inadvertently included in the applicability of AD 2017-08-07, which applied to Learjet, Inc., Model 60 airplanes, serial numbers 60-002 through 60-430 inclusive. However, only airplanes identified in Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016, are subject to the identified unsafe condition. The actions required by this AD are not required to be done on airplanes that are not identified in Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016. Therefore, we are superseding AD 2017-08-07 to correct the applicability. We find that notice and opportunity for prior public comment are unnecessary and that good cause exists for making this amendment effective in less than 30 days.

    Comments Invited

    This AD is a final rule that involves requirements affecting flight safety and was not preceded by notice and an opportunity for public comment. However, we invite you to send any written data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include the docket number FAA-2017-0501 and Directorate Identifier 2017-NM-053-AD at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

    Costs of Compliance

    We estimate that this AD affects 284 airplanes of U.S. registry. We estimate the following costs to comply with this AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S.
  • operators
  • Inspection (retained action from AD 2017-08-07) 46 work-hours × $85 per hour = $3,910 $265 $4,175 $1,185,700 Reporting (retained action from AD 2017-08-07) 1 work-hour × $85 per hour = $85 0 85 24,140

    This AD adds no additional economic burden.

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

    According to the manufacturer, some of the costs of this AD may be covered under warranty, thereby reducing the cost impact on affected individuals. We do not control warranty coverage for affected individuals. As a result, we have included all known costs in our cost estimate.

    Paperwork Reduction Act

    A federal agency may not conduct or sponsor, and a person is not required to respond to, nor shall a person be subject to penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a current valid OMB control number. The control number for the collection of information required by this AD is 2120-0056. The paperwork cost associated with this AD has been detailed in the Costs of Compliance section of this document and includes time for reviewing instructions, as well as completing and reviewing the collection of information. Therefore, all reporting associated with this AD is mandatory. Comments concerning the accuracy of this burden and suggestions for reducing the burden should be directed to the FAA at 800 Independence Ave. SW., Washington, DC 20591. ATTN: Information Collection Clearance Officer, AES-200.

    Authority for This Rulemaking

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

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

    Regulatory Findings

    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.

    List of Subjects in 14 CFR Part 39

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

    Adoption of the Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by removing Airworthiness Directive (AD) 2017-08-07, Amendment 39-18856 (82 FR 18084, April 17, 2017), and adding the following new AD: 2017-11-09 Learjet, Inc.: Amendment 39-18908; Docket No. FAA-2017-0501; Directorate Identifier 2017-NM-053-AD. (a) Effective Date

    This AD is effective May 30, 2017.

    (b) Affected ADs

    This AD replaces AD 2017-08-07, Amendment 39-18856 (82 FR 18084, April 17, 2017) (“AD 2017-08-07”).

    (c) Applicability

    This AD applies to Learjet, Inc., Model 60 airplanes, certificated in any category, having serial numbers 60-002 through 60-430 inclusive, and having a configuration identified in paragraph (c)(1) or (c)(2) of this AD.

    (1) Airplanes with a dorsal-mounted oxygen bottle.

    (2) Airplanes that have had the dorsal-mounted oxygen bottle removed but have retained the oxygen line fairing installed on top of the fuselage.

    (d) Subject

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

    (e) Unsafe Condition

    This AD was prompted by an evaluation by the design approval holder indicating that the upper fuselage skin under the aft oxygen line fairing is subject to multi-site damage. We are issuing this AD to detect and correct corrosion of the fuselage skin, which could result in reduced structural integrity of the airplane.

    (f) Compliance

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

    (g) Retained Inspection of the Fuselage Skin, and Related Investigative and Corrective Actions, With No Changes

    This paragraph restates the requirements of paragraph (g) of AD 2017-08-07, with no changes. At the applicable time specified in paragraph (g)(1), (g)(2), or (g)(3) of this AD: Do a fluorescent dye penetrant inspection of the fuselage skin between stringers (S)-2L and S-2R for corrosion; and do all applicable related investigative and corrective actions; in accordance with the Accomplishment Instructions of Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016, except as required by paragraph (h) of this AD. Do all applicable related investigative and corrective actions before further flight.

    (1) For airplanes with more than 12 years since the date of issuance of the original airworthiness certificate or the date of issuance of the original export certificate of airworthiness as of May 22, 2017 (the effective date of AD 2017-08-07): Within 12 months after May 22, 2017.

    (2) For airplanes with more than 6 years but equal to or less than 12 years since the date of issuance of the original airworthiness certificate or the date of issuance of the original export certificate of airworthiness as of May 22, 2017 (the effective date of AD 2017-08-07): Within 24 months after May 22, 2017.

    (3) For airplanes with 6 years or less since the date of issuance of the original airworthiness certificate or the date of issuance of the original export certificate of airworthiness as of May 22, 2017 (the effective date of AD 2017-08-07): Within 36 months after May 22, 2017.

    (h) Retained Service Information Exception, With No Changes

    This paragraph restates the requirements of paragraph (h) of AD 2017-08-07, with no changes. Where Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016, specifies contacting Learjet, Inc., for appropriate action: Before further flight, repair using a method approved in accordance with the procedures specified in paragraph (l) of this AD.

    (i) Retained Reporting, With No Changes

    This paragraph restates the requirements of paragraph (i) of AD 2017-08-07, with no changes. At the applicable time specified in paragraph (i)(1) or (i)(2) of this AD: Submit a report of the findings (both positive and negative) of the inspection required by the introductory text of paragraph (g) of this AD to: [email protected]; or Ann Johnson, Wichita Aircraft Certification Office (ACO), 1801 Airport Road, Wichita, KS 67209. The report must include the name of the owner, the address of the owner, the name of the organization incorporating Learjet 60 Service Bulletin 60-53-19, the date that inspection was completed, the name of the person submitting the report, the address, telephone number, and email of the person submitting the report, the airplane serial number, the total time (flight hours) on the airplane, the total number of landings on the airplane, whether corrosion was detected, whether corrosion was repaired, the structural repair manual (SRM) chapter and revision used (if repaired), and whether corrosion exceeded the minimum thickness specified in Learjet 60 Service Bulletin 60-53-19 (and specify the SRM chapter and revision, if used as an aid to determine minimum thickness).

    (1) If the inspection was done on or after May 22, 2017 (the effective date of AD 2017-08-07): Submit the report within 30 days after the inspection.

    (2) If the inspection was done before May 22, 2017 (the effective date of AD 2017-08-07): Submit the report within 30 days after May 22, 2017.

    (j) Retained Credit for Previous Actions, With No Changes

    This paragraph restates the credit provided in paragraph (j) of AD 2017-08-07, with no changes. This paragraph provides credit for the actions specified in the introductory text to paragraph (g) of this AD, if those actions were performed before May 22, 2017 (the effective date of AD 2017-08-07), using Learjet 60 Service Bulletin 60-53-19, dated November 23, 2015; Learjet 60 Service Bulletin 60-53-19, Revision 1, dated April 4, 2016; or Learjet 60 Service Bulletin 60-53-19, Revision 2, dated April 18, 2016.

    (k) Paperwork Reduction Act Burden Statement

    A federal agency may not conduct or sponsor, and a person is not required to respond to, nor shall a person be subject to a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a current valid OMB Control Number. The OMB Control Number for this information collection is 2120-0056. Public reporting for this collection of information is estimated to be approximately 5 minutes per response, including the time for reviewing instructions, completing and reviewing the collection of information. All responses to this collection of information are mandatory. Comments concerning the accuracy of this burden and suggestions for reducing the burden should be directed to the FAA at: 800 Independence Ave. SW., Washington, DC 20591, Attn: Information Collection Clearance Officer, AES-200.

    (l) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Wichita ACO, FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (m)(1) of this AD.

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by a Learjet, Inc., Designated Engineering Representative (DER), or a Unit Member (UM) of the Learjet Organization Designation Authorization (ODA), that has been authorized by the Manager, Wichita ACO, to make those findings. To be approved, the repair, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (4) AMOCs approved previously for AD 2017-08-07 are approved as AMOCs for the corresponding provisions of this AD.

    (m) Related Information

    (1) For more information about this AD, contact Paul Chapman, Aerospace Engineer, Airframe Branch, ACE-118W, FAA, Wichita ACO, 1801 Airport Road, Room 100, Dwight D. Eisenhower Airport, Wichita, KS 67209; phone: 316-946-4152; fax: 316-946-4107; email: [email protected]

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

    (n) Material Incorporated by Reference

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

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

    (3) The following service information was approved for IBR on May 22, 2017 (82 FR 18084, April 17, 2017).

    (i) Learjet 60 Service Bulletin 60-53-19, Revision 3, dated August 29, 2016.

    (ii) Reserved.

    (4) For Learjet, Inc., service information identified in this AD, contact Learjet, Inc., One Learjet Way, Wichita, KS 67209-2942; telephone: 316-946-2000; fax: 316-946-2220; email: [email protected]; Internet: http://www.bombardier.com.

    (5) You may view this service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

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

    Issued in Renton, Washington, on May 18, 2017. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10786 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0053; Directorate Identifier 2016-CE-037-AD; Amendment 39-18888; AD 2017-10-14] RIN 2120-AA64 Airworthiness Directives; British Aerospace Regional Aircraft Airplanes AGENCY:

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

    ACTION:

    Final rule.

    SUMMARY:

    We are superseding Airworthiness Directive (AD) 2014-07-07 for British Aerospace Regional Aircraft Model HP 137 Jetstream MK1, Jetstream Series 200, and Jetstream Series 3101 airplanes. This AD results from mandatory continuing airworthiness information (MCAI) issued by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as cracking of the forward main landing gear yoke pintle resulting from corrosion pits leading to stress corrosion cracking. We are issuing this AD to require actions to address the unsafe condition on these products.

    DATES:

    This AD is effective July 5, 2017.

    The Director of the Federal Register approved the incorporation by reference of a certain publications listed in the AD as of July 5, 2017.

    ADDRESSES:

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0053; or in person at the Docket Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    For service information identified in this AD, BAE Systems (Operations) Ltd, Customer Information Department, Prestwick International Airport, Ayrshire, KA9 2RW, Scotland, United Kingdom; phone: +44 1292 675207; fax: +44 1292 675704; email: [email protected]; Internet: http://www.jetstreamcentral.com. You may view this referenced service information at the FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For information on the availability of this material at the FAA, call (816) 329-4148. It is also available on the Internet at http://www.regulations.gov by searching for Docket No. FAA-2017-0053.

    FOR FURTHER INFORMATION CONTACT:

    Doug Rudolph, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4059; fax: (816) 329-4090; email: [email protected]

    SUPPLEMENTARY INFORMATION: Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to British Aerospace Regional Aircraft Model HP 137 Jetstream MK1, Jetstream Series 200, and Jetstream Series 3101 airplanes. That NPRM was published in the Federal Register on February 17, 2017 (82 FR 10973), and proposed to supersede AD 2014-07-07, Amendment 39-17821 (79 FR 23897; April 29, 2014) (“2014-07-07”).

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

    Prompted by occurrences of the main landing gear (MLG) yoke pintle housing cracking, the Civil Aviation Authority (CAA) UK issued AD 003-01-86 to require repetitive inspections to detect cracks in the yoke pintle housing on MLG fitted to Jetstream 3100 aeroplanes in accordance with BAE Systems (Operations) Ltd Service Bulletin (SB) 32-A-JA851226, and, depending on findings, corrective action. After that AD was issued, an occurrence was reported of Jetstream 3100 MLG failure after landing. The subsequent investigation revealed stress corrosion cracking of the MLG yoke pintle housing to have caused this MLG failure. Furthermore, the investigation report recommended a review of the effectiveness of CAA UK AD 003-01-86 in finding cracks in the yoke pintle housing on MLG fitted to Jetstream 3100 aeroplanes.

    Degradation of the surface protection by abrasion can occur when the forward face of the yoke pintle rotates against the pintle bearing, which introduces corrosion pits and, consequently, stress corrosion cracking.

    This condition, if not detected and corrected, could lead to structural failure of the MLG, possibly resulting in loss of control of the aeroplane during take-off or landing runs.

    To provide protection of the affected area of the MLG assembly spigot housing, BAE Systems (Operations) Ltd issued SB 32-JM7862 to provide instructions for installation of a protective washer, fitted at the forward spigot on both left hand and right hand MLG. Consequently, BAE Systems (Operations) Ltd issued SB 32-A-JA851226 Revision 05 to provide additional accomplishment instructions for a Non-destructive testing (NDT) inspection of MLG equipped with the protective washer installed in accordance with BAE Systems (Operations) Ltd SB 32-JM7862.

    Consequently, EASA issued AD 2013-0208, retaining the requirements of CAA UK AD 003-01-86, which was superseded, and required implementation of revised inspection requirements, and, depending on findings, accomplishment of applicable corrective action(s). That AD also introduced an optional modification, which constituted terminating action for the inspections required by that AD.

    Since that AD was issued, BAE Systems (Operations) Ltd has determined that the existing inspection procedure may not be effective in identifying stress corrosion cracking in the pintle housing. Consequently BAE Systems (Operations) Ltd has published an improved inspection procedure in SB 32-A-JA851226 Revision 07. This improved inspection procedure has the ability to detect smaller corrosion pits and cracks that are proximate in size to those that will initiate stress corrosion.

    For the reasons described above, this [EASA] AD retains the requirements of EASA AD 2013-0208, which is superseded, and requires MLG inspections in accordance with the improved procedure.

    The MCAI can be found in the AD docket on the Internet at: https://www.regulations.gov/document?D=FAA-2017-0053-0002. Comments

    We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM or on the determination of the cost to the public.

    Conclusion

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

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

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

    Related Service Information

    We reviewed British Aerospace Jetstream Series 3100 & 3200 Service Bulletin 32-A-JA851226, Revision 7, dated May 25, 2015. The service information describes procedures for nondestructive testing (NDT) and visual inspections of the main landing gear spigot housing for cracks and repair if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section of the final rule.

    Costs of Compliance

    We estimate that this AD will affect 26 products of U.S. registry. We also estimate that it would take about 14 work-hours per product to comply with the basic requirements of this AD. The average labor rate is $85 per work-hour.

    Based on these figures, we estimate this cost of the AD on U.S. operators to be $30,940, or $1,190 per product.

    In addition, we estimate that any necessary follow-on actions would take about 2 work-hours and require parts costing $5,000, for a cost of $5,170 per product. We have no way of determining the number of products that may need these actions.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this AD:

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

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

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

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

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0053; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains the NPRM, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone (800) 647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    List of Subjects in 14 CFR Part 39

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

    Adoption of the Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by removing Amendment 39-17821 (82 FR 23897; April 29, 2014), and adding the following new AD: 2017-10-14 British Aerospace Regional Aircraft: Amendment 39-18888; Docket No. FAA-2017-0053; Directorate Identifier 2016-CE-037-AD. (a) Effective Date

    This airworthiness directive (AD) becomes effective July 5, 2017.

    (b) Affected ADs

    This AD supersedes AD 2014-07-07, Amendment 39-17821 (79 FR 23897, April 29, 2014) (“2014-07-07”).

    (c) Applicability

    This AD applies to British Aerospace (Operations) Limited Model HP.137 Jetstream Mk.1, Jetstream Series 200, and Jetstream Series 3101 airplanes, all serial numbers, certificated in any category.

    (d) Subject

    Air Transport Association of America (ATA) Code 32: Landing Gear.

    (e) Reason

    This AD was prompted by mandatory continuing airworthiness information (MCAI) issued by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as cracking of the forward main landing gear yoke pintle resulting from corrosion pits which can cause stress corrosion cracking resulting in loss of control during take-off or landing. We are issuing this AD to revise the inspection procedure to detect smaller corrosion pits and cracks that could initiate stress corrosion cracking.

    (f) Actions and Compliance

    Unless already done, do the following actions specified in paragraphs (f)(1) through (11) of this AD:

    (1) For all airplanes: Before or at the next inspection that would have been required by AD 2014-07-07 or within the next 30 days after July 5, 2017 (the effective date of this AD), whichever occurs later, and repetitively thereafter at intervals not to exceed 12 months or 1,200 main landing gear (MLG) flight cycles (FC), whichever occurs first, do a nondestructive testing (NDT) inspection of each MLG assembly cylinder attachment spigot housing following the accomplishment instructions in Heroux Devtek Service Bulletin (SB) 32-19, Revision 7, dated March 16, 2015, as specified in the accomplishment instructions in paragraph 2.B. Part A of British Aerospace Jetstream Series 3100 & 3200 SB 32-A-JA851226, Revision 7, dated May 25, 2015.

    (2) For all airplanes: Within 300 landings after a heavy or abnormal landing or within 3 months after a heavy or abnormal landing, whichever occurs first, do an NDT inspection of each MLG assembly cylinder attachment spigot housing following the accomplishment instructions in Heroux Devtek Service Bulletin (SB) 32-19, Revision 7, dated March 16, 2015, as specified in the accomplishment instructions in paragraph 2.B. Part A of British Aerospace Jetstream Series 3100 & 3200 SB 32-A-JA851226, Revision 7, dated May 25, 2015.

    (3) For all airplanes: Within 3 months after accomplishment of the latest NDT inspection required by paragraph (f)(1) of this AD or 300 MLG FC after accomplishment of the latest NDT inspection required by paragraph (f)(1) of this AD, whichever occurs first, and repetitively thereafter at intervals not to exceed 3 months or within 300 MLG FC, whichever occurs first, do a visual inspection of each MLG following the accomplishment instructions in paragraph 2.B. Part B of British Aerospace Jetstream Series 3100 & 3200 SB 32-A-JA851226, Revision 7, dated May 25, 2015. These inspections start over after every repetitive NDT inspection required by paragraph (f)(1)of this AD.

    (4) For all airplanes with a MLG incorporating a microswitch hole: Within the next 10,600 MLG FC since new and repetitively thereafter at intervals not to exceed 1,200 MLG flight cycles, do an NDT inspection of each MLG microswitch hole following the accomplishment instructions in paragraph 2.B. Part C of British Aerospace Jetstream Series 3100 & 3200 SB 32-A-JA851226, Revision 7, dated May 25, 2015.

    (5) For all airplanes: If any discrepancy is found during any NDT inspection required in paragraphs (f)(1), (2), or (4) of this AD, before further flight, take all necessary corrective actions following the instructions in British Aerospace Jetstream Series 3100 & 3200 SB 32-A-JA851226, Revision 7, dated May 25, 2015.

    (6) For all airplanes: If any discrepancy is found during any visual inspection required in paragraph (f)(3) of this AD, before further flight, take all necessary corrective actions following the instructions in British Aerospace Jetstream Series 3100 & 3200 SB 32-A-JA851226, Revision 7, dated May 25, 2015.

    (7) For all airplanes: Doing all necessary corrective actions required in paragraphs (f)(5) or (6) of this AD does not constitute terminating action for the inspections required by this AD.

    (8) For all airplanes: Modification of each MLG cylinder following BAE Systems (Operations) Ltd. SB 32-JA880340 original issue, dated January 6, 1989, constitutes terminating action for the inspections required by this AD for that MLG.

    (9) For all airplanes: The compliance times in paragraphs (f)(1), (2), (3), and (4) of this AD are presented in flight cycles (landings). If the total flight cycles have not been kept, multiply the total number of airplane hours time-in-service (TIS) by 0.75 to calculate the cycles. For the purposes of this AD:

    (i) 100 hours TIS × .75 = 75 cycles; and

    (ii) 1,000 hours TIS × .75 = 750 cycles.

    (g) Credit for Actions Done in Accordance With Previous Service Information

    (1) This AD allows credit for the initial inspection required in paragraph (f)(1) of this AD if done before June 3, 2014 (the effective date retained from AD 2014-07-07) following British Aerospace Jetstream Series 3100 & 3200 Service Bulletin 32-A-JA851226, Revision 5, dated April 30, 2013.

    (2) This AD allows credit for the initial inspection required in paragraph (f)(4) of this AD if done before June 3, 2014 (the effective date retained from AD 2014-07-07) following APPH Ltd. Service Bulletin 32-40, at Initial Issue dated June 21, 1989; or APPH Ltd. Service Bulletin 32-40, Revision 1, dated February, 2003.

    (h) Other FAA AD Provisions

    The following provisions also apply to this AD:

    (1) Alternative Methods of Compliance (AMOCs): The Manager, Standards Office, FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. Send information to ATTN: Doug Rudolph, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4059; fax: (816) 329-4090; email: [email protected] Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector (PI) in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO.

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

    (3) Reporting Requirements: For any reporting requirement in this AD, a federal agency may not conduct or sponsor, and a person is not required to respond to, nor shall a person be subject to a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a current valid OMB Control Number. The OMB Control Number for this information collection is 2120-0056. Public reporting for this collection of information is estimated to be approximately 5 minutes per response, including the time for reviewing instructions, completing and reviewing the collection of information. All responses to this collection of information are mandatory. Comments concerning the accuracy of this burden and suggestions for reducing the burden should be directed to the FAA at: 800 Independence Ave. SW., Washington, DC 20591, Attn: Information Collection Clearance Officer, AES-200.

    (i) Related Information

    Refer to MCAI European Aviation Safety Agency (EASA) AD No.: 2016-0224, dated November 9, 2016, for related information. The MCAI can be found in the AD docket on the Internet at: https://www.regulations.gov/document?D=FAA-2017-0053-0002.

    (j) Material Incorporated by Reference

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

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

    (i) British Aerospace Jetstream Series 3100 & 3200 Service Bulletin 32-A-JA851226, Revision 7, dated May 25, 2015.

    (ii) Heroux Devtek Service Bulletin 32-19, Revision 7, dated March 16, 2015.

    (3) For British Aerospace Regional Aircraft service information identified in this AD, contact BAE Systems (Operations) Ltd, Customer Information Department, Prestwick International Airport, Ayrshire, KA9 2RW, Scotland, United Kingdom; phone: +44 1292 675207, fax: +44 1292 675704; email: [email protected]; Internet: http://www.jetstreamcentral.com.

    (4) You may review copies of the referenced service information at the FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For information on the availability of this material at the FAA, call (816) 329-4148. In addition, you can access this service information on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0053.

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

    Issued in Kansas City, Missouri, on May 10, 2017. Melvin Johnson, Acting Manager, Small Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10408 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-6667; Directorate Identifier 2015-NM-125-AD; Amendment 39-18882; AD 2017-10-08] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final rule.

    SUMMARY:

    We are superseding Airworthiness Directive (AD) 2009-21-01 for certain The Boeing Company Model 737-300 and 737-400 series airplanes. AD 2009-21-01 required repetitive inspections to detect cracking of the aft fuselage skin, and related investigative and corrective actions if necessary. This new AD adds certain inspections, repairs, replacement, related investigative and corrective actions if necessary; and removes certain airplanes from the applicability. This AD was prompted by an evaluation by the design approval holder (DAH) indicating that the aft fuselage skin is subject to widespread fatigue damage (WFD), and by reports of aft fuselage cracking. We are issuing this AD to address the unsafe condition on these products.

    DATES:

    This AD is effective July 5, 2017.

    The Director of the Federal Register approved the incorporation by reference of a certain publication listed in this AD as of July 5, 2017.

    ADDRESSES:

    For service information identified in this final rule, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1717; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6667.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6667; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The address for the Docket Office (phone: 800-647-5527) is Docket Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    FOR FURTHER INFORMATION CONTACT:

    Jennifer Tsakoumakis, Aerospace Engineer, Airframe Branch, ANM-120L, FAA, Los Angeles Aircraft Certification Office (ACO), 3960 Paramount Boulevard, Lakewood, CA 90712-4137; phone: 562-627-5264; fax: 562-627-5210; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2009-21-01, Amendment 39-16038 (74 FR 52395, October 13, 2009) (“AD 2009-21-01”). AD 2009-21-01 applied to certain the Boeing Company Model 737-300 and 737-400 series airplanes. The NPRM published in the Federal Register on May 13, 2016 (81 FR 29802). The NPRM was prompted by an evaluation by the DAH indicating that the aft fuselage skin is subject to WFD, and by reports of aft fuselage cracking. The NPRM proposed to continue to require repetitive inspections to detect cracking of the aft fuselage skin, and related investigative and corrective actions if necessary. The NPRM also proposed to add new aft fuselage skin inspections for cracking, inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers, permanent repairs of time-limited repairs, related investigative and corrective actions if necessary, and skin panel replacement. The NPRM also proposed to remove Model 737-400 series airplanes from the applicability. We are issuing this AD to detect and correct cracking in the aft fuselage skin along the longitudinal edges of the chem-milled pockets in the bonded skin doubler, which could result in possible rapid decompression and reduced structural integrity of the airplane.

    Comments

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

    Request To Revise the Precipitating Event Statement

    Boeing requested that we revise the precipitating event statement by including that there have been reports of aft fuselage cracking. Boeing stated that this revision would be consistent with wording of other related rulemaking.

    We agree with Boeing's request because it provides additional clarity to the precipitating event statement. We have revised the SUMMARY and Discussion sections, and paragraph (e) of this AD accordingly.

    Request To Require Reinstalling Lap Joint Modification

    Jet2.com Limited (Jet2) requested that we revise the NPRM to require reinstalling the lap joint modification previously installed in accordance with AD 2015-21-06, Amendment 39-18298 (80 FR 69839, November 12, 2015) (“AD 2015-21-06”), which requires the S-14 lap joint to be trimmed out prior to 50,000 total flight cycles. Jet2 stated that Boeing Special Attention Service Bulletin 737-53-1168, Revision 4, dated June 3, 2015 (“SASB 737-53-1168, Revision 4”) specifies reinstalling the lap joint modification.

    We do not agree with the commenter's request. The modification required in AD 2015-21-06 consists of trimming out the lap splice, such that if this modification were installed, it would be impossible to install a new skin without reinstalling the lap modification. If the instructions in SASB 737-53-1168, Revision 4, to reinstall the lap splice modification were accidently overlooked, it would become clear to the installer that the reinstallation would be required. We have not changed this AD in this regard.

    Request To Address Certain Repairs

    Boeing requested that we add a paragraph to the proposed AD to address repairs that are installed on the airplane for reasons other than chem-mill cracking. Boeing submitted suggested language and pointed out that the additional language is similar to that in other rulemaking.

    We disagree with Boeing's request. Part 1 of the Accomplishment Instructions of SASB 737-53-1168, Revision 4, does not make a distinction regarding why an existing repair was installed. Therefore, repairs installed for damage other than a chem-mill crack are already addressed. We have not changed this AD in this regard.

    Request To Revise Proposed Compliance Time

    Boeing requested that we revise paragraph (h)(4) of the proposed AD to do the actions at an initial compliance time obtained through the alternative method of compliance (AMOC) process specified in paragraph (n)(1) of the proposed AD. Boeing stated that the repetitive inspections would still be done at the times specified in the service information. Boeing also requested that we include in the paragraph revision the terminating action of skin panel replacement at the time approved through an AMOC. Boeing stated that its request would provide a reset on the compliance times if the skin panel was replaced prior to 53,000 total airplane cycles. Boeing explained that its authorized representative under the Boeing Commercial Airplanes Organization Designation Authorization (ODA) cannot approve extensions to the compliance times.

    We partially agree with Boeing's request. We agree that, for airplanes with skin panels replaced prior to 53,000 total flight cycles, in order to reset the inspection threshold on the replaced skin panels, approval must come from the FAA. Under the provisions of paragraph (n) of this AD, we may consider requests for a reset of the compliance times if the skin panel was replaced prior to 53,000 total airplane cycles if data are submitted to substantiate that such an adjustment would provide an acceptable level of safety. We have not changed this AD in this regard.

    Request To Specify the Service Information Accomplishment Instructions Part Numbers

    Boeing requested that we add the specific part of the accomplishment instructions in paragraphs (i)(1)(ii), (i)(2)(ii), and (j) of the proposed AD. Boeing stated that paragraph (g) of the proposed AD specifies the specific part number, and that this change would make these paragraphs consistent with the wording in paragraph (g) of the proposed AD.

    We agree with Boeing's request. We agree that specifying the specific part of the Accomplishment Instructions of SASB 737-53-1168, Revision 4, will add clarity to the AD. We have revised paragraphs (i)(1)(ii), (i)(2)(ii), and (j) of this AD accordingly.

    Request To Revise Flight Cycle Limit for Replacement Kit Skin Panels

    Boeing requested that we revise paragraph (l) of the proposed AD to specify that skin panel replacements using the kit identified in SASB 737-53-1168, Revision 4, do not have the lower flight cycle limit restriction that the production skin panel replacements have.

    We agree with Boeing's request because the skin panel replacements using the kit identified in SASB 737-53-1168, Revision 4, is an improved design compared to the production skin panels, and therefore, do not need the lower flight cycle limit restriction. We have added paragraph (l)(3) to this AD, which states, in part, that if the skin panel is replaced with a kit skin panel as specified in SASB 737-53-1168, Revision 4, the 53,000 total flight cycle limit does not apply.

    Request To Remove Flight-Cycle Restriction for Certain Actions

    Boeing requested that we revise paragraphs (m)(2), (m)(3), and (n)(5) of the proposed AD to remove the flight cycle restriction for certain previously accomplished actions using certain service information. Boeing stated that the only skin panel replacements specified in previous revisions of SASB 737-53-1168 are those using the kit panels, and that those panels do not have the flight-cycle limit specified in paragraphs (m)(2), (m)(3), and (n)(5) of the proposed AD.

    We agree with the commenter's request because the skin panel replacements using the kit identified in SASB 737-53-1168, Revision 4, are an improved design compared to the production skin panels, and therefore, do not need the lower flight cycle limit restriction. We have revised paragraphs (m)(2), (m)(3), and (n)(5) of this AD accordingly.

    Request To Specify Terminating Action

    Qantas Airways Limited (Qantas) requested that we revise paragraphs (g) and (l) of the proposed AD to specify terminating action. Qantas pointed out that replacing the skin panels with kit panels instead of production panels, as specified in SASB 737-53-1168, terminates the repetitive inspections identified in paragraphs (g), (i), and (j) of the proposed AD. Additionally, Qantas pointed out that replacement with kit skin panels using any revision of SASB 737-53-1168 before the effective date of the AD should also terminate the repetitive inspections identified in paragraphs (g), (i), and (j) of the proposed AD.

    We agree with the commenter's request because the skin panel replacements using the kit identified in SASB 737-53-1168, Revision 4, are an improved design compared to the production skin panels and therefore, should terminate the repetitive inspections. We have revised paragraphs (m)(2), (m)(3), and (n)(5) of this AD accordingly.

    Effect of Winglets on Accomplishment of the Proposed Actions

    Aviation Partners Boeing stated that accomplishing Supplemental Type Certificate (STC) ST01219SE does not affect the actions specified in the NPRM.

    We concur with the commenter. We have redesignated paragraph (c) of the proposed AD as paragraph (c)(1) of this AD and added paragraph (c)(2) to this AD to state that installation of STC ST01219SE does not affect the ability to accomplish the actions required by this final rule. Therefore, for airplanes on which STC ST01219SE is installed, a “change in product” AMOC approval request is not necessary to comply with the requirements of 14 CFR 39.17.

    Conclusion

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

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

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

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

    Related Service Information Under 1 CFR Part 51

    We reviewed SASB 737-53-1168, Revision 4. The service information describes procedures for doing inspections of the fuselage skin, repairs, and skin panel replacement. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    Costs of Compliance

    We estimate that this AD affects 168 airplanes of U.S. registry.

    We estimate the following costs to comply with this AD:

    Estimated Costs Action Labor cost Parts cost Cost per product Cost on U.S.
  • operators
  • Inspections Up to 1,791 work-hours × $85 per hour = $152,235 $0 Up to $152,235 Up to $25,575,480. Skin replacement 624 work-hours × $85 per hour = $53,040 98,275 $151,315 $25,420,920.

    We estimate the following costs to do any necessary repairs that would be required based on the results of the inspections. We have no way of determining the number of aircraft that might need these repairs:

    On-Condition Costs Action Labor cost Parts cost Cost per product Time-limited repair 24 work-hours × $85 per hour = $2,040 per repair (1) $2,040 per repair. Permanent repair Up to 43 work-hours × $85 per hour = $3,655 per repair (1) Up to $3,655 per repair. 1 We have received no definitive data that would enable us to provide the part cost estimates for the on-condition actions specified in this AD.

    We estimate the following costs to do any necessary post-repair inspections that would be required. We have no way of determining the number of aircraft that might need these inspections:

    Post-Repair Inspection Costs Action Labor cost Parts cost Cost per product Post-repair inspection Up to 7 work-hours × $85 per hour = $595 $0 Up to $595. Authority for This Rulemaking

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

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

    Regulatory Findings

    We 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.

    List of Subjects in 14 CFR Part 39

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

    Adoption of the Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by removing Airworthiness Directive (AD) 2009-21-01, Amendment 39-16038 (74 FR 52395, October 13, 2009), and adding the following new AD: 2017-10-08 The Boeing Company: Amendment 39-18882; Docket No. FAA-2016-6667; Directorate Identifier 2015-NM-125-AD. (a) Effective Date

    This AD is effective July 5, 2017.

    (b) Affected ADs

    This AD replaces AD 2009-21-01, Amendment 39-16038 (74 FR 52395, October 13, 2009) (“AD 2009-21-01”).

    (c) Applicability

    (1) This AD applies to The Boeing Company Model 737-300 series airplanes, certificated in any category, as identified in Boeing Special Attention Service Bulletin 737-53-1168, Revision 4, dated June 3, 2015 (“SASB 737-53-1168, Revision 4”).

    (2) Installation of Supplemental Type Certificate (STC) ST01219SE (http://rgl.faa.gov/Regulatory_and_Guidance_Library/rgstc.nsf/0/ebd1cec7b301293e86257cb30045557a/$FILE/ST01219SE.pdf) does not affect the ability to accomplish the actions required by this AD. Therefore, for airplanes on which STC ST01219SE is installed, a “change in product” alternative method of compliance (AMOC) approval request is not necessary to comply with the requirements of 14 CFR 39.17.

    (d) Subject

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

    (e) Unsafe Condition

    This AD was prompted by an evaluation by the design approval holder (DAH) indicating that the aft fuselage skin is subject to widespread fatigue damage (WFD), and reports of aft fuselage cracking. We are issuing this AD to detect and correct cracking in the aft fuselage skin along the longitudinal edges of the chem-milled pockets in the bonded skin doubler, which could result in possible rapid decompression and reduced structural integrity of the airplane.

    (f) Compliance

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

    (g) Inspections, Related Investigative and Corrective Actions

    At the applicable times specified in tables 1 and 2 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, except as required by paragraphs (h)(1) and (h)(2) of this AD: Do the applicable inspections to detect cracks in the aft fuselage skin panels, and do all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraphs (h)(3) and (h)(4) of this AD. Do all applicable related investigative and corrective actions before further flight. Repeat the applicable inspections thereafter at the applicable intervals specified in tables 1 and 2 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4. Accomplishment of a repair in accordance with “Part 4: Repair” of the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraph (h)(3) of this AD, is terminating action for the repetitive inspections required by this paragraph at the repaired locations only.

    (h) Exceptions to SASB 737-53-1168, Revision 4

    (1) Where SASB 737-53-1168, Revision 4, specifies compliance times “after the Revision 4 date of this service bulletin,” this AD requires compliance within the specified compliance times after the effective date of this AD.

    (2) The Condition column of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, refers to airplanes in certain configurations as of the “issue date of Revision 4 of this service bulletin.” However, this AD applies to airplanes in the specified configurations “as of the effective date of this AD.”

    (3) Where SASB 737-53-1168, Revision 4, specifies contacting Boeing for repair instructions or work instructions, before further flight, repair or perform the work instructions using a method approved in accordance with the procedures specified in paragraph (n) of this AD, except as required by paragraph (h)(4) of this AD.

    (4) For airplanes on which an operator has a record that a skin panel was replaced with a production skin panel before 53,000 total flight cycles: At the applicable time for the next inspection as specified in tables 1 and 2 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, except as provided by paragraph (h)(1) and (h)(2) of this AD, perform inspections and applicable corrective actions using a method approved in accordance with the procedures specified in paragraph (n) of this AD.

    (i) Actions for Airplanes With a Time-Limited Repair Installed

    (1) For airplanes with a time-limited repair installed, as specified in Boeing Service Bulletin 737-53-1168, Revision 3, dated November 28, 2006: At the applicable times specified in table 3 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, except as provided by paragraphs (h)(1) and (h)(2) of this AD, do the actions specified in paragraphs (i)(1)(i) and (i)(1)(ii) of this AD.

    (i) Do the applicable inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers, and do all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Repeat the applicable inspections thereafter at the applicable intervals specified in SASB 737-53-1168, Revision 4.

    (ii) Make the time-limited repair permanent, and do all applicable related investigative and corrective actions, in accordance with Part 6 of the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Accomplishing the permanent repair required by this paragraph terminates the inspections required by paragraph (i)(1)(i) of this AD for the permanently repaired area only.

    (2) For airplanes with a time-limited repair installed, as specified in SASB 737-53-1168, Revision 4: At the applicable times specified in table 4 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, do the actions specified in paragraphs (i)(2)(i) and (i)(2)(ii) of this AD.

    (i) Do the applicable inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers, and do all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Repeat the applicable inspections thereafter at the applicable intervals specified in table 4 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4.

    (ii) Make the time-limited repair permanent, and do all applicable related investigative and corrective actions, in accordance with Part 6 of the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Accomplishing the permanent repair required by this paragraph terminates the inspections required by paragraph (i)(2)(i) of this AD for the permanently repaired area only.

    (j) Modification of Certain Permanent Repairs

    For airplanes with an existing time-limited repair that was made permanent, as specified in Boeing Service Bulletin 737-53-1168, Revision 3, dated November 28, 2006: At the applicable times specified in table 5 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, except as provided by paragraphs (h)(1) of this AD, modify the existing permanent repair, and do all applicable related investigative and corrective actions, in accordance with Part 6 of the Accomplishment Instructions of SASB 737-53-1168, Revision 4, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight.

    (k) Post-Repair Inspections

    Table 6 of paragraph 1.E., “Compliance,” of SASB 737-53-1168, Revision 4, specifies post-repair airworthiness limitation inspections in compliance with 14 CFR 25.571(a)(3) at the repaired locations, which support compliance with 14 CFR 121.1109(c)(2) or 129.109(b)(2). As airworthiness limitations, these inspections are required by maintenance and operational rules. It is therefore unnecessary to mandate them in this AD. Deviations from these inspections require FAA approval, but do not require an AMOC.

    (l) Skin Panel Replacement

    At the later of the times specified in paragraphs (l)(1), (1)(2), and (l)(3) of this AD: Replace the applicable skin panels, and do all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of SASB 737-53-1168, Revision 4. Do all applicable related investigative and corrective actions before further flight. Doing the skin panel replacement required by this paragraph terminates the inspection requirements of paragraphs (g), (i), and (j) of this AD for that skin panel only, provided the skin panel replacement was done with a production skin panel after 53,000 total flight cycles.

    (1) Before 60,000 total flight cycles, but not before 53,000 total flight cycles.

    (2) Within 6,000 flight cycles after the effective date of this AD, but not before 53,000 total flight cycles.

    (3) If the skin panel is replaced with a production skin panel, not before 53,000 total flight cycles. If the skin panel is replaced with a kit skin panel as specified in SASB 737-53-1168, Revision 4, the 53,000 total flight cycle limit does not apply.

    (m) Credit for Previous Actions

    (1) This paragraph provides credit for the actions required by paragraph (g) of this AD, if those actions were performed before the effective date of this AD using Boeing Service Bulletin 737-53-1168, Revision 3, dated November 28, 2006, except as required by paragraph (h)(4) of this AD. Boeing Service Bulletin 737-53-1168, Revision 3, dated November 28, 2006, was incorporated by reference in AD 2009-21-01.

    (2) This paragraph provides credit for the actions required by paragraph (l) of this AD, if those actions were performed before the effective date of this AD using Boeing Service Bulletin 737-53-1168, Revision 3, dated November 28, 2006, except as required by paragraph (h)(4) of this AD. Boeing Service Bulletin 737-53-1168, Revision 3, dated November 28, 2006, was incorporated by reference in AD 2009-21-01.

    (3) This paragraph provides credit for the actions required by paragraph (l) of this AD, if those actions were performed before November 17, 2009 (the effective date of AD 2009-21-01), using any service information specified in paragraphs (m)(3)(i), (m)(3)(ii), and (m)(3)(iii) of this AD, provided the replacement is made with a kit skin panel, except as required by paragraph (h)(4) of this AD. The service information specified in paragraphs (m)(3)(i), (m)(3)(ii), and (m)(3)(iii) of this AD was incorporated by reference in AD 2009-21-01.

    (i) Part 3 of the Accomplishment Instructions of Boeing Service Bulletin 737-53-1168, dated March 16, 1995.

    (ii) Part 3 of the Accomplishment Instructions of Boeing Service Bulletin 737-53-1168, Revision 1, dated August 17, 1995.

    (iii) Part 3 of the Accomplishment Instructions of Boeing Service Bulletin 737-53-1168, Revision 2, dated November 27, 1996.

    (n) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Los Angeles Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (o)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Seattle ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane and the approval must specifically refer to this AD.

    (4) AMOCs approved previously for repairs required by AD 2009-21-01 are approved as AMOCs for the corresponding provisions of paragraph (g) of this AD.

    (5) AMOCs approved previously for modifications done as optional terminating action for AD 2009-21-01 are approved as AMOCs for the skin panel replacement required by paragraph (l) of this AD.

    (o) Related Information

    (1) For more information about this AD, contact Jennifer Tsakoumakis, Aerospace Engineer, Airframe Branch, ANM-120L, FAA, Los Angeles ACO, 3960 Paramount Boulevard, Lakewood, CA 90712-4137; phone: 562-627-5264; fax: 562-627-5210; email: [email protected]

    (2) Service information identified in this AD that is not incorporated by reference is available at the addresses specified in paragraphs (p)(3) and (p)(4) of this AD.

    (p) Material Incorporated by Reference

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

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

    (i) Boeing Special Attention Service Bulletin 737-53-1168, Revision 4, dated June 3, 2015.

    (ii) Reserved.

    (3) For Boeing service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1717; Internet https://www.myboeingfleet.com.

    (4) You may view this service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

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

    Issued in Renton, Washington, on May 2, 2017. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10288 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0156; Directorate Identifier 2017-CE-003-AD; Amendment 39-18877; AD 2017-10-03] RIN 2120-AA64 Airworthiness Directives; ZLIN AIRCRAFT a.s. Airplanes AGENCY:

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

    ACTION:

    Final rule.

    SUMMARY:

    We are superseding Airworthiness Directive (AD) 2003-11-12 for ZLIN AIRCRAFT a.s. Model Z-242L airplanes (type certificate previously held by MORAVAN a.s.). This AD results from mandatory continuing airworthiness information (MCAI) issued by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as a need to incorporate new revisions into the Limitations section, Chapter 9, of the FAA-approved maintenance program (e.g., maintenance manual) to impose new or more restrictive life limits on critical components. We are issuing this AD to require actions to address the unsafe condition on these products.

    DATES:

    This AD is effective July 5, 2017.

    The Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD as of July 5, 2017.

    The Director of the Federal Register approved the incorporation by reference of a certain other publication as of June 5, 2003 (68 FR 32629, June 2, 2003).

    ADDRESSES:

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0156; or in person at the Docket Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    For service information identified in this AD, contact ZLIN AIRCRAFT a.s., Letiště 1887, 765 02 Otrokovice, Czech Republic, telephone: +420 725 266 711; fax: +420 226 013 830; email: [email protected], Internet: http://www.zlinaircraft.eu. You may view this referenced service information at the FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For information on the availability of this material at the FAA, call (816) 329-4148. It is also available on the Internet at http://www.regulations.gov by searching for Docket No. FAA-2017-0156.

    FOR FURTHER INFORMATION CONTACT:

    Doug Rudolph, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4059; fax: (816) 329-4090; email: [email protected].

    SUPPLEMENTARY INFORMATION: Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to ZLIN AIRCRAFT a.s. Model Z-242L airplanes (type certificate previously held by MORAVAN a.s.). That NPRM was published in the Federal Register on March 2, 2017 (82 FR 12305), and proposed to supersede AD 2003-11-12, Amendment 39-13171 (68 FR 32629, June 2, 2003) (“AD 2003-11-12”).

    Since we issued AD 2003-11-12, a revision to the airworthiness limitations chapter of the aircraft maintenance manual has been issued, and the State of Design airworthiness authority took AD action, as identified below.

    The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Community, has issued AD No.: 2017-0005, dated January 10, 2017 (referred to after this as “the MCAI”), to correct an unsafe condition for the specified products. The MCAI states:

    The airworthiness limitations for the Zlin Aircraft a.s. Z 242 L aeroplanes, which are approved by EASA, are defined and published in Chapter 9 of Zlin Aircraft a.s. Z 242 L Maintenance Manual (MM)—Volume I Document 003.021.1 (in Czech language) or in Chapter 9 of Z 242 L MM—Volume I Document 003.22.1 (in English language). These instructions have been identified as mandatory for continued airworthiness.

    Failure to accomplish these instructions could result in an unsafe condition.

    Zlin Aircraft a.s. recently published Revision 22 to Chapter 9, Volume I, of the Z 242 L MM, introducing new and/or more restrictive limitations.

    For the reason described above, this [EASA] AD requires accomplishment of the actions specified in the Zlin Aircraft a.s. Z 242 L MM Chapter 9, Volume I, at Revision 22.

    The MCAI can be found in the AD docket on the Internet at https://www.regulations.gov/document?D=FAA-2017-0156-0002. Comments

    We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM or on the determination of the cost to the public.

    Conclusion

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

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

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

    Related Service Information Under 1 CFR 51

    We reviewed Chapter 9, Airworthiness Limitations, Revision No. 22, dated March 15, 2016, of ZLIN AIRCRAFT a.s. Z 242 L DOC. No. 003.22.1 Maintenance Manual-Vol. I., and Moravan-Aeroplanes a.s. Mandatory Service Bulletin Z 142C/17a, Z 242L/37a—Rev. 1, dated October 31, 2000. The revision to the Limitations sections introduces new and/or more restrictive safe life limits for the Model Z 242 airplane. The mandatory service bulletin describes procedures for annotating acrobatic and utility category operational time in the logbook. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section of this AD.

    Costs of Compliance

    We estimate that this AD will affect 30 products of U.S. registry. We also estimate that it will take about 1 work-hour per product to comply with the requirement to incorporate the new revision into the Limitations section of the FAA-approved maintenance program (e.g., maintenance manual). The average labor rate is $85 per work-hour.

    Based on these figures, we estimate the cost of this portion of this AD on U.S. operators to be $2,550, or $85 per product.

    The above costs only account for the time to incorporate the document into the Limitations section of the FAA-approved maintenance program. These limitations will impose more restrictive life limits on some parts and provide new life limits for others. While the cost of these replacements could be expensive, they will only be required to operate the airplane past the established times. Ultimately, the estimated cost of replacing all life-limited parts could come close to the cost of the airplane. These life limits are necessary to continue to operate the airplane in an airworthy manner.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this AD:

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

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

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

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

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0156; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains the NPRM, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone (800) 647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    List of Subjects in 14 CFR Part 39

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

    Adoption of the Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by removing Amendment 39-13171 (68 FR 32629, June 2, 2003), and adding the following new AD: 2017-10-03 ZLIN AIRCRAFT a.s. (type certificate previously held by MORAVAN a.s.): Amendment 39-18877; Docket No. FAA-2017-0156; Directorate Identifier 2017-CE-003-AD. (a) Effective Date

    This airworthiness directive (AD) becomes effective July 5, 2017.

    (b) Affected ADs

    This AD replaces AD 2003-11-12, Amendment 39-13171 (68 FR 32629, June 2, 2003) (“AD 2003-11-12”).

    (c) Applicability

    This AD applies to ZLIN AIRCRAFT a.s. Model Z-242L airplanes, all serial numbers, certificated in any category.

    (d) Subject

    Air Transport Association of America (ATA) Code 5: Time Limits.

    (e) Reason

    This AD was prompted by mandatory continuing airworthiness information (MCAI) originated by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as a need to incorporate new revisions into the Limitations section, Chapter 9, of the FAA-approved maintenance program (e.g., maintenance manual). We are issuing this AD to prevent structural failure of the wing due to fatigue cracking. Such failure could result in a wing separating from the airplane with consequent loss of control.

    (f) Actions and Compliance

    Unless already done, do the following actions:

    (1) For all affected airplanes: As of March 21, 2003 (the effective date of AD 2003-03-13 (68 FR 4905, January 21, 2003) (“AD 2003-03-13”)), annotate Acrobatic and Utility category operational time in the logbook. If the airplane is utilized in either of these categories at any time during a flight, annotate the total time for that flight in the Utility or Acrobatic category, as appropriate. Do the logbook annotation following the procedures in Moravan-Aeroplanes a.s. Mandatory Service Bulletin Z 142C/17a, Z 242L/37a—Rev. 1, dated October 31, 2000; and Moravan Mandatory Service Bulletin Z 242L/38a—Rev. 1, April 15, 2003. The owner/operator holding at least a private pilot certificate as authorized by section 43.7 may do this action.

    (2) For airplane serial numbers 0001 through 0656 that do not have strengthened wings installed (both left and right side) in accordance with Moravan Mandatory Service Bulletin Z 242L/27a—Rev. 1, dated October 31, 2000, or Rev. 2, dated April 15, 2003:

    (i) On or before 10 days after June 5, 2003 (the effective date of AD 2003-11-12), incorporate aerobatic frequency information into the Limitations section of the airplane flight manual (AFM) as specified in Moravan Mandatory Service Bulletin Z 242L/38a—Rev. 1, April 15, 2003. The owner/operator holding at least a private pilot certificate as authorized by section 43.7 may do this action. Make an entry into the aircraft records showing compliance with these portions of this AD in accordance with section 43.9 of the Federal Aviation Regulations (14 CFR 43.9).

    (ii) On or before reaching 190 hours time-in-service in the Acrobatic category and/or Utility category or on or before 90 days after March 21, 2003 (the effective date of AD 2003-03-13), whichever occurs later, insert the following information into the Limitations section of the airplane flight manual (AFM): “Do not operate in the Acrobatic or Utility category. Operate in the Normal category only.” The owner/operator holding at least a private pilot certificate as authorized by section 43.7 of the Federal Aviation Regulations (14 CFR 43.7) may accomplish this AFM insertion of this AD. Make an entry into the aircraft records showing compliance with these portions of this AD in accordance with section 43.9 of the Federal Aviation Regulations (14 CFR 43.9). This operational restriction is referenced in Moravan-Aeroplanes a.s. Mandatory Service Bulletin Z 142C/17a, Z 242L/37a—Rev. 1, dated October 31, 2000.

    (3) For airplane serial numbers 0657 or higher or one in the range of 0001 through 0656 that has strengthened wings (both left and right side) installed in accordance with Moravan Mandatory Service Bulletin Z 242L/27a—Rev. 1, dated October 31, 2000, or Rev. 2, dated April 15, 2003: On or before 10 days after June 5, 2003 (the effective date of AD 2003-11-12), incorporate aerobatic frequency information into the Limitations section of the airplane flight manual (AFM) as specified in Moravan Mandatory Service Bulletin Z 242L/38a—Rev.1, April 15, 2003. The owner/operator holding at least a private pilot certificate as authorized by section 43.7 may do this action. Make an entry into the aircraft records showing compliance with these portions of this AD in accordance with section 43.9 of the Federal Aviation Regulations (14 CFR 43.9).

    (4) For all affected airplanes: Within 10 days after July 5, 2017 (the effective date of this AD), insert Chapter 9, Airworthiness Limitations, Revision No. 22, dated March 15, 2016, of ZLIN AIRCRAFT a.s. Z 242 L, DOC. No. 003.22.1 Maintenance Manual-Vol. I into the Limitations section of the FAA-approved maintenance program (e.g., maintenance manual). The owner/operator holding at least a private pilot certificate as authorized by section 43.7 of the Federal Aviation Regulations (14 CFR 43.7) may accomplish this maintenance manual insertion requirement of this AD. Make an entry into the aircraft records showing compliance with these portions of this AD in accordance with section 43.9 of the Federal Aviation Regulations (14 CFR 43.9). If a discrepancy is found during the accomplishment of any of the actions required by the document listed in this paragraph, before further flight after finding such discrepancy, contact ZLIN AIRCRAFT a.s. at the address specified in paragraph (h) of this AD for an FAA-approved repair scheme and incorporate that repair scheme.

    (g) Other FAA AD Provisions

    The following provisions also apply to this AD:

    (1) Alternative Methods of Compliance (AMOCs): The Manager, Standards Office, FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. Send information to ATTN: Doug Rudolph, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4059; fax: (816) 329-4090; email: [email protected] Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector (PI) in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO.

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

    (h) Related Information

    Refer to MCAI European Aviation Safety Agency (EASA) AD No.: 2017-0005, dated January 10, 2017, for related information. The MCAI can be found in the AD docket on the Internet at https://www.regulations.gov/document?D=FAA-2017-0156-0002.

    (i) Material Incorporated by Reference

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

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

    (3) The following service information was approved for IBR on July 5, 2017 (the effective date of this AD).

    (i) Chapter 9, Airworthiness Limitations, Revision No. 22, dated March 15, 2016, of ZLIN AIRCRAFT a.s. Z 242 L DOC. No. 003.22.1 Maintenance Manual—Vol. I.

    (ii) Moravan-Aeroplanes a.s. Mandatory Service Bulletin Z 142C/17a, Z 242L/37a—Rev. 1, dated October 31, 2000.

    (4) The following service information was approved for IBR on June 5, 2003 (68 FR 32629, June 2, 2003).

    (i) Moravan Mandatory Service Bulletin Z 242L/38a—Rev.1, April 15, 2003.

    (ii) Reserved.

    (5) For service information identified in this AD, contact ZLIN AIRCRAFT a.s., Letiště 1887, 765 02 Otrokovice, Czech Republic, telephone: +420 725 266 711; fax: +420 226 013 830; email: [email protected], Internet: http://www.zlinaircraft.eu.

    (6) You may view this service information at FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For information on the availability of this material at the FAA, call 816-329-4148. In addition, you can access this service information on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0156.

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

    Issued in Kansas City, Missouri, on May 15, 2017. Melvin Johnson, Acting Manager, Small Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10406 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-6666; Directorate Identifier 2015-NM-124-AD; Amendment 39-18881; AD 2017-10-07] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final rule.

    SUMMARY:

    We are adopting a new airworthiness directive (AD) for certain The Boeing Company Model 737-400 series airplanes. This AD was prompted by an evaluation by the design approval holder (DAH), which indicates that the aft fuselage skin is subject to widespread fatigue damage (WFD), and reports of aft fuselage skin cracking. This AD requires repetitive inspections to detect cracking of the aft fuselage skin, inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers, permanent repairs of time-limited repairs, related investigative and corrective actions if necessary, and skin panel replacement. We are issuing this AD to address the unsafe condition on these products.

    DATES:

    This AD is effective July 5, 2017.

    The Director of the Federal Register approved the incorporation by reference of a certain publication listed in this AD as of July 5, 2017.

    ADDRESSES:

    For service information identified in this final rule, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone: 562-797-1717; Internet: https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6666.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6666; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The address for the Docket Office (phone: 800-647-5527) is Docket Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    FOR FURTHER INFORMATION CONTACT:

    Jennifer Tsakoumakis, Aerospace Engineer, Airframe Branch, ANM-120L, FAA, Los Angeles Aircraft Certification Office (ACO), 3960 Paramount Boulevard, Lakewood, CA 90712-4137; phone: 562-627-5264; fax: 562-627-5210; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Discussion

    We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to certain Boeing Model 737-400 series airplanes. The NPRM published in the Federal Register on May 13, 2016 (81 FR 29809) (“the NPRM”). The NPRM was prompted by an evaluation by the DAH, which indicates that the aft fuselage skin is subject to WFD, and reports of aft fuselage skin cracking. The NPRM proposed to require repetitive inspections to detect cracking of the aft fuselage skin, inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers, permanent repairs of time-limited repairs, related investigative and corrective actions if necessary, and skin panel replacement. We are issuing this AD to prevent cracking in the aft fuselage skin along the longitudinal edges of the bonded skin doubler, which could result in possible rapid decompression and reduced structural integrity of the airplane.

    Comments

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

    Request To Specify Repair Procedures

    Boeing requested that we revise the proposed AD to address repairs that are installed on the airplane for reasons other than chem-mill cracking. Boeing provided suggested language for the AD.

    We do not agree with Boeing's request. Paragraph 3.B.1 in the Accomplishment Instructions of Boeing Special Attention Service Bulletin 737-53-1187, Revision 3, dated July 10, 2015 (“SASB 737-53-1187 R3”), which is the referenced source of service information in this AD, already addresses the issue raised by Boeing. SASB 737-53-1187 R3 does not make a distinction between repairs installed for chem-mill cracking and repairs installed for other reasons. Therefore, repairs that are installed for any reason, provided they meet the service information criteria, are already addressed. We have not changed this AD in this regard.

    Request To Revise Compliance Time in Paragraph (h)(4) of the Proposed AD

    Boeing requested that we revise the compliance time in paragraph (h)(4) of the proposed AD from the time specified in SASB 737-53-1187 R3, to a time approved by the FAA through the alternative method of compliance (AMOC) process.

    Boeing provided examples of how replacing skin panels at certain compliance times would require further skin panel replacement before reaching the airplane limit of validity. Boeing explained that the NPRM proposed skin panel replacement at 60,000 total flight cycles; therefore, an FAA approval to adjust the compliance time from total flight cycles to cycles after skin panel replacement would be required.

    We partially agree with Boeing's request. Airplanes that have had a skin replacement with a production skin panel, as distinguished from an improved-design kit skin panel, prior to 53,000 total flight cycles may be eligible for an adjustment of the inspection threshold. Currently, such an adjustment of the AD compliance time is not delegated to Boeing's authorized representatives, and the change must be approved by the FAA. However, we consider the number of airplanes affected by this scenario to be quite small. Therefore, we have decided to approve such changes to the compliance times on a case-by-case basis using the procedures specified in paragraph (n)(1) of this AD. Although we agree with the comment, we have not changed this AD in this regard.

    Request To Reference Part 6 of the Service Information

    Boeing requested that we revise paragraphs (i)(1)(ii), (i)(2)(ii), and (j) of the proposed AD by specifying doing part 6 of the service information. Boeing stated that specifying the service information part reference would make the language consistent with paragraph (g) of the proposed AD, which specifies the service information part reference.

    We agree with Boeing's request. These changes will increase the paragraphs' clarity. We have revised paragraphs (i)(1)(ii), (i)(2)(ii), and (j) of this AD accordingly.

    Request To Revise Paragraph (l) of the Proposed AD

    Boeing requested that we revise the provision of paragraph (l) of the proposed AD, which would provide for terminating action if the skin panel was replaced with a production skin panel. Boeing indicated that terminating action should also apply to airplanes with the skin panel replacement kit (S-20 to S-25 (left and right)) specified in Boeing Service Bulletin 737-53-1187. Boeing stated that the skin panel replacement using the kit specified in Boeing Service Bulletin 737-53-1187 does not have the lower flight cycle limit restriction of the production panel replacement. Boeing explained that once the kit skin panel is replaced, the inspections specified in SASB 737-53-1187 R3, are terminated.

    We agree with Boeing's request. The kit skin panels are an improved design compared with the original production skin panels, have different inspection requirements, and provide terminating action. We have revised paragraph (l) of this AD accordingly.

    Request To Remove Flight Cycle Restriction in Paragraphs (m)(2), (m)(3), and (n)(5) of the Proposed AD

    Boeing requested that we revise paragraphs (m)(2), (m)(3), and (n)(5) of the proposed AD by removing the flight-cycle restriction for credit for the skin panel replacement. Boeing explained that the only skin panel replacement specified in the service information referenced in paragraphs (m)(2) and (m)(3) of the proposed AD is the skin panel replacement kit, which can be accomplished at any time.

    Boeing stated that it assumed that only the kit skin panel replacements, and not the original production skin panels, are approved as AMOCs for AD 2009-21-01, Amendment 39-16038 (74 FR 52395, October 13, 2009) (“AD 2009-21-01”). Boeing asserted that, therefore, paragraph (n)(5) of the proposed AD should approve previous modifications done as optional terminating action for AD 2009-21-01 as AMOCs for the modification required by paragraph (l) of this AD without the flight-cycle restriction.

    We partially agree with Boeing's request. The kit skin panels are an improved design compared with the original production skin panels and have different inspection requirements. We have revised paragraphs (m)(2) and (m)(3) of this AD by removing the flight-cycle restriction.

    However, in order to address airplanes that have had production skin panels replaced through AMOCs for AD 2009-21-01, paragraph (n)(5) of this AD retains the flight-cycle restriction.

    We agree to approve AMOCs for AD 2009-21-01 that require using the skin panel kit specified in Boeing Service Bulletin 737-53-1187 as AMOCs for the modification required by paragraph (l) of this AD without the flight-cycle restriction. We have added paragraph (n)(6) to this AD, which states that AMOCs approved for previous modifications done as optional terminating action for AD 2009-21-01 are approved as AMOCs for the modification required by paragraph (l) of this AD provided the skin modification replacement was done using the skin panel kit specified in Boeing Service Bulletin 737-53-1187.

    Conclusion

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

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

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

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

    Related Service Information Under 1 CFR Part 51

    We reviewed SASB 737-53-1187 R3. The service information describes procedures for doing inspections of the fuselage skin, repairs, and skin panel replacement. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    Costs of Compliance

    We estimate that this AD affects 84 airplanes of U.S. registry.

    We estimate the following costs to comply with this AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S.
  • operators
  • Inspections Up to 1,568 work-hours × $85 per hour = Up to $133,280 $0 Up to $133,280 Up to $11,195,520. Skin replacement 698 work-hours × $85 per hour = $59,330 185,147 $244,477 $20,536,068.

    We estimate the following costs to do any necessary repairs that would be required based on the results of the inspections. We have no way of determining the number of aircraft that might need these repairs:

    On-Condition Costs Action Labor cost Parts cost Cost per product Time-limited repair 24 work-hours × $85 per hour = $2,040 per repair (1) $2,040 per repair. Permanent repair Up to 39 work-hours × $85 per hour = $3,315 per repair (1) Up to $3,315 per repair. 1 We have received no definitive data that would enable us to provide the part cost estimates for the on-condition actions specified in this AD.

    We estimate the following costs to do any necessary post-repair inspections that would be required. We have no way of determining the number of aircraft that might need these inspections:

    Post-Repair Inspection Costs Action Labor cost Parts cost Cost per
  • product
  • Post-repair inspection Up to 7 work-hours × $85 per hour = $595 $0 Up to $595.
    Authority for This Rulemaking

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

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

    Regulatory Findings

    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.

    List of Subjects in 14 CFR Part 39

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

    Adoption of the Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): 2017-10-07 The Boeing Company: Amendment 39-18881; Docket No. FAA-2016-6666; Directorate Identifier 2015-NM-124-AD. (a) Effective Date

    This AD is effective July 5, 2017.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to Boeing Model 737-400 series airplanes, certificated in any category, as identified in Boeing Special Attention Service Bulletin 737-53-1187, Revision 3, dated July 10, 2015 (“SASB 737-53-1187 R3”).

    (d) Subject

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

    (e) Unsafe Condition

    This AD was prompted by an evaluation by the design approval holder (DAH) which indicates that the aft fuselage skin is subject to widespread fatigue damage (WFD) and reports of aft fuselage skin cracking. We are issuing this AD to detect and correct cracking in the aft fuselage skin along the longitudinal edges of the bonded skin doubler, which could result in possible rapid decompression and reduced structural integrity of the airplane.

    (f) Compliance

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

    (g) Inspections, Related Investigative and Corrective Actions

    At the applicable times specified in tables 1, 2, and 3 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, except as provided by paragraph (h)(1) and (h)(2) of this AD: Do the applicable inspections to detect cracks in the aft fuselage skin panels; and do all applicable related investigative and corrective actions; in accordance with the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraphs (h)(3) and (h)(4) of this AD. Do all applicable related investigative and corrective actions before further flight. Repeat the applicable inspections thereafter at the applicable intervals specified in tables 1, 2, and 3 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3. Accomplishment of a repair in accordance with “Part 4: Repair” of the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraph (h)(3) of this AD, is terminating action for the repetitive inspections required by this paragraph at the repaired locations only.

    (h) Exceptions to SASB 737-53-1187 R3

    (1) Where SASB 737-53-1187 R3, specifies compliance times “after the Revision 3 date of this service bulletin,” this AD requires compliance within the specified compliance times after the effective date of this AD.

    (2) The Condition column of Paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, refers to airplanes in certain configurations as of the “issue date of Revision 3 of this service bulletin.” However, this AD applies to airplanes in the specified configurations as of the effective date of this AD.

    (3) Where SASB 737-53-1187 R3 specifies contacting Boeing for repair instructions or work instructions, before further flight, repair or perform the work instructions using a method approved in accordance with the procedures specified in paragraph (n) of this AD, except as required by paragraph (h)(4) of this AD.

    (4) For airplanes on which an operator has a record that a skin panel was replaced with a production skin panel before 53,000 total flight cycles: At the applicable time for the next inspection as specified in tables 1, 2, and 3 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, except as provided by paragraph (h)(1) and (h)(2) of this AD: Perform inspections and applicable corrective actions using a method approved in accordance with the procedures specified in paragraph (n) of this AD.

    (i) Actions for Airplanes With a Time-Limited Repair Installed

    (1) For airplanes with a time-limited repair installed as specified in Boeing Service Bulletin 737-53-1187, Revision 2, dated May 9, 2007: At the applicable times specified in table 4 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, except as provided by paragraphs (h)(1) and (h)(2) of this AD: Do the actions specified in paragraphs (i)(1)(i) and (i)(1)(ii) of this AD.

    (i) Do the applicable inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers; and do all applicable related investigative and corrective actions; in accordance with the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Repeat the applicable inspections thereafter at the applicable intervals specified in table 4 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3.

    (ii) Make the time-limited repair permanent; and do all applicable related investigative and corrective actions; in accordance with Part 6 of the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Accomplishing the permanent repair required by this paragraph terminates the inspections required by paragraph (i)(1)(i) of this AD for the permanently repaired area only.

    (2) For airplanes with a time-limited repair installed as specified in SASB 737-53-1187 R3: At the applicable times specified in table 5 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, except as provided by paragraph (h)(2) of this AD: Do the actions specified in paragraphs (i)(2)(i) and (i)(2)(ii) of this AD.

    (i) Do the applicable inspections to detect missing or loose fasteners and any disbonding or cracking of bonded doublers; and do all applicable corrective actions; in accordance with the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraph (h)(3) of this AD. Do all applicable corrective actions before further flight. Repeat the applicable inspections thereafter at the applicable intervals specified in table 5 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3.

    (ii) Make the time-limited repair permanent; and do all applicable related investigative and corrective actions; in accordance with Part 6 of the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight. Accomplishing the permanent repair required by this paragraph terminates the inspections required by paragraph (i)(2)(i) of this AD for the permanently repaired area only.

    (j) Modification of Certain Permanent Repairs

    For airplanes with an existing time-limited repair that was made permanent as specified in Boeing Service Bulletin 737-53-1187, Revision 2, dated May 9, 2007: At the applicable time specified in table 6 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, except as provided by paragraph (h)(1) of this AD: Modify the existing permanent repair; and do all applicable related investigative and corrective actions; in accordance with Part 6 of the Accomplishment Instructions of SASB 737-53-1187 R3, except as required by paragraph (h)(3) of this AD. Do all applicable related investigative and corrective actions before further flight.

    (k) Post-Repair Inspections

    Table 7 of paragraph 1.E., “Compliance,” of SASB 737-53-1187 R3, specifies post-repair airworthiness limitation inspections in compliance with 14 CFR 25.571(a)(3) at the repaired locations, which support compliance with 14 CFR 121.1109(c)(2) or 129.109(b)(2). As airworthiness limitations, these inspections are required by maintenance and operational rules. It is therefore unnecessary to mandate them in this AD. Deviations from these inspections require FAA approval, but do not require an alternative method of compliance.

    (l) Skin Panel Replacement

    At the later of the times specified in paragraphs (l)(1) and (1)(2) of this AD: Replace the applicable skin panels, and do all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of SASB 737-53-1187 R3. Do all applicable related investigative and corrective actions before further flight. Doing the skin panel replacement required by this paragraph terminates the inspection requirements of paragraphs (g), (i), and (j) of this AD for that skin panel only, provided the skin panel replacement was done with a production skin panel after 53,000 total flight cycles, or with the skin panel replacement kit (S-20 to S-25 (left and right)) specified in Boeing Service Bulletin 737-53-1187.

    (1) Before 60,000 total flight cycles, but not before 53,000 total flight cycles.

    (2) Within 6,000 flight cycles after the effective date of this AD, but not before 53,000 total flight cycles.

    (m) Credit for Previous Actions

    (1) This paragraph provides credit for the actions required by paragraph (g) of this AD, if those actions were performed before the effective date of this AD using Boeing Service Bulletin 737-53-1187, Revision 2, dated May 9, 2007, except as required by paragraph (h)(4) of this AD. Boeing Service Bulletin 737-53-1187, Revision 2, dated May 9, 2007, was incorporated by reference in AD 2009-21-01, Amendment 39-16038 (74 FR 52395, October 13, 2009) (“AD 2009-21-01”).

    (2) This paragraph provides credit for the actions required by paragraph (l) of this AD, if those actions were performed before the effective date of this AD using Boeing Service Bulletin 737-53-1187, Revision 2, dated May 9, 2007, except as required by paragraph (h)(4) of this AD. Boeing Service Bulletin 737-53-1187, Revision 2, dated May 9, 2007, was incorporated by reference in AD 2009-21-01.

    (3) This paragraph provides credit for the actions required by paragraph (l) of this AD, if those actions were performed before November 17, 2009 (the effective date of AD 2009-21-01) using Part III of the Accomplishment Instructions of Boeing Service Bulletin 737-53-1187, dated November 2, 1995; or Part III of the Accomplishment Instructions of Boeing Service Bulletin 737-53-1187, Revision 1, dated January 16, 1997, except as required by paragraph (h)(4) of this AD. Boeing Service Bulletin 737-53-1187, dated November 2, 1995; and Boeing Service Bulletin 737-53-1187, Revision 1, dated January 16, 1997; are not incorporated by reference in this AD.

    (n) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Los Angeles Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (o)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Los Angeles ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane and the approval must specifically refer to this AD.

    (4) AMOCs approved for repairs for AD 2009-21-01 are approved as AMOCs for the corresponding provisions of paragraph (g) of this AD.

    (5) Except as specified in paragraph (n)(6) of this AD, AMOCs approved for previous modifications done as optional terminating action for AD 2009-21-01 are approved as AMOCs for the modification required by paragraph (l) of this AD provided the previous modification was done after the airplane had accumulated 53,000 total flight cycles or more.

    (6) AMOCs approved for previous modifications done as optional terminating action for AD 2009-21-01 are approved as AMOCs for the modification required by paragraph (l) of this AD provided the skin modification replacement is done using the skin panel kit specified Boeing Service Bulletin 737-53-1187.

    (o) Related Information

    (1) For more information about this AD, contact Jennifer Tsakoumakis, Aerospace Engineer, Airframe Branch, ANM-120L, FAA, Los Angeles ACO, 3960 Paramount Boulevard, Lakewood, CA 90712-4137; phone: 562-627-5264; fax: 562-627-5210; email: [email protected]

    (2) Service information identified in this AD that is not incorporated by reference is available at the addresses specified in paragraphs (p)(3) and (p)(4) of this AD.

    (p) Material Incorporated by Reference

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

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

    (i) Boeing Special Attention Service Bulletin 737-53-1187, Revision 3, dated July 10, 2015.

    (ii) Reserved.

    (3) For Boeing service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone: 562-797-1717; Internet: https://www.myboeingfleet.com.

    (4) You may view this service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

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

    Issued in Renton, Washington, on May 2, 2017. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10286 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    COMMODITY FUTURES TRADING COMMISSION 17 CFR Parts 1 and 23 RIN 3038-AE36 Recordkeeping AGENCY:

    Commodity Futures Trading Commission.

    ACTION:

    Final rule.

    SUMMARY:

    The Commodity Futures Trading Commission (the “Commission”) is amending the recordkeeping obligations set forth in Commission regulations along with corresponding technical changes to certain provisions regarding retention of oral communications and record retention requirements applicable to swap dealers and major swap participants, respectively. The amendments modernize and make technology neutral the form and manner in which regulatory records must be kept, as well as rationalize the rule text for ease of understanding for those persons required to keep records pursuant to the Commodity Exchange Act (the “CEA” or “Act”) and regulations promulgated by the Commission thereunder. The amendments do not alter any existing requirements regarding the types of regulatory records to be inspected, produced, and maintained set forth in other Commission regulations.

    DATES:

    The effective date for this final rule is August 28, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Eileen T. Flaherty, Director, (202) 418-5326, [email protected]; Frank Fisanich, Chief Counsel, (202) 418-5949, [email protected]; Andrew Chapin, Associate Chief Counsel, (202) 418-5465, [email protected]; Katherine Driscoll, Associate Chief Counsel, (202) 418-5544, [email protected]; C. Barry McCarty, Special Counsel, (202) 418-6627, [email protected]; or Jacob Chachkin, Special Counsel, (202) 418-5496, [email protected], Division of Swap Dealer and Intermediary Oversight, Commodity Futures Trading Commission, 1155 21st Street NW., Washington, DC 20581.

    SUPPLEMENTARY INFORMATION:

    I. Background

    In response to petitions for rulemaking from various industry groups requesting amendments to § 1.31, the Commission published in the Federal Register on January 19, 2017 a proposal (“Proposal”) to amend the recordkeeping obligations applicable to all persons required to keep records pursuant to the Act and Commission regulations promulgated thereunder (referred to in the Proposal as “records entities”).1 Regulation 1.31 sets forth the form and manner in which all regulatory records must be kept by records entities. Regulation 1.31 does not specify the types of regulatory records that must be kept, rather it specifies the form and manner in which regulatory records required by other Commission regulations are maintained and produced to the Commission. The proposed amendments to § 1.31, and related technical amendments to §§ 1.35 and 23.203, would modernize and make technology neutral the form and manner in which regulatory records must be kept, as well as rationalize the current rule text for ease of understanding. Under the proposed amendments, records entities would have greater flexibility regarding the retention and production of all regulatory records under a less-prescriptive, principles-based approach.

    1 Recordkeeping, 82 FR 6356 (Jan. 19, 2017).

    Among other proposed changes requested in the petitions for rulemaking, the Commission proposed to eliminate the requirement for a records entity to: (1) Keep electronic regulatory records in their native file format (i.e., in the format in which it was originally created); (2) retain any electronic record in a non-rewritable, non-erasable format (i.e., the “write once, read many” or “WORM” requirement); and (3) engage a third-party technical consultant and for the consultant to file certain representations with the Commission regarding access to the records entity's electronic regulatory records. These proposed changes would be universal to all records entities, including intermediaries registered or required to be registered with the Commission; registered entities such as designated contract markets, swap execution facilities, and derivatives clearing organizations; and any other persons required to produce certain regulatory records as set forth in other Commission regulations.

    II. Summary of Comments

    The Commission received sixteen comment letters on the Proposal from a wide range of records entities, including registrants, registered entities and other persons subject to the Commission's recordkeeping obligations set forth in § 1.31.2 All commenters generally supported the Commission's efforts to modernize and make technology neutral the existing recordkeeping obligations. One commenter requested that the Commission limit changes to § 1.31 to the elimination of the native file format, WORM, and third-party technical consultant requirements, and withdraw the remainder of the proposal.3 As outlined below, several commenters also suggested modifications to the proposed rule text, including the requirement for records entities to establish, maintain, and implement written policies and procedures reasonably designed to ensure that the records entity complies with its recordkeeping obligations. For reasons provided below, the Commission has accepted certain of these recommendations in the amendments being adopted today, but has declined to accept certain other recommendations, including recommendations beyond the scope of the Proposal.

    2 Comment letters were submitted by the following entities: The Securities Industry and Financial Markets Association (“SIFMA”); CME Group Inc. (“CME”); NASDAQ Futures, Inc. (“NASDAQ”); the National Futures Association (“NFA”); SunTrust Bank; the Futures Industry Association (“FIA”); the Edison Electric Institute and National Rural Electric Cooperative (“EEI & NREC”); the Investment Company Institute (“ICI”); Managed Funds Association, Investment Adviser Association, Alternative Investment Management Association, and SIFMA Asset Management Group (“Associations”; the Minneapolis Grain Exchange (“MGEX”); The Depository Trust & Clearing Corporation (“DTCC”); ICE Futures U.S., Inc. (“ICE”); the Commercial Energy Working Group (“Working Group”); the International Swaps and Derivatives Association, Inc. (“ISDA”); the Federal Home Loan Banks (“FHLBanks”); and the International Energy Credit Association (“IECA”). All comment letters are available on the Commission's Web site at https://comments.cftc.gov/PublicComments/CommentList.aspx?id=1774.

    3See CME comment letter.

    III. Final Rule

    The Commission has considered the comments it received in response to the Proposal and is adopting the rule amendments as proposed, with the following exceptions: (1) Revising the definition of “regulatory records” in § 1.31(a); (2) deleting proposed § 1.31(b) regarding the requirement for a records entity to establish, maintain, and implement written policies and procedures designed to ensure compliance with all obligations under § 1.31; (3) amending § 1.31(c) to limit the retention period for pre- trade communications required by § 23.202(a)(1) and § 23.202(b)(1)-(3) to five years from the date the communication was created; (4) deleting from § 1.31(d)(2)(i) the requirement that a records entity retain systems that maintain the “chain of custody elements” of any electronic regulatory record; and (5) re-lettering § 1.31(c)-(f) to account for the deletion of proposed § 1.31(b). Specific provisions of the final rules are addressed below.

    A. Regulation 1.31(a): Definitions

    The Commission proposed to define in § 1.31(a) the terms “electronic regulatory records,” “records entity,” and “regulatory records” as used elsewhere in the section.

    The Commission received several comments regarding the proposed definition of “records entity” to be any person required by the Act or Commission regulations to keep regulatory records. A few commenters requested that the Commission exclude from the definition of “records entity” those persons that are neither registrants nor registered entities.4 One commenter 5 further suggested that compliance with the proposed changes would impose greater costs on records entities that are neither registrants nor registered entities.6 In light of these comments, the Commission notes that the final rule as adopted by this release does not impose any new recordkeeping requirements on any records entity, including those that are neither registrants nor registered entities, such as commercial end-users. Rather, the final rule merely modernizes and makes technology neutral the form and manner in which regulatory records must be kept. Further, the final rule is clear that it does not override other methods of maintaining records that may be specified elsewhere in the Act or other Commission regulations.7 Thus, commercial end-users that are records entities, for example, may continue to maintain records in accordance with their current practices if such are permitted by the Act, Commission regulations, or existing relief or guidance.8 Further, as stated above, the final rule removes several obligations regarding the form and manner in which regulatory records must be kept that should lessen the compliance costs associated with the recordkeeping requirements set forth in § 1.31. Given the foregoing, the Commission has determined not to exclude any persons required to keep regulatory records from the definition of “records entity.”

    4E.g., ISDA, ICI, and Associations comment letters.

    5See ISDA comment letter.

    6E.g., § 1.35(a) (Unregistered members of a DCM or SEF required to retain records of commodity interests and related cash or forward transactions) and §§ 32.2, 32.3, 45.2, and 45.6 (Non-Swap Dealer/Major Swap Participants (“Non-SD/MSPs”) are subject to trade option requirements including recordkeeping).

    7See text of final rule, § 1.31(b), (c), and (d), each stating, “[u]nless specified elsewhere in the Act or Commission Regulations. . . .”

    8E.g., Revised recordkeeping requirements for trade option counterparties that are Non-SD/MSPs, Trade Options, 81 FR 14966, 14970 (Mar. 21, 2016); and Relief for Unregistered Members from retaining text messages and maintaining required records in a particular form and manner, Records of Commodity Interest and Related Cash or Forward Transactions, 80 FR 80247, 80250-51 (Dec. 24, 2015).

    Regarding the definition of “regulatory records,” the Commission specifically requested comment whether the term “metadata”—or data about data—should be defined. The Commission recognized in the Proposal that the term metadata may be generally understood by practitioners notwithstanding a lack of universal agreement on an exact definition. A majority of commenters on the issue agreed that metadata need not be defined at this time as that would be inconsistent with the Commission's stated goal to provide for less-prescriptive recordkeeping obligations.9 Further, one commenter asserted that including metadata within the definition of a “regulatory record” would greatly increase the amount and associated costs of data to be stored and potentially subject to production requests.10 Another commenter stated that records entities would be required to pursue, develop, and purchase additional technological solutions to ensure compliance if metadata were defined.11

    9E.g., FIA and ICE comment letters.

    10See CME comment letter.

    11See Associations comment letter.

    The Commission notes that it and other federal agencies, including the Securities and Exchange Commission (“SEC”), have been requesting metadata in conjunction with information requests to industry for more than five years through standardized data delivery standards.12 The Commission believes that the § 1.31(a) definition of “regulatory record,” i.e., all data produced and stored electronically describing how and when such books and records were created, formatted, or modified, is sufficient to support its statutory inspection and investigative functions. Thus, the Commission has determined that there is no need to define metadata at this time.

    12 The Commission publishes the CFTC Data Delivery Standards on its Web site at: http://www.cftc.gov/idc/groups/public/@lrenforcementactions/documents/file/enfdatadeliverystandards052716.pdf. The Commission notes that other federal agencies, such as the SEC (https://www.sec.gov/divisions/enforce/datadeliverystandards.pdf), the Department of Justice (https://www.justice.gov/atr/case-document/file/494686/download) and the Department of Treasury Office of Foreign Asset Control (https://www.treasury.gov/resource-center/sanctions/OFAC-Enforcement/Documents/ofac_data_delivery.pdf) have similar data delivery standards.

    The Commission further noted in the Proposal that the proposed definition of “regulatory records” would more clearly state the existing requirement for each records entity to maintain a regulatory record and any subsequent versions of such record. Multiple commenters questioned whether the revised language was, in fact, imposing a new requirement to maintain versions of a regulatory record before it becomes in fact a regulatory record (i.e., drafts of an agreement created during a negotiation but prior to execution).13 To clarify that the Commission did not intend to require versions of a regulatory record prior to its becoming a regulatory record, the Commission is modifying the definition of “regulatory records” to indicate that the term means all books and records required to be kept by the Act or Commission regulations, including any record of any correction or other amendment to such books and records, provided that, with respect to such books and records stored electronically, regulatory records shall also include: (i) Any data necessary to access, search, or display any such books and records; and (ii) all data produced and stored electronically describing how and when such books and records were created, formatted, or modified. The Commission believes the definition as revised makes clear that a records entity only has the obligation to maintain data about a regulatory record after it is created and not about the record before it becomes a regulatory record.

    13E.g., Associations, CME, and ICE comment letters.

    As noted in the Proposal this is the existing standard in § 1.31. Under existing § 1.31(b)(1)(ii)(A) electronic records are required to be preserved exclusively in a non-rewritable, non-erasable format. This provision was designed to ensure the “trustworthiness of documents that may be relied upon by the Commission in conducting investigations and entered into evidence in administrative and judicial proceedings.” 14 It therefore follows that each version of an electronic record and all subsequent versions would have to be maintained under the existing rule. This requirement provides for a comprehensive audit trail, which the Commission believes is vital to both the supervision and enforcement of the Act and Commission regulations.

    14See 58 FR at 27460.

    Finally, another commenter also asserted that retaining all versions of a regulatory record is redundant and creates additional opportunities for data theft or loss.15 The commenter did not provide any detail regarding how maintaining subsequent versions of a regulatory record, which is an existing requirement under § 1.31, raises new concerns about data theft or loss. Thus, the Commission is unable to address any such concern at this time.

    15See CME comment letter.

    B. Regulation 1.31(b): Regulatory Records Policies and Procedures

    The Commission proposed to amend § 1.31(b) to require each records entity to establish, maintain, and implement written policies and procedures reasonably designed to ensure that the records entity complies with its obligations under Regulation 1.31. As proposed, the written policies and procedures would provide for, without limitation, appropriate training of officers and personnel of the records entity regarding their responsibility for ensuring compliance with the obligations of the records entity under § 1.31, and regular monitoring of such compliance.

    Without an explanation of the differences, several commenters disagreed with the Commission that the proposed requirement for written policies and procedures is consistent with the existing § 1.31(b)(3) requirement for anyone using electronic storage media to develop and maintain written operational procedures and controls (i.e., an “audit system”) designed to provide accountability over both the initial entry of required records and the entry of each change made to any original or duplicate record.16 Again without providing any explanation of the differences between the existing “audit system” requirement and the proposed requirement for written policies and procedures or any specific cost estimates, commenters also argued that the application of the proposed written policies and procedures requirement would create new regulatory obligations for records entities which are neither registrants nor registered entities, some of whom are commercial end-users.17 As a result, commenters argued that this additional requirement could deter certain market participants from trading swaps and other derivatives products in order to avoid having to comply with burdensome recordkeeping requirements.18 A few commenters argued that the specific reference to training is not consistent with the Commission's emphasis on a less-prescriptive, principles-based recordkeeping requirement.19 Other commenters requested that the Commission provide a phase-in period for establishing, maintaining and implementing written policies and procedures.20

    16E.g., ISDA comment letter.

    17E.g., IECA comment letter.

    18See ISDA comment letter.

    19E.g., Associations comment letter.

    20See MGEX and Working Group comment letters.

    Having considered these comments, the Commission has determined not to adopt the written policies and procedures requirement for records entities set forth in proposed § 1.31(b). The final rule, as adopted, sets forth the form and manner in which regulatory records must be kept, the retention period for various types of regulatory records, and the standards for production of regulatory records to the Commission. Given these clearly defined obligations, the Commission agrees with commenters that the requirement for written policies and procedures is unnecessary. As the Commission noted in the Proposal, the obligation to satisfy the requirements regarding § 1.31 is one that a records entity ignores at its peril. It is ultimately the duty and responsibility of records entities to ensure accurate and reliable records. The Commission also notes that registrants are subject to a duty to diligently supervise all activities relating to its business as a Commission registrant, pursuant to § 166.3. The Commission does not consider the withdrawal of a requirement for written policies and procedures to create an explicit or implicit defense against recordkeeping violations or failure to supervise violations.

    C. Regulation 1.31(b): Duration of Retention

    The Commission proposed to amend § 1.31(c)(re-lettered as § 1.31(b) in the final rule) to re-state and clarify the existing retention period requirements for categories of regulatory records set forth in existing § 1.31(a), including the requirement that certain records associated with a swap be retained for the duration of the swap plus five years. The Commission also proposed to distinguish between electronic regulatory records and those records exclusively created and maintained on paper by requiring a records entity to keep electronic regulatory records readily accessible for the duration of the required record keeping period, and not just for the first two years. The Commission noted that this standard is consistent with the SEC's standard for certain intermediaries.21 For ease of understanding, the Commission also proposed to amend §§ 1.35(a) and 23.203(b)(1) and (2) to make technical changes regarding regulatory records related to oral communications and swaps-related information maintained by swaps dealers and major swap participants, respectively. The Commission received several comments regarding various aspects of proposed § 1.31(c).

    21 SEC Rule 17a-4(f).

    Two commenters 22 requested that the Commission reduce the retention standard for electronic pre-execution communications required by § 23.202 in relation to a swap to five years from the date of creation of the regulatory record rather than the current standard of the duration of the swap plus five years.23 The commenters stated that the longer retention period “places an unnecessary retention burden on firms, which exceeds most statutes of limitations or utility with respect to underlying transactions.” 24 Another commenter stated that increasing retention periods for the storage of sensitive information in electronic form could put records entities, and their third-party service providers, at greater risk in the event of a data breach.25

    22See SIFMA and ISDA comment letters.

    23See § 23.202(a)(1).

    24See SIFMA comment letter.

    25See Associations comment letter.

    The Commission recognizes the increased burden and risk of a longer retention period as pointed out by commenters, and, having considered such increased burden and risk in light of the nature of the affected regulatory records, has determined to require retention of electronic communications specified in § 23.202(a)(1) and § 23.202(b)(1)-(3) only for a period of five years from the date of creation of the required record. The Commission notes that these are records of pre-execution communications and, as such, are likely to be useful for regulatory oversight purposes for a shorter length of time than records regarding execution of transactions or records of events that effect transactions following execution.

    For the avoidance of doubt, the Commission is not changing the retention period for execution trade information under § 23.202(a)(2), post-execution trade information under § 23.202(a)(3), the ledgers required under § 23.202(a)(4), or the daily trading records for related cash and forward transactions in § 23.202(b)(4)-(7). However, as previously stated, the Commission will continue to monitor changes in information technology and consider whether the recordkeeping regulation should be adjusted to reflect technological developments.

    Certain commenters requested clarification whether the requirements as adopted apply to existing records.26 The Commission confirms that the requirements adopted by this release do apply to existing records. However, the Commission notes that existing recordkeeping methods remain valid for compliance with the new rule, and that for many records entities, applying the new regime will reduce regulatory burdens. For example, many records entities will be permitted to maintain existing electronic records in a manner other than in their native file format and will no longer be required to retain a third-party technical consultant with authority to access a records entity's existing electronic records.27

    26See FIA and Working Group comment letters.

    27 The amendments adopted herein however would not excuse non-compliance with existing § 1.31 prior to the effective date of such amendments.

    D. Regulation 1.31(c): Form and Manner of Retention

    The Commission proposed to adopt § 1.31(d) (re-lettered as § 1.31(c) in final rule) to describe recordkeeping requirements regarding the form and manner in which regulatory records are retained by records entities. Consistent with the Commission's emphasis on a less-prescriptive, principles-based approach, proposed § 1.31(d)(1) would rephrase the existing requirements in the form of a general standard for each records entity to retain all regulatory records in a form and manner necessary to ensure the records' and recordkeeping systems' authenticity and reliability. The Commission proposed to adopt § 1.31(d)(2) to set forth additional controls for records entities retaining electronic regulatory records. The Commission emphasized in the Proposal that the proposed regulatory text does not create new requirements, but rather updates the existing requirements so that they are set out in a way that appropriately reflects technological advancements and changes to recordkeeping methods since the prior amendments of § 1.31 in 1999.

    Various commenters proposed technical amendments to proposed § 1.31(d)(2). Multiple commenters 28 requested that the Commission delete the “chain of custody” provision in proposed § 1.31(d)(2)(i) because it is a legal evidentiary standard which does not translate clearly to the technological requirements for recordkeeping. Another commenter similarly noted that the “chain of custody” requirement is redundant and unnecessarily prescriptive given that records entities are required under proposed Regulation 1.31(d)(1) to keep regulatory records in a form and manner that ensures the authenticity and reliability of such records.29 Moreover, one of the commenters noted that the proposed definition of “regulatory records” in proposed § 1.31(a) already includes a chain of custody requirement based on the following language: “data that describes how, when, and, if relevant, by whom such electronically stored information was collected, created, accessed, modified, or formatted.” 30 The Commission has considered the comment that the term “chain of custody” may cause confusion given that it currently exists as a legal evidentiary standard and, given that the Commission is also persuaded that the concept is adequately covered under the definition of “regulatory records” it has determined to delete the “chain of custody elements” from the electronic regulatory records systems requirement in amended § 1.31(c)(2)(i). The Commission notes, however, that the deletion of the term “chain of custody” does not change the practical requirement that records entities maintain a comprehensive audit trail for all electronic regulatory records.

    28See SIFMA, ISDA, and Associations comment letters.

    29See Working Group comment letter.

    30See SIFMA comment letter.

    One commenter also requested that the Commission amend proposed § 1.31(d)(2)(ii) to incorporate existing business continuity planning regulations in lieu of the proposed language: “in the event of an emergency or other disruption of the records entity's electronic record retention systems[.]” 31 The Commission is not making this requested change because records entities are not prohibited by the rule from incorporating their obligations to maintain availability of regulatory records into their existing business continuity planning. The Commission does not believe that the general standard in new § 1.31(c)(2)(ii) creates an obligation that would conflict with a records entity's existing business continuity procedures.

    31Id.

    The same commenter also requested that the Commission amend the proposed records inventory requirement in new § 1.31(c)(2)(iii) to not require system descriptions and information necessary for accessing or producing electronic regulatory records because introducing concepts related to access and production of records in this section is potentially confusing.32 For clarity, the Commission notes that data necessary to access and produce electronic regulatory records is itself a regulatory record under the definition thereof in § 1.31(a). Thus, the requirement in new § 1.31(c)(2)(iii) is simply a requirement that a records entity keep an up-to-date inventory of the systems where such data is maintained.

    32Id.

    Another commenter requested that the Commission delete from proposed § 1.31(d)(2)(i) the language “and to monitor compliance with the Act and Commission regulations in this Chapter” because such an “obligation to comply would not normally be embodied in a recordkeeping system.” 33 The Commission understands this comment to mean that the commenter reads proposed § 1.31(d)(2)(1) (re-lettered as § 1.31(c)(2)(1) in the final rule) as a stand-alone obligation to “monitor compliance with the Act. . . .” To clarify, the Commission notes that the requirement is to establish systems that maintain the security, signature, and data regarding electronic regulatory records to ensure that the records entity can monitor compliance with the Act. Thus the requirement is not a stand-alone obligation to “monitor compliance with the Act and Commission regulations. . . .”

    33See Associations comment letter.

    Another commenter objected to the proposed amendments that would impose the requirements of proposed § 1.31(d) (re-lettered as § 1.31(c) in the final rule) on commercial end-users that happen to be records entities, including the requirements that “each records entity maintaining electronic regulatory records shall establish appropriate systems and controls that ensure the authenticity and reliability of electronic regulatory records[.]” 34 The commenter stated that commercial end-users should not be subject to the obligation to establish “systems and controls . . . that ensure the authenticity of the information . . . and . . . monitor compliance with the Act and Commission regulations in this chapter[]” because the expense and burden of that obligation goes beyond the recordkeeping methods allowed in other Commission regulations allowing commercial end-users to retain and maintain their records in the ordinary or normal course of business.35 Moreover, the commenter stated that the creation of an “up-to-date inventory” appears to impose an entirely new regulatory recordkeeping expense that will require a commercial end-user to produce an inventory of its electronic records, and keep that inventory up to date, with respect to the “electronic records” that a commercial end-user is allowed in other Commission regulations to retain and maintain in the ordinary or normal course of business.36

    34See IECA comment letter.

    35See e.g., § 20.6(c) regarding large trader reporting for physical commodity swaps.

    36See e.g., §§ 32.2, 32.3, 45.2, and 45.6 regarding trade option requirements for Non-SD/MSPs.

    The Commission declines to revise the rule in response to this comment because, as noted previously, § 1.31(d) (re-lettered as § 1.31(c) in the final rule) does not impose any new recordkeeping requirements on any records entity, including those that are commercial end-users. Rather, the final rule merely modernizes and makes technology neutral the form and manner in which regulatory records must be kept. Further, the final rule is clear that it does not override other methods of maintaining records that may be specified elsewhere in the Act or other Commission regulations. Thus, commercial end-users that are records entities, for example, may continue to maintain records in accordance with their current practices if such are permitted by the Act, Commission regulations, or existing relief or guidance. Finally, as described above, the final rule removes several obligations regarding the form and manner in which regulatory records must be kept that should lessen the compliance costs associated with the recordkeeping requirements set forth in § 1.31 generally.

    In response to a specific question in the Proposal as to whether the Commission should routinely publish guidelines regarding the technical standards for electronic regulatory records, one commenter argued that publication of such standards likely would result in increased cost and devotion of technical resources to ensure compliance with any changing standards.37 The commenter specifically requested that the Commission avoid publishing guidelines for technical standards of regulatory records and simply monitor records entities to ensure that regulatory records are retained in a “form and manner necessary to ensure the records' and recordkeeping systems' authenticity and reliability.” Given that only one commenter responded to the request for comment, and responded negatively, the Commission is persuaded that publishing guidelines regarding the technical standards for electronic regulatory records would not be helpful at this time.

    37See MGEX comment letter.

    Regarding the form and manner of retention of electronic regulatory records, one commenter requested confirmation that the specific means of electronic storage that the commenter employs is an acceptable means for storing electronic regulatory records.38 As noted throughout this adopting release the Commission believes that the amendments to § 1.31 are intended to be technology neutral and therefore the Commission is not requiring or endorsing any type of record retention system or technology.

    38See DTCC comment letter.

    With respect to the effective date of these regulations, a few commenters requested a three- or six-month phase-in period for compliance.39 Although the Commission has noted throughout this adopting release that it believes that the amendments adopted today are not creating any new compliance obligations for any records entities, it is nevertheless persuaded that a three-month phase-in for compliance is a reasonable request. Thus, the Commission has determined that the effective date for the proposed amendments will be 90 days from the date of publication.

    39See MGEX and Working Group comment letters.

    E. Regulation 1.31(d): Inspection and Production of Regulatory Records

    The Commission proposed to adopt new § 1.31(e) (re-lettered as § 1.31(d) in the final rule) to re-state and clarify the right of inspection of the Commission and the United States Department of Justice in existing § 1.31(a)(1). One commenter requested that the Commission engage in a dialogue with industry to address challenges presented by the production requirements of § 1.31, including the scope of what is subject to a production request and who may make such a request.40 In particular, the commenter stated that § 1.31 should recognize the long standing protections of attorney-client privilege and expressly exclude such information from the rule's production requirement.

    40See CME comment letter.

    The Commission believes that the proposed amendment to § 1.31(e) does not alter the existing right of inspection regarding regulatory records and notes that attorney-client protections are addressed elsewhere in federal and state law.41

    41See Wigmore on Evidence: Evidence in Trials at Common Law—Wigmore, Rule 502. Attorney- Client Privilege and Work Product (online version updated 4/2017), for a comprehensive list of attorney-client protections under federal and state law. Further, in 1999, the Commission addressed the waiver of privilege issue as follows: “As is currently the case with all Commission required records, recordkeepers may not deny authorized Commission representatives access to any individual storage medium that includes Commission-required records or delay production while the individual storage medium is reviewed for the presence of privileged material. The final rule merely eliminates the regulatory inference that the commingling of Commission-required records with non-Commission-required records necessarily amounts to a waiver of any privilege otherwise covering the latter category of records.” See Recordkeeping, 64 FR 28735, 28740, note 40 (May 27, 1999).

    F. Comments Beyond the Scope of the Proposed Rulemaking

    Although the Commission stated that the Proposal was limited to amendments to § 1.31 and related technical amendments, the Commission received several comments regarding matters outside the scope of the Proposal, as discussed below.

    The petitioners for rulemaking restated their request from their original petition that the Commission adopt amendments to Part 4 of the Commission's regulations regarding certain recordkeeping requirements applicable to commodity pool operators and commodity trading advisors.42 The Proposal did not address any such amendments and thus such amendments are outside of the scope of this rulemaking.

    42See Associations and ICI comment letters.

    Another commenter 43 acknowledged that the Regulation AT rulemaking 44 addresses source code issues outside the scope of the Proposal, but nonetheless requested the Commission provide additional guidance regarding any requests for source code information by the Commission subject to § 1.31. In response to this request, the Commission reiterates that production of source code is outside the scope of this rulemaking.

    43See FIA comment letter.

    44See Regulation Automated Trading, 81 FR 85334 (Nov. 25, 2016).

    Finally, another commenter 45 recommended that the SEC amend SEC Rule 17a-4 regarding the recordkeeping obligations of broker-dealers, some of whom are also registered as futures commission merchants with the Commission. The Commission does not have jurisdiction with respect to SEC regulations and thus such recommendation is outside of the scope of this rulemaking.

    45See SIFMA comment letter.

    IV. Related Matters A. Regulatory Flexibility Act

    The Regulatory Flexibility Act (“RFA”) 46 requires Federal agencies, in promulgating regulations, to consider whether the rules they propose will have a significant economic impact on a substantial number of small entities and, if so, to provide a regulatory flexibility analysis regarding the economic impact on those entities. In the Proposal, the Commission certified that the Proposal would not have a significant economic impact on a substantial number of small entities. The Commission received no comments with respect to the RFA.

    46 5 U.S.C. 601 et seq.

    As discussed above, because the final rule relates to most recordkeeping obligations under the Act and the Commission's regulations, it may affect the full spectrum of Commission registrants, all persons required to register but not registered with the Commission, and certain persons that are neither registered nor required to register with the Commission. The Commission has previously determined that certain registrants are not small entities for purposes of the RFA and, therefore, the requirements of the RFA do not apply to those entities.47 For other registrants, however, the Commission has found it appropriate to consider whether such registrants should be deemed small entities for purposes of the RFA on a case-by-case basis, in the context of the particular Commission regulation at issue.48 As certain persons affected by the final rule, including Commission registrants, may be small entities for purposes of the RFA, the Commission considered whether this rulemaking would have a significant economic impact on any such persons.

    47See, e.g., Policy Statement and Establishment of Definitions of “Small Entities” for Purposes of the Regulatory Flexibility Act, 47 FR 18618 (Apr. 30, 1982) (futures commission merchants and commodity pool operators); Leverage Transactions, 54 FR 41068 (Oct. 5, 1989) (leverage transaction merchants); Regulation of Off-Exchange Retail Foreign Exchange Transactions and Intermediaries, 75 FR 55410, 55416 (Sept. 10, 2010) (retail foreign exchange dealers); and Registration of Swap Dealers and Major Swap Participants, 77 FR 2613, 2620 (Jan. 19, 2012) (swap dealers and major swap participants).

    48See 47 FR at 18620 (commodity trading advisors and floor brokers); Registration of Floor Traders; Mandatory Ethics Training for Registrants; Suspension of Registrants Charged With Felonies, 58 FR 19575, 19588 (Apr. 15, 1993) (floor traders); and Introducing Brokers and Associated Persons of Introducing Brokers, Commodity Trading Advisors and Commodity Pool Operators; Registration and Other Regulatory Requirements, 48 FR 35248, 35276 (Aug. 3, 1983) (introducing brokers).

    As discussed in the Proposal, the final rule generally updates and simplifies existing Commission regulation 1.31 with new provisions that maintain the ability of the Commission to examine and inspect regulatory records. It accomplishes this by deleting outdated terms and revising provisions to reflect advances in information technology, allowing records entities to benefit from evolving technological developments while maintaining necessary safeguards to ensure the reliability of the recordkeeping process. It also reduces the retention period for certain regulatory records related to swaps and related cash and forward transactions, as discussed above.

    The Commission believed that the Proposal would impose only limited additional costs on small entities related to the requirement that they establish written recordkeeping policies and procedures. However, for the reasons discussed above, the Commission has been persuaded to not require such written recordkeeping policies and procedures.

    As a result, the final rule is not expected to impose any new burdens on market participants. The Commission does not, therefore, expect small entities to incur any additional costs as a result of the final rule. In addition, the Commission does not expect the economic value of the benefit to small entities of the final rule to be significant. Consequently, the Commission finds that no significant economic impact on small entities will result from the final rule.

    Accordingly, for the reasons stated above, the Commission believes that the final rule will not have a significant economic impact on a substantial number of small entities. Therefore, the Acting Chairman, on behalf of the Commission, hereby certifies, pursuant to 5 U.S.C. 605(b), that the final rule being published today by this Federal Register release will not have a significant economic impact on a substantial number of small entities.

    B. Paperwork Reduction Act 1. Background

    The Paperwork Reduction Act of 1995 (“PRA”) 49 imposes certain requirements on Federal agencies (including the Commission) in connection with their conducting or sponsoring any collection of information as defined by the PRA. The final rule does not impose any new recordkeeping or information collection requirements, or other collections of information that require approval of the Office of Management and Budget (“OMB”) under the PRA.

    49 44 U.S.C. 3501 et seq.

    As discussed above, the Proposal would have replaced the existing audit system requirements in Commission regulation 1.31 with a requirement that records entities establish written recordkeeping policies and procedures. Such changes would have resulted in revisions to “Adaptation of Regulations to Incorporate Swaps-Records of Transactions, OMB control number 3038-0090”. Because the Commission has been persuaded not to require such written recordkeeping policies and procedures, the Commission will not be modifying this OMB control number to reflect the addition of the proposed recordkeeping policies and procedures requirement. As discussed in the Proposal, however, the Commission will submit to OMB revisions to OMB control number 3038-0090 to reflect the final rule's removal of the audit system requirements in current Commission regulation 1.31.

    2. Information Collection Comments

    In the Proposal, the Commission invited the public and other Federal agencies to comment on any aspect of the information collection requirements discussed therein, including that the only collection of information within the meaning of the PRA added or modified by the Proposal would be in respect of the proposed, but not adopted, requirement that records entities establish recordkeeping policies and procedures. The Commission did not receive any such comments.

    C. Cost-Benefit Considerations

    Section 15(a) of the Act 50 requires the Commission to consider the costs and benefits of its actions before issuing a regulation under the Act. Section 15(a) further specifies that the costs and benefits shall be evaluated in light of the following five broad areas of market and public concern: (i) Protection of market participants and the public; (ii) efficiency, competitiveness and financial integrity of futures markets; (iii) price discovery; (iv) sound risk management practices; and (v) other public interest considerations. The Commission considers the costs and benefits resulting from its discretionary determinations with respect to the Section 15(a) considerations.

    50 7 U.S.C. 19(a).

    1. Costs

    As discussed above in relation to the RFA, the Proposal generally updates and simplifies existing Commission regulation 1.31 by deleting outdated terms and revising provisions to reflect advances in information technology while safeguarding the reliability of the recordkeeping process. The Commission believes that the final rule does not impose any additional costs on records entities.

    2. Benefits

    The Commission is committed to reviewing its regulations to ensure they keep pace with technological developments and industry trends, and reduce regulatory burden. The Commission believes that the final rule will allow records entities to benefit from evolving technology while maintaining necessary safeguards to ensure the reliability of the recordkeeping process. By deleting outdated terms and revising provisions to reflect advances in information technology, the final rule will allow records entities to utilize a wider range of currently available technology than previously allowed and remove or modify requirements that the Commission believes are now obsolete (e.g., removing the requirements to have an audit system, to maintain electronic records in limited specified formats, and to retain a Technical Consultant, and reducing the retention period for certain regulatory records of swaps and related cash or forward transactions), allowing records entities to reduce their costs. In addition, the Commission believes that the flexibility provided by the final rule will, without further Commission rulemaking, allow records entities to adopt new technologies as such technologies evolve, allowing such persons to reduce future costs.

    Moreover, the Commission expects that the added flexibility provided by the final rule will encourage records entities to utilize electronic storage rather than maintain paper regulatory records. The Commission expects that this conversion will benefit the Commission, the Department of Justice, and the commodity interest industry, generally, by making the universe of regulatory records more accessible and searchable.

    3. Section 15(a) Factors

    Section 15(a) of the CEA requires the Commission to consider the costs and benefits of its actions before promulgating a regulation under the CEA or issuing certain orders. CEA Section 15(a) further specifies that the costs and benefits shall be evaluated in light of five broad areas of market and public concern: (i) Protection of market participants and the public; (ii) efficiency, competitiveness, and financial integrity of futures markets; (iii) price discovery; (iv) sound risk management practices; and (v) other public interest considerations.

    i. Protection of Market Participants and the Public

    Because the final rule does not alter any existing requirements regarding the type of regulatory records to be produced and maintained, but, rather, modernizes and makes technology neutral the form and manner in which certain regulatory records must be kept the Commission believes that the final rule will continue to protect the public by maintaining necessary safeguards to ensure the reliability of the recordkeeping process while allowing records entities to benefit from evolving technology.

    ii. Efficiency, Competitiveness, and Financial Integrity of Markets

    As discussed above, the final rule, by providing additional flexibility to records entities to electronically store their regulatory records, may increase resource allocation efficiency by improving the way in which such records are maintained. Apart from that, the Commission anticipates minimal change to the efficiency, competitiveness, and financial integrity of the markets, because this rulemaking only affects recordkeeping and not how these markets otherwise operate.

    iii. Price Discovery

    The Commission believes that the final rule may increase confidence and participation in the markets by lowering costs for records entities and by encouraging the electronic storage of regulatory records, allowing such records to be more easily accessed and searched. Nevertheless, the Commission does not anticipate a significant increase in liquidity or a significant improvement in price discovery as a result of the final rule.

    iv. Sound Risk Management Practices

    The Commission does not believe that the final rule will have any significant impact on sound financial risk management practices because this rulemaking only affects recordkeeping and not how market participants conduct financial risk management. The Commission believes that the final rule may result in minor improvements to operational risk management because, as noted above, it will provide additional flexibility to records entities to electronically store their regulatory records.

    v. Other Public Interest Considerations

    The Commission has not identified any additional public interest considerations.

    4. Comments on Cost-Benefit Considerations

    The Commission invited public comment on its cost-benefit considerations in the Proposal, including the Section 15(a) factors described above. Commenters were invited to submit with their comment letters any data or other information that they had that quantified or qualified the costs and benefits of the Proposal. The Commission received a number of comments on the Proposal as described above; however, none of the persons who commented on the Proposal submitted any data or other information that quantified or qualified the costs and benefits of the Proposal. Nevertheless, in response to certain comments on the Proposal, and to reduce the costs of the final rule on records entities, the Commission has been persuaded not to require in the final rule the written recordkeeping policies and procedures that had been proposed in § 1.31(b) because the alternative suggested by commenters achieves all the recordkeeping objectives of the Commission.

    List of Subjects 17 CFR Part 1

    Commodity futures, Reporting and recordkeeping requirements.

    17 CFR Part 23

    Authority delegations (Government agencies), Commodity futures, Reporting and recordkeeping requirements.

    For the reasons set forth in the preamble, the Commodity Futures Trading Commission amends 17 CFR chapter I as follows:

    PART 1—GENERAL REGULATIONS UNDER THE COMMODITY EXCHANGE ACT 1. The authority citation for part 1 continues to read as follows: Authority:

    7 U.S.C. 1a, 2, 5, 6, 6a, 6b, 6c, 6d, 6e, 6f, 6g, 6h, 6i, 6k, 6l, 6m, 6n, 6o, 6p, 6r, 6s, 7, 7a-1, 7a-2, 7b, 7b-3, 8, 9, 10a, 12, 12a, 12c, 13a, 13a-1, 16, 16a, 19, 21, 23, and 24 (2012).

    2. Revise § 1.31 to read as follows:
    § 1.31 Regulatory records; retention and production.

    (a) Definitions. For purposes of this section:

    Electronic regulatory records means all regulatory records other than regulatory records exclusively created and maintained by a records entity on paper.

    Records entity means any person required by the Act or Commission regulations in this chapter to keep regulatory records.

    Regulatory records means all books and records required to be kept by the Act or Commission regulations in this chapter, including any record of any correction or other amendment to such books and records, provided that, with respect to such books and records stored electronically, regulatory records shall also include:

    (i) Any data necessary to access, search, or display any such books and records; and

    (ii) All data produced and stored electronically describing how and when such books and records were created, formatted, or modified.

    (b) Duration of retention. Unless specified elsewhere in the Act or Commission regulations in this chapter:

    (1) A records entity shall keep regulatory records of any swap or related cash or forward transaction (as defined in § 23.200(i) of this chapter), other than regulatory records required by § 23.202(a)(1) and (b)(1)-(3) of this chapter, from the date the regulatory record was created until the termination, maturity, expiration, transfer, assignment, or novation date of the transaction and for a period of not less than five years after such date.

    (2) A records entity that is required to retain oral communications, shall keep regulatory records of oral communications for a period of not less than one year from the date of such communication.

    (3) A records entity shall keep each regulatory record other than the records described in paragraphs (b)(1) or (b)(2) of this section for a period of not less than five years from the date on which the record was created.

    (4) A records entity shall keep regulatory records exclusively created and maintained on paper readily accessible for no less than two years. A records entity shall keep electronic regulatory records readily accessible for the duration of the required record keeping period.

    (c) Form and manner of retention. Unless specified elsewhere in the Act or Commission regulations in this chapter, all regulatory records must be created and retained by a records entity in accordance with the following requirements:

    (1) Generally. Each records entity shall retain regulatory records in a form and manner that ensures the authenticity and reliability of such regulatory records in accordance with the Act and Commission regulations in this chapter.

    (2) Electronic regulatory records. Each records entity maintaining electronic regulatory records shall establish appropriate systems and controls that ensure the authenticity and reliability of electronic regulatory records, including, without limitation:

    (i) Systems that maintain the security, signature, and data as necessary to ensure the authenticity of the information contained in electronic regulatory records and to monitor compliance with the Act and Commission regulations in this chapter;

    (ii) Systems that ensure the records entity is able to produce electronic regulatory records in accordance with this section, and ensure the availability of such regulatory records in the event of an emergency or other disruption of the records entity's electronic record retention systems; and

    (iii) The creation and maintenance of an up-to-date inventory that identifies and describes each system that maintains information necessary for accessing or producing electronic regulatory records.

    (d) Inspection and production of regulatory records. Unless specified elsewhere in the Act or Commission regulations in this chapter, a records entity, at its own expense, must produce or make accessible for inspection all regulatory records in accordance with the following requirements:

    (1) Inspection. All regulatory records shall be open to inspection by any representative of the Commission or the United States Department of Justice.

    (2) Production of paper regulatory records. A records entity must produce regulatory records exclusively created and maintained on paper promptly upon request of a Commission representative.

    (3) Production of electronic regulatory records. (i) A request from a Commission representative for electronic regulatory records will specify a reasonable form and medium in which a records entity must produce such regulatory records.

    (ii) A records entity must produce such regulatory records in the form and medium requested promptly, upon request, unless otherwise directed by the Commission representative.

    (4) Production of original regulatory records. A records entity may provide an original regulatory record for reproduction, which a Commission representative may temporarily remove from such entity's premises for this purpose. Upon request of the records entity, the Commission representative shall issue a receipt for any original regulatory record received. At the request of a Commission representative, a records entity shall, upon the return thereof, issue a receipt for the original regulatory record returned by such representative.

    3. In § 1.35, revise paragraph (a)(5) to read as follows:
    § 1.35 Records of commodity interest and related cash or forward transactions.

    (a) * * *

    (5) Form and manner. All records required to be kept pursuant to paragraphs (a)(1), (a)(2), (a)(3), and (a)(4) of this section, other than pre-trade communications, shall be kept in a form and manner that allows for the identification of a particular transaction.

    PART 23—SWAP DEALERS AND MAJOR SWAP PARTICIPANTS 4. The authority citation for part 23 continues to read as follows: Authority:

    7 U.S.C. 1a, 2, 6, 6a, 6b, 6b-1, 6c, 6p, 6r, 6s, 6t, 9, 9a, 12, 12a, 13b, 13c, 16a, 18, 19, 21.

    Section 23.160 also issued under 7 U.S.C. 2(i); Sec. 721(b), Pub. L. 111-203, 124 Stat. 1641 (2010).

    5. In § 23.203, amend paragraph (b) as follows: a. Revise paragraph (b)(1); and b. Remove and reserve paragraph (b)(2).

    The revisions to read as follows:

    § 23.203 Records; retention and inspection.

    (b) Record retention. (1) The records required to be maintained by this chapter shall be maintained in accordance with the provisions of § 1.31 of this chapter, except as provided in paragraph (b)(3) of this section. All such records shall be open to inspection by any representative of the Commission, the United States Department of Justice, or any applicable prudential regulator. Records relating to swaps defined in section 1a(47)(A)(v) shall be open to inspection by any representative of the Commission, the United States Department of Justice, the Securities and Exchange Commission, or any applicable prudential regulator.

    (2) [Reserved]

    Issued in Washington, DC, on May 23, 2017, by the Commission. Christopher J. Kirkpatrick, Secretary of the Commission. Note:

    The following appendix will not appear in the Code of Federal Regulations.

    Appendix to Recordkeeping—Commission Voting Summary

    On this matter, Acting Chairman Giancarlo and Commissioner Bowen voted in the affirmative. No Commissioner voted in the negative.

    [FR Doc. 2017-11014 Filed 5-26-17; 8:45 am] BILLING CODE 6351-01-P
    COMMODITY FUTURES TRADING COMMISSION 17 CFR Part 165 RIN 3038-AE50 Whistleblower Awards Process AGENCY:

    Commodity Futures Trading Commission.

    ACTION:

    Final rule.

    SUMMARY:

    The Commodity Futures Trading Commission (“Commission”) is amending its regulations and forms to enhance the process for reviewing whistleblower claims and to make related changes to clarify staff authority to administer the whistleblower program. The Commission also is making appropriate rule amendments to implement its reinterpretation of the Commission's anti-retaliation authority.

    DATES:

    This final rule is effective July 31, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Anthony Hays, Counsel, (202) 418-5584, [email protected], Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581.

    SUPPLEMENTARY INFORMATION:

    The Commission is amending its rules in §§ 165.1 through 165.19 and appendix A, and adopting new rule § 165.20 and appendix B as well as amending Forms TCR (“Tip, Complaint or Referral”) and WB-APP (“Application for Award for Original Information Provided Pursuant to Section 23 of the Commodity Exchange Act”).

    I. Background

    In 2011, the Commission adopted its part 165 regulations, which implement Section 23 of the Commodity Exchange Act (“CEA”), 7 U.S.C. 26, by establishing a regulatory framework for the whistleblower program.1 Part 165 provides for the payment of awards, subject to certain limitations and conditions, to whistleblowers who voluntarily provide the Commission with original information about a violation of the CEA that leads to the successful enforcement of an action brought by the Commission that results in monetary sanctions exceeding $1,000,000 (“Covered Action”), or the successful enforcement of a Related Action, as that term is defined in the rules.

    1See Whistleblower Incentives and Protection, 76 FR 53172 (Aug. 25, 2011).

    The award amount must be between 10 and 30 percent of the amount of monetary sanctions collected in a Covered Action or a Related Action and is paid from the CFTC Customer Protection Fund. The Commission has discretion regarding the amount of an award based on the significance of the information, the degree of assistance provided by the whistleblower, and other criteria.

    Since the whistleblower program was established in 2011, the need for certain improvements has become apparent. In order to address that need the Commission proposed amendments to the part 165 rules (“Proposal”).2 As explained further below, these rules provide for targeted revisions to the claims review process and to the authority of staff to administer the whistleblower program. The Commission also proposed to amend the rules to implement its anti-retaliation authority under Section 23(h)(1) based on a reinterpretation of that authority. Finally, the Commission proposed to amend its rules to permit whistleblowers to receive awards based on both Covered Actions and the successful enforcement of Related Actions, as defined in the rules.

    2 Whistleblower Awards Process, 81 FR 59551 (Aug. 30, 2016).

    The Commission received seven comment letters in response to the Proposal. Most of the comment letters focused on specific aspects of the proposed rule amendments and made targeted recommendations and suggestions. Three of the comment letters were from private individuals, two were from law firms with whistleblower practices, and two were from whistleblower advocacy groups.3 Most of the comments received were generally supportive of the Commission's whistleblower program and proposed changes to the rules. One comment letter was critical of the current process for handling whistleblower award claims but did not provide specific comments on the proposed rules.4 One of the whistleblower advocacy groups incorporated by reference the comment letter previously submitted by the other group.5

    3See, respectively, the following: Letter dated September 12, 2016, from Joseph N. Perlman; Letter dated September 16, 2016, from Chris Barnard; Letter dated September 27, 2016, from Matthew Erpen; Letter dated September 29, 2016, from Robert D.M. Garson, Garson, Segal, Steinmetz, Fladgate LLP (GS2Law); Letter dated September 29, 2016, from Eric L. Young, Esq., and James J. McEldrew, Esq., McEldrew Young (MY); Letter dated September 28, 2016, from Jacklyn N. DeMar, Acting Director of Legal Education, Taxpayers Against Fraud (TAF); and Letter dated September 29, 2016, from Stephen M. Kohn, Executive Director, and David K. Colapinto, General Counsel, National Whistleblower Center (NWC).

    4See Joseph N. Perlman comment letter.

    5See NWC comment letter.

    II. Description of Final Rules

    The Commission is adopting the amendments to its part 165 whistleblower rules as set forth in the Proposed Rules with certain changes made in response to public comments. The amendments and the public comments relevant to each amendment are discussed below.6

    6 The public comments on the Proposed Rule are available at https://comments.cftc.gov/PublicComments/CommentList.aspx?id=1733.

    Eligibility Requirements for Consideration of an Award a. Proposed Rule

    The Commission proposed targeted changes to the rules relating to consideration of an award. The Commission proposed to revise Rule 165.5 to make clear that a claimant may receive an award in a Covered Action, in a Related Action, or both. Also in Rule 165.5, the Commission proposed to make clear that a claimant may be eligible for an award by providing the Commission original information without being the original source of the information, and the Commission provided the public with notice that the Commission has discretion to waive its procedural rules based upon a showing of extraordinary circumstances.

    In addition, the Commission proposed to revise the definition of “original source” in Rule 165.2(l) to extend the timeframe from 120 to 180 days that a whistleblower has to file a Form TCR pursuant to Rule 165.3 after previously providing the same information to Congress, any other federal or state authority, a registered entity, a registered futures association, a self-regulatory organization, or to any of the persons described in Rule 165.2(g)(4) and (5).

    b. Comments Received

    The Commission received several comments regarding the proposed changes to the requirements for consideration of an award.

    Proposed Rule 165.5(b) removed being the original source of information received by the Commission from the eligibility criteria for an award. The Commission received one comment which endorsed this approach.7

    7See TAF comment letter.

    The Commission received two comments regarding the Commission's proposal to amend Rule 165.5(c) to allow the Commission to waive procedural requirements in extraordinary circumstances. Both commenters supported the proposed change to this rule.8 One commenter noted that the proposed change to this rule is consistent with the overall policy goals of the whistleblower program and that whistleblowers have varying levels of sophistication and familiarity with the procedural requirements.9 Another commenter noted that rigid application of the procedural requirements would undermine the spirit of Congress when it created the whistleblower program and that the proposed change would further encourage whistleblowers to provide information even when they may not have followed all of the technical rules to be eligible for an award.10

    8See TAF and MY comment letters.

    9See TAF comment letter.

    10See MY comment letter.

    Proposed Rule 165.2(l) extended the deadline from 120 to 180 days that a whistleblower has to make a submission to the Commission and retain status as the original source of information after first submitting the information to Congress, any other federal or state authority, a registered entity, a registered futures association, a self-regulatory organization, or to any of the persons described in paragraphs (g)(4) and (5) of Rule 165.2 to be eligible for an award. The Commission received two comments supporting this proposed change.11 One commenter stated that many whistleblowers are often at or beyond the 120-day period before considering external reporting because they wait for the outcome of the internal investigation before reporting externally and internal investigations often take some time. This commenter also stated that while 180 days is a substantial improvement, an even longer time frame would help ensure that well-intentioned individuals receive full credit for their information.12

    11See TAF and MY comment letters.

    12See MY comment letter.

    The other commenter agreed that the period of eligibility should be lengthened to 180 days but urged the Commission to state that the 180-day period refers only to the whistleblower's “look back” eligibility to retain original source status and that whistleblowers will not lose that status or eligibility for an award if they perfect their submission to the Commission after 180 days elapse. This commenter also urged the Commission to revise Rule 165.2(l)(2) to include individuals who first provide information to foreign governments or self-regulatory authorities because of the global nature of the commodities markets and the increasing number of international whistleblowers participating in the Dodd-Frank whistleblower programs. This commenter went on to state that there is no persuasive policy reason for excluding such persons from original source status because some of the Commission's recent enforcement cases were brought with the cooperation of foreign authorities and the proposed rules allow for whistleblower awards based on Related Actions by certain foreign authorities. Hence, this commenter argued that if whistleblowers may receive awards based on Related Actions undertaken by foreign authorities, those whistleblowers should be entitled to original source eligibility in instances where they report to a foreign authority prior to reporting to the Commission.13

    13See TAF comment letter.

    c. Final Rule

    The Commission received no comments regarding the proposed revision in Rule 165.5(a)(3) that makes clear that a claimant may receive an award in a Covered Action, in a Related Action, or both and, accordingly, is adopting the amendment as proposed.

    With respect to the proposed revision to Rule 165.5(b), the Commission believes that removing the requirement that the whistleblower be the original source of information received by the Commission is consistent with Section 23(b)(1), and will prevent the potential situation where a claimant reports internally before providing information to the Commission and the employer self-reports the violation of the CEA, thereby foreclosing the claimant's eligibility for an award because the employer is the “original source” of the information. The Commission is adopting this amendment as proposed.

    The Commission has also decided to adopt as proposed Rule 165.5(c), which clarifies that the Commission may waive any procedural requirements upon a showing of extraordinary circumstances.

    After consideration of the comments on Rule 165.2(l), the Commission has decided to adopt the rule with one change, a conforming change and a minor correction. The Commission is adding foreign futures authorities 14 to the authorities and entities to which a claimant may provide information prior to filing a Form TCR and retain original source status. This change is consistent with the list of agencies and authorities in Section 23(h)(2)(C) with which the Commission can share information received from a whistleblower if necessary or appropriate to accomplish the purposes of the Commodity Exchange Act and protect customers. The Commission understands that individuals who are located outside the United States might decide to approach a local authority prior to providing information to the Commission. As a result, and in consideration of the global nature of the futures and swaps markets and the number of the Commission's recent enforcement actions that have been undertaken with the cooperation of foreign governments, the Commission believes it is appropriate to expand the list of entities in Rules 165.2(l)(1)(i) and 165.2(l)(2). In addition, the Commission is adding registered entity and registered futures association to, and removing futures association from the list of authorities in Rule 165.2(i)(2); and adding registered entity and registered futures association to Rule 165.2(l)(1)(i) in order to conform those rules to existing language in Rules 165.4(a)(2) and 165.11 and to Section 23(h)(2)(C)(i). The Commission is correcting a typographical error in Rule 165.2(l)(2) by removing “of any” and correcting an omission by inserting “local” in the list of authorities in the first sentence.

    14 Section 1a(26) of the CEA defines foreign futures authority as any foreign government, or any department, agency, governmental body, or regulatory organization empowered by a foreign government to administer or enforce a law, rule, or regulation as it relates to a futures or options matter, or any department or agency of a political subdivision of a foreign government empowered to administer or enforce a law, rule, or regulation as it relates to a futures or options matter.

    The Commission also clarifies that the 180-day timeframe in Rule 165.2(l)(2) relates only to the date on which the Commission will consider a whistleblower's original information to have been received. Filing a Form TCR more than 180 days after reporting information to another authority does not strip a whistleblower of original source status or render a whistleblower ineligible for an award. Also, the Commission is amending Rule 165.2(i)(3) to extend the time from 120 to 180 days in order to conform that rule to the extension of the timeframe in Rule 165.2(1)(2).

    Award Claims Review Under Rule 165.7 a. Proposed Rules

    The Commission proposed several changes to the award claims review process under Rule 165.7 to better define and specify each step in the process. Those steps were spelled out in proposed new paragraphs (f) through (l), along with new provisions regarding withdrawing award applications in proposed paragraph (d) and disposition of claims that do not relate to Notices of Covered Actions (“NCAs”) or final judgments in Related Actions in proposed new paragraph (e). The proposed amendments would establish a review process similar to that established under the SEC's whistleblower rules.15 Specifically, the Commission proposed to discontinue the Whistleblower Award Determination Panel and replace it with a review process handled by a Claims Review Staff designated by the Director of the Division of Enforcement in consultation with the Executive Director, with the Claims Review Staff being assisted by the Whistleblower Office staff within the Division of Enforcement. The proposed rules also would provide an additional means for the submission of the required Form WB-APP, Application for Award for Original Information Provided Pursuant to Section 23 of the Commodity Exchange Act, in Rule 165.7(b)(1); explain the deadline for filing Form WB-APP under different timing scenarios for final judgments in covered judicial or administrative actions and Related Actions in proposed Rule 165.7(b)(3); and make a conforming change by renumbering prior paragraph (e) in Rule 165.7 as paragraph (l).

    15See 17 CFR 240.21F-10(d)-(h) (2014).

    Proposed Rule 165.7(d) would permit a claimant to withdraw an award application at any point in the review process by submitting a written request to the Whistleblower Office.

    Proposed Rule 165.7(e) addressed the Commission's experience of receiving a number of Form WB-APPs that appear to be unrelated to NCAs or final judgments in Related Actions as well as Form WB-APPs that do not relate to a previously filed Form TCR. In order to reduce the administrative burden on the Commission, the Commission proposed that such facially ineligible claims primarily be handled by the Whistleblower Office. The Whistleblower Office would notify the claimant of the deficiencies in the Form WB-APP and provide an opportunity for the claimant to correct the deficiencies or withdraw the claim before the finalization of the denial of the claim. If the claimant does not correct the deficiencies or withdraw the claim, the Whistleblower Office would notify the Claims Review Staff of the proposed denial, which would be called a Proposed Final Disposition, and any member of the Claims Review Staff would have the opportunity to request review of the proposed denial. If no member of the Claims Review Staff requests review, the Proposed Final Disposition would become the final order of the Commission. If a member of the Claims Review Staff requests review, the Claims Review Staff would review the record for the denial and either remand to the Whistleblower Office for further action or issue a final order of the Commission, which consists of the proposed denial.

    In Rule 165.7(f), the Commission proposed that the Claims Review Staff would evaluate all timely award applications submitted on a Form WB-APP in response to the NCA or a final judgment in a Related Action. During the review process, the Whistleblower Office may require that claimants provide additional information, explanation, or assistance as set forth in Rule 165.5(b)(3). For award claims on Related Actions, as proposed in Rule 165.7(f), the Whistleblower Office may request additional information from the claimant to demonstrate that the claimant voluntarily provided the governmental agency, regulatory authority, or self-regulatory organization the same original information that led to the Commission's successful enforcement action and the successful enforcement of the Related Action. The Whistleblower Office may also seek assistance and confirmation from the other agency in making this determination.

    In Rule 165.7(g)(1), the Commission proposed that following the initial evaluation by the Claims Review Staff, the Claims Review Staff would issue a Preliminary Determination setting forth a preliminary assessment as to whether the claim should be granted or denied and, if granted, setting forth the proposed award percentage amount. The Whistleblower Office would send a copy of the Preliminary Determination to the claimant. The proposed amendments would allow a claimant the opportunity to contest the Preliminary Determination.

    In Rule 165.7(g)(2), the Commission proposed that the claimant could take any of the following steps in response to a Preliminary Determination:

    • Within thirty (30) calendar days of the date of the Preliminary Determination, the claimant may request that the Whistleblower Office make available for the claimant's review the materials that formed the basis of the Claim Review Staff's Preliminary Determination.

    • Within sixty (60) calendar days of the date of the Preliminary Determination, or if a request to review materials is made, then within sixty (60) days of the Whistleblower Office making those materials available for the claimant's review, a claimant may submit a written response setting forth the grounds for the claimant's objection to either the denial of an award or the proposed amount of an award. The claimant may also include documentation or other evidentiary support for the grounds advanced in any response, and request a meeting with the Whistleblower Office. However, such meetings would not be required. The Whistleblower Office may in its sole discretion decline the request.

    Proposed Rule 165.7(h) provides that if a claimant fails to submit a timely response under new Rule 165.7(g), then a Preliminary Determination denying an award becomes the Final Order of the Commission and constitutes a failure to exhaust the claimant's administrative remedies. Failure to exhaust administrative remedies would prohibit the claimant from pursuing judicial review.

    If the claimant fails to contest a Preliminary Determination recommending an award, the Preliminary Determination would be treated as a Proposed Final Determination, which would make it subject to Commission review under proposed Rule 165.7(j).

    Proposed Rule 165.7(i) describes the procedure in cases where a claimant submits a timely response under proposed Rule 165.7(g). In such cases, the Claims Review Staff would consider the issues raised in the claimant's response, along with any supporting documentation that the claimant provided, and prepare a Proposed Final Determination.

    In Rule 165.7(j), the Commission proposed that when there is a Proposed Final Determination, the Whistleblower Office would notify the Commission of the Proposed Final Determination. Within thirty (30) days of that notification, any Commissioner may request Commission review of the Proposed Final Determination. If no Commissioner makes such a request, the Proposed Final Determination would become the Commission's Final Order. If a Commissioner does request review, the Commission would review the record that the Claims Review Staff relied upon in reaching its determination. On the basis of its review of that record, the Commission would issue its Final Order, which the Office of the Secretariat would then serve on the claimant. In reaching their decisions, the Commission and Claims Review Staff would only consider information in the record.

    The Office of General Counsel would review both preliminary and proposed final determinations prior to issuance, and no such determination may be issued without the Office of General Counsel's determination of legal sufficiency.

    In Rule 165.15(a)(2), the Commission proposed that the Enforcement Director, in consultation with the Executive Director, would designate a minimum of three and a maximum of five staff from the Division of Enforcement or other Commission Offices or Divisions to serve on the Claims Review Staff, either on a case-by-case basis or for fixed periods. At least one person from outside the Division of Enforcement would be included on the Claims Review Staff at all times. The Claims Review Staff would be composed only of persons who have not had direct involvement with the underlying enforcement action. Due to the Office of General Counsel's role in the review process, the Commission believes it is appropriate to exclude staff from that Office from serving as Claims Review Staff.

    b. Comments Received

    The Commission received two generally supportive comments regarding the proposed additions and changes to the award review process.16 One commenter stated that having dedicated staff for award determinations would be beneficial and urged the Commission to publish NCAs for Related Actions that the Commission knows emanated from the information provided by the whistleblower.17 The other commenter reasoned that the proposed changes in the process allow whistleblowers to better understand the reasons for a particular award or denial and to make informed requests for reconsideration, and that the proposed changes offer greater transparency in the awards process and will likely obviate the need for some appeals.18

    16See GS2Law and TAF comment letters.

    17See GS2Law comment letter.

    18See TAF comment letter.

    c. Final Rule

    After consideration of the comments received, the Commission has decided to adopt Rule 165.7 as proposed. The Commission anticipates that these revisions will provide the public and claimants with greater transparency in the awards claim review process and enhance the expeditious and fair administration of the program. The Commission declines a commenter's request that the Commission publish NCAs for Related Actions. The Commission believes that doing so would be unworkable and burdensome for the Commission. Publishing NCAs on all criminal and civil actions that may become Related Actions would require staff to track, monitor, and report on many actions that are not Commission actions. Rule 165.7(b)(3) clearly describes how and when actions brought by other agencies become Related Actions and when a claimant must file a Form WB-APP with the Commission to apply for an award in connection with these actions. It is the claimant's responsibility to track the outcome of a Related Action if the claimant has an interest in pursuing an award application based on that Related Action.

    In response to the comment on the nature of the Claims Review staff, the Commission notes that the Claims Review Staff will be drawn from the Commission's Divisions and Offices, other than the Office of General Counsel. As detailed in Rule 165.7, the role of Claims Review Staff is primarily to make preliminary decisions on the merits of award applications including, if applicable, award amounts.19 Service by a Commission employee on the Claims Review Staff will be in addition to the other duties of the employee in their Division or Office. As is the case at the SEC, the Claims Review Staff will be assisted by staff from the Whistleblower Office who will assemble the factual record related to an award claim, provide analysis of an award claimant's eligibility and, if applicable, make a recommendation of a proposed award amount.

    19 The Commission will have an opportunity to review preliminary denial decisions that are contested by the claimant and all award recommendations. See Rule 165.7(j).

    Awards for Related Actions a. Proposed Rules

    For award claims on Related Actions, the Commission proposed to amend Rule 165.11 to permit claimants who are eligible to receive an award in a covered judicial or administrative action to also receive an award based on the monetary sanctions that are collected from a final judgment in a Related Action. The exception would be that the Commission would not make an award to a claimant for a Related Action if the claimant has been granted an award by the SEC for the same action under the SEC's whistleblower program. This would prevent a claimant from “double dipping” and receiving more than one award for the same action. Similarly, if the SEC has previously denied an award to a claimant in a Related Action, the claimant would be precluded from relitigating any issues before the Commission that the SEC resolved against the claimant as part of the SEC's award denial. The limitations on obtaining an award for both Covered Actions and final judgments in Related Actions are similar to those imposed by the SEC in its whistleblower program.

    A Related Action under Rule 165.2(m) is based on the original information voluntarily submitted by a whistleblower to the Commission that led to the successful enforcement of a Commission action, and therefore, an action may only become a Related Action after there is a successful Commission action. The Commission accordingly proposed revisions to clarify timing requirements for filing whistleblower award claims regarding Related Actions. The proposed revisions were intended to clarify that, except in the circumstances described in proposed Rule 165.7(b)(3)(ii), award claims for a Related Action shall be filed within 90 days after an action meets the definition of Related Action if the order in the Related Action was issued prior to the successful enforcement of a Commission action. The proposed revisions also clarify that award claims for a Related Action and in response to a Notice of Covered Action may be submitted on the same Form WB-APP in certain circumstances.

    b. Comments Received

    The Commission received one comment regarding Proposed Rule 165.11. The commenter expressed some confusion as to whether the information provided by a whistleblower must be presented to the Commission prior to presenting the information to another authority in order for a whistleblower to be eligible for an award in a Related Action.20 The commenter stated that the Commission should clarify that whistleblowers who first take their information to another authority and later provide their information to the Commission are eligible for an award.

    20See TAF comment letter.

    c. Final Rule

    The Commission has decided to adopt Rule 165.11 as proposed. The Commission also takes this opportunity to clarify that a whistleblower retains eligibility under Rule 165.11, Rule 165.5, and Rule 165.2(l) for an award based on information provided by the whistleblower to another authority prior to the time that the whistleblower provided the information to the Commission.

    Contents of Record for Award Determinations a. Proposed Rules

    The Commission proposed to amend Rule 165.10(a) to identify additional items that may be included in the contents of record for award claims as a result of the Commission's proposal to amend Rule 165.11 to permit claimants who are eligible to receive an award in a covered judicial or administrative action to also receive an award based on the monetary sanctions that are collected from a final judgment in a Related Action. For Related Actions, any documents or materials, including sworn declarations from third parties, that are received or obtained by the Whistleblower Office to assist the Commission in resolving the claimant's award application, including information relating to the claimant's eligibility, may be included in the record. In addition, any information provided to the Commission by the entity bringing the Related Action that has been authorized by the entity for sharing with the claimant may be part of the record. Neither of these types of information may be relied upon by the Commission or the Claims Review Staff in making a decision on a whistleblower award claim or included in the contents of the record if the entity did not authorize the Commission to share the information with the claimant.

    The Commission also proposed revisions to Rules 165.10(b) and 165.13(b) to clarify that the record on appeal shall not include any pre-decisional or internal deliberative process materials that are prepared to assist the Commission or Claims Review Staff in deciding a claim.

    b. Comments Received

    The Commission received one comment regarding the record for award determinations and appeals. This commenter strongly urged the Commission to further revise Proposed Rules 165.10 and 165.13 to not categorically exclude from the record pre-decisional and internal deliberative process materials prepared to assist the Commission in award determinations, and suggested that the Commission would be denying whistleblowers a meaningful right to appeal by defining by rule what constitutes the record.21

    21See TAF comment letter.

    c. Final Rule

    Following consideration of the comments received, the Commission has decided to adopt the revisions to Rules 165.10(a) and (b) and 165.13(b) as proposed. The Commission disagrees with the comment that the Commission defining by rule what constitutes the record denies a claimant a meaningful right to appeal award determinations.22 Under Rules 165.10 and 165.13, all factual materials relied on by Claims Review Staff or the Commission in making an award determination will be available to the claimant and reviewing court. The Commission believes that pre-decisional or internal deliberative process materials that are prepared to assist the Commission or Claims Review Staff from the record are protected by attorney-client privilege as well as attorney work product under well settled law. Similarly, the exclusion of any documents or materials provided by a third-party that have not been authorized for release by the third-party does not deny the claimant due process because these materials will not be considered by the Commission or Claims Review Staff in reaching a decision on the award claim.

    22 As an example, the commenter referred to appeals of IRS whistleblower cases (Insinga v. Commissioner, Tax Court Docket No. 9011-13W (July 27, 2016) and Whistleblower One 10683-13W et al. v. Commissioner, 145 T.C. No. 8 (September 16, 2015)) in which the whistleblower sought factual information in the underlying enforcement cases to determine whether the information the whistleblower provided the IRS contributed to the success of the enforcement action. The Commission believes its practice is distinguishable in that all of the facts that underlie the Commission's decision are included in the record under Rules 165.10 and 165.13.

    Authority To Administer the Program a. Proposed Rule

    The Commission proposed to directly assign responsibilities for administering the program by rule rather than by delegation in Rule 165.15 in light of the proposed changes to the claims review process. Since 2013, the Whistleblower Office has been located within the Division of Enforcement. The Commission believes that it is appropriate to assign overall responsibility for administering the whistleblower program to the Director of the Division of Enforcement. The Commission notes that this approach is consistent with the SEC's practice.

    The Commission also proposed to directly assign responsibility to Claims Review Staff for the issuance of Preliminary Determinations and Proposed Final Determinations, and issuance of Proposed Final Dispositions to the WBO. In this connection, the Commission proposed, again consistent with the SEC's practice, that no member of the Claims Review Staff can have had any direct involvement in the underlying enforcement case.

    b. Comments Received

    The Commission received no comments regarding the proposed changes to the authority to administer the whistleblower program.

    c. Final Rule

    The Commission has decided to adopt the revisions to the authority to administer the program as proposed.

    Whistleblower Identifying Information a. Proposed Rule

    Rule 165.4 implements the confidentiality protections for whistleblower identifying information contained in Section 23(h)(2). In proposed Rule 165.15(a)(3), the Commission proposed to authorize the Director of the Division of Enforcement to act on its behalf to disclose whistleblower identifying information as permitted by Section 23(h)(2)(C) and Rule 165.4(a)(2) and (3). The Commission stated in the Proposal that it expects the Director of Enforcement to exercise this discretion to release such sensitive information in a manner consistent with, and when deemed necessary or appropriate to accomplish, the customer protection and law enforcement goals of the whistleblower program. The Commission said in the Proposal that it believes that this delegation of authority will increase investor protection by facilitating administration of the whistleblower program as well as investigations and actions by those agencies and authorities that are eligible to receive whistleblower identifying information under Section 23(h)(2)(C) and Rule 165.4. Any agency or authority that receives whistleblower identifying information is bound by the same confidentiality requirements as those applicable to the Commission under Section 23(h)(2)(A) and such sharing of information does not change the confidential nature of the information. Certain information provided to other agencies or authorities is also protected from disclosure under Section 8 of the CEA. The Commission also proposed to revise a question in the Form TCR, question E.8, seeking consent from whistleblowers to share their information with other authorities.

    b. Comments Received

    The Commission received one comment opposing the proposed changes to Rule 165.4 and Form TCR. The commenter viewed the proposed changes as a “loosening” of the confidentiality of a whistleblower's identity. In addition, the commenter suggested that: (1) A whistleblower should be entitled to know the other agencies with which identifying information is shared; (2) the scope of the proposal on sharing the whistleblower's identifying information is too broad; and, (3) the Commission does not have the ability to monitor or enforce confidential treatment of the whistleblower's identifying information once it has been shared with other agencies. The commenter also suggested that the whistleblower should be consulted by the Commission prior to any sharing of the whistleblower's identifying information with other agencies and provided the opportunity to prevent such sharing because the whistleblower may have reported to the Commission rather than to another authority as the result of previous encounters with personnel at other agencies that left the whistleblower with less trust or confidence in those agencies. Finally, the commenter argued that the sharing of information with self-regulatory organizations is too broad because the term “self-regulatory organization” is not properly defined in the rules.23

    23See GS2Law comment letter.

    c. Final Rule

    After consideration of the comment received, the Commission is adopting Rule 165.4(a)(2) as proposed, with a minor change. Section 23(h)(2)(C) provides the Commission with the authority to share all information provided by the whistleblower with the authorities listed in that section without the consent or consultation of the whistleblower, subject to the limitation that providing the whistleblower's identifying information is necessary or appropriate to accomplish the purposes of the CEA and protect customers. Reassigning the authority to make the decision to disclose whistleblower identifying information in a manner permitted by Section 23(h)(2)(C) from the Director of the Whistleblower Office to a more senior Commission official, the Director of the Division of Enforcement, is not a loosening of whistleblower identity protections. The Commission believes that this delegation of authority will increase investor protection by facilitating administration of the whistleblower program as well as investigations and actions by those agencies and authorities that are eligible to receive whistleblower identifying information under Section 23(h)(2)(C) and Rule 165.4. Section 23(h)(2)(C)(i), Rule 165.4(a)(2), and the Privacy Act Notice on Form TCR identify for whistleblowers the entities with which whistleblower identifying information may be shared. If a potential whistleblower is not comfortable with the possibility that confidential information about them may be shared with one or more of these entities, the potential whistleblower can decide not to file a Form TCR.

    The Commission does not believe that Commission monitoring of the treatment of confidential whistleblower information by a receiving authority is necessary. As the commenter pointed out, receiving authorities are bound by the same confidentiality provisions as the Commission. The Commission makes sure that a receiving authority understands these limitations when it shares confidential whistleblower information with them. Further, all of the entities with which the Commission may share confidential information are experienced in handling and protecting confidential information such as whistleblower identifying information.

    The Commission does not agree with the commenter's assertion that “self-regulatory organization” is not defined. Section 23(h)(2)(C)(i)(III) limits the self-regulatory organizations with which confidential whistleblower information can be shared to those self-regulatory organizations that fit within the definition in section 3(a) of the Securities Exchange Act of 1934.24 This is the meaning of “self-regulatory organization” throughout Section 23 of the CEA and the part 165 Rules. To eliminate any confusion in this regard, the Commission is making conforming amendments throughout the Part 165 Rules to clarify that a self-regulatory organization is a self-regulatory organization as defined by section 3(a) of the Securities Exchange Act of 1934.

    24 15 U.S.C. 78c(a).

    Finally, in light of the comments, the Commission also has determined to remove Question E.8 on Form TCR. The wording of this question was not consistent with the authority granted to the Commission to share whistleblower identifying information in Section 23(h)(C)(i) and the language of Rule 165.4(a)(2). The Privacy Act Notice in Form TCR puts potential whistleblowers on notice that the information that they provide to the Commission may be shared with other authorities.

    Retaliation Against Whistleblowers a. Proposed Rule

    In the Proposal, the Commission proposed several substantial changes to its anti-retaliation authority. The Commission proposed revisions to Rule 165.19 and appendix A, and the addition of new Rule 165.20. The Commission proposed to amend Rule 165.19 to prohibit a person from taking any action to impede an individual from communicating directly with the Commission's staff about a possible violation of the CEA, including by enforcing, or threatening to enforce, a confidentiality agreement or predispute arbitration agreement with respect to such communications. The Commission also proposed to revise its 2011 interpretation that it lacked statutory authority to bring an enforcement action against an employer that retaliated against a whistleblower. The Commission proposed that Sections 6(c), 6(d), 6b, 6c, and 23(i) of the CEA allow the Commission to pursue such violations of the Act through an enforcement action. The Commission proposed Rule 165.20 to make clear that Section 23(h)(1)(A) of the CEA, including the rules in part 165 promulgated thereunder, is enforceable in an action or proceeding brought by the Commission. Proposed Rule 165.20(c) provides that the anti-retaliation protections apply irrespective of whether a whistleblower qualifies for an award. The Commission also proposed changes to appendix A to reflect the Commission's ability to bring enforcement actions to prosecute violations of the anti-retaliation prohibition of Section 23(h)(1)(A).

    b. Comments Received

    The Commission received several comments regarding the proposed revisions to the anti-retaliation provisions. The Commission received one comment letter that addressed the proposed revisions to Rules 165.19(b), 165.20(b) and 165.20(c) 25 and another comment letter focused on proposed Rule 165.20(c).26

    25See MY comment letter.

    26See MY and TAF comment letters.

    The comment on Rule 165.19(b) supported the proposal and noted that this change will more closely align the Commission with the SEC with respect to combating the chilling of whistleblowing by employers who require waivers of rewards in severance packages for whistleblowing.

    This commenter was similarly supportive of the proposed expansion of Commission enforcement authority to address retaliation against whistleblowers. This commenter noted that more substantial penalties or a government enforcement action would be more apt to deter retaliation against whistleblowers than only a private right of action.

    Both commenters asked the Commission to clarify its position on proposed Rule 165.20(c) with regard to taking enforcement action against employers that retaliate against whistleblowers prior to the whistleblower filing a Form TCR with the Commission. One commenter reiterated the point that many whistleblowers await the outcome of any internal investigation before providing the Commission any information.27 In the commenter's view, it would not be fair or in the public interest to leave such a whistleblower unprotected during this interim period between reporting internally and filing a Form TCR with the Commission. This commenter further explained that the Commission taking enforcement action when companies or individuals retaliate against whistleblowing activity prior to the filing of a Form TCR will create additional incentives for employees to report internally before providing information to the Commission.

    27See MY comment letter.

    c. Final Rule

    Having considered the fully supportive comment on Rules 165.19(b) and 165.20(b), the Commission is adopting these rules as proposed. The Commission is also re-organizing and making minor changes to proposed Appendix A to better reflect the fact that either the Commission or a private litigant can bring an action for a violation of Section 23(h)(1)(A).

    By adopting proposed Rule 165.20(b), the Commission is confirming its decision to revise its 2011 interpretation that it lacks the statutory authority to bring an enforcement case against an employer that violates the anti-retaliation prohibition in Section 23(h)(1). The 2011 interpretation failed to fully consider the statutory context of Section 23 and other CEA provisions. The 2011 interpretation does not comport with Section 23(h)(1)(A)'s prohibition against retaliation; the Commission's broad rulemaking authority under Section 23(i); and, the Commission's general authority to prosecute violations of any CEA provision (including Section 23(h)(1)(A)) as well as violations of the Commission's rules and orders under CEA sections 6(c), 6(d), 6b and 6c. Sections 6(c), 6(d), 6b and 6c of the Act empower the Commission to take actions for the violation of “any” CEA provision or rule or regulation thereunder. Although Section 23(h)(1)(B) provides a private right of action, nothing in that sub-section purports to limit the Commission's general enforcement authority or suggests that the private right of action is exclusive.

    With regard to Rule 165.20(c), the Commission has decided, after considering the comments received, to adopt it with some modification. The Commission believes these revisions will further encourage whistleblowers to report internally28 as well as deter retaliatory practices against whistleblowers.

    28 The part 165 Rules encourage whistleblowers to report internally prior to reporting to the Commission. Rule 165.2(l)(2), discussed above, allows a whistleblower to retain original source status after reporting internally. Additionally, Rule 165.9(b)(4) includes in the factors that may increase the amount of an award whether and the extent to which a whistleblower reported the possible violations through internal whistleblower, legal, or compliance procedures before or at the same time as reporting those violations to the Commission, and whether and the extent to which a whistleblower assisted any internal investigation or inquiry concerning the reported violations.

    It would be inconsistent for the Commission to encourage internal reporting by whistleblowers and not extend to them anti-retaliation protections to the extent the CEA permits. To do so would place whistleblowers who report internally in a worse position than whistleblowers who do not report internally prior to reporting to the Commission, forcing whistleblowers to choose between reporting internally first in the hopes of increasing any award or foregoing reporting internally in order to preserve anti-retaliation protections.

    However, the anti-retaliation protections in the CEA do not extend to all whistleblowers who report internally. Section 23(h) and Rule 165.20(a) provide that the whistleblower in a private action or the Commission in an enforcement action must be able to show that retaliation occurred because of any lawful act done by the whistleblower in providing information to the Commission in accordance with the part 165 rules, or assisting in any investigation or judicial or administrative action of the Commission based upon or related to such information. The ability to make this showing will depend on the facts and circumstances of a particular case. Actions that an employer took after a whistleblower reported internally but before providing information to the Commission may be relevant to whether retaliation that is prohibited under Section 23(h)(1) occurred. For this reason, the Commission is adding language to Rule 165.20(b) to explicitly recognize this possibility.

    Payment of Awards a. Comment Received

    The Commission proposed no revisions to Rule 165.14 on the payment of awards. However, the Commission received one comment regarding the payment of awards.29 This commenter noted that the current part 165 Rules do not make available the payment of the minimum amount of an award (10%) until the whistleblower's time to appeal has expired, and suggested that the rules be amended to provide for payment of the minimum amount of an award at the time the order of award is issued. This commenter argued that once an award has been ordered by the Commission, the Commission has admitted that there is an entitlement to an award and the Commission is estopped from later removing an award during the appeal process. In addition, this commenter stated that often the elapsed time between the whistleblower's original tip and any award is measured in years, not weeks or months, and that waiting on the resolution of any appeals would only lengthen that timeframe.

    29See GS2Law comment letter.

    b. Final Rule

    The Commission declines the request to amend Rule 165.14 to permit payment of any portion of an award prior to the completion of the appeals process for all whistleblower award claims arising from a NCA or Related Action.

    Section 23(f)(2) provides that the Commission's determination to whom to pay an award and the amount of any award is appealable to the appropriate U.S. Court of Appeals. In response to an appeal from a whistleblower who received no award from the Commission or who disagreed with the amount of a Commission award, a Court of Appeals could set aside the Commission's decision to make an award to another whistleblower under the same NCA or Related Action if that award decision does not meet the applicable standard of review.30 This possibility makes it prudent for the Commission to refrain from paying any portion of an award until the completion of the appeals process for all whistleblower award claims arising from an NCA or a Related Action as provided in Rule 165.14(b)(2). As a result, the Commission is not making any changes to Rule 165.14 in response to the comment.

    30 7 U.S.C. 26(f)(3) states that the court shall review the determination made by the Commission in accordance with section 706 of title 5.

    Office of Consumer Outreach a. Amendment

    The office formerly known as the Office of Consumer Outreach has changed its name to the Office of Customer Education and Outreach. The Commission is renaming the Office in Rule 165.12. Because Rule 165.12 is a rule of the Commission's “organization, procedure or practice” the Commission need not present this revision for notice and comment.31

    31See 5 U.S.C. 553.

    Conforming and Technical Amendments a. Proposed Amendments

    To conform to the proposed changes to Rules 165.7 and 165.15, the Commission proposed to strike the reference to “or its delegate” in Rule 165.11 in the undesignated material before paragraph (a).

    The Commission proposed to amend Rule 165.2(i)(2) concerning the definition of information that led to a successful enforcement action because it contains an erroneous cross-reference. The reference is intended to be to 165.2(l) regarding the definition of original source. The rule currently refers to paragraph (i) of this section.

    The Commission proposed to make a minor change to the wording of Rule 165.3 concerning the procedures for submitting original information because it contains an erroneous reference to a two-step process. This change makes the language conform to the process previously adopted.32

    32Whistleblower Incentives and Protection, 76 FR at 53183 (Aug. 25, 2011) (explaining that the rule was adopted with a more streamlined process and one less form than the original proposal).

    The Commission proposed to amend Rule 165.13(b) concerning appeals because it contains an erroneous cross-reference. The reference intended is to Rule 165.10 regarding contents of the record, rather than Rule 165.9 regarding criteria for determining award amounts.

    The Commission proposed to move and include updated Form TCR and Form WB-APP in a new appendix B to part 165. The updated Form TCR and Form WB-APP include revisions that previously received information collection requirement approval by the Office of Management and Budget.33 The Commission also proposed revisions to the submission instructions portions of the forms to conform to the proposed revisions in the part 165 Rules.

    33 The Form TCR and Form WB-APP OMB Control Number is 3038-0082. Both forms last received OMB approval on April 8, 2015, with an expiration date of April 30, 2018.

    Finally, the Commission proposed to make a minor change in the wording of current § 165.7(e), in addition to designating current paragraph (e) as new paragraph (l).

    b. Comments Received

    The Commission received no comments regarding the proposed conforming and technical amendments.

    c. Final Rules

    The Commission has decided to adopt the conforming and technical amendments as proposed.

    III. Related Matters A. Regulatory Flexibility Certification

    The Regulatory Flexibility Act 34 requires that agencies consider whether the rules they propose will have a significant economic impact on a substantial number of small entities and, if so, provide a regulatory flexibility analysis respecting the impact.35 In the Commission's Proposing Release, the Chairman, on behalf of the Commission, certified that a regulatory flexibility analysis is not required because the persons that would be subject to the rules—individuals—are not “small entities” for purposes of the Regulatory Flexibility Act and the rules therefore would not have a significant economic impact on a substantial number of small entities. The Commission received no comments regarding this conclusion.

    34 5 U.S.C. 601, et seq.

    35Id.

    B. Paperwork Reduction Act

    The Paperwork Reduction Act (PRA), 44 U.S.C. 3501-3521, imposes certain requirements on federal agencies (including the Commission) in connection with their conducting or sponsoring any collection of information as defined by the PRA. The Commission believes that the amendments will not impose new recordkeeping or information collection requirements that require approval by the Office of Management and Budget under the PRA.

    C. Cost-Benefit Considerations

    CEA Section 15(a) requires the Commission to consider the costs and benefits of its actions before promulgating a regulation under the CEA or issuing certain orders.36 Section 15(a) further specifies that the costs and benefits shall be evaluated in light of the following five factors: (1) Protection of market participants and the public; (2) efficiency, competitiveness, and financial integrity of futures markets; (3) price discovery; (4) sound risk management practices; and (5) other public interest considerations. The Commission considers the costs and benefits resulting from its discretionary determinations with respect to the Section 15(a) factors. The Commission may in its discretion give greater weight to any one of the five enumerated areas and could in its discretion determine that, notwithstanding its costs, a particular rule is necessary or appropriate to protect the public interest or to effectuate any of the provisions or accomplish any of the purposes of the CEA.

    36 7 U.S.C. 19(a).

    Since the basic framework of part 165 remains substantially unchanged, the Commission believes that the costs and benefits of the rule amendments and the status quo baseline (the current rule), to which the rules' costs and benefits are compared, are similar, but with certain additional benefits attendant to these amendments.37 The Rule 165.7 amendments will add transparency to the Commission's process of deciding whistleblower award claims and will harmonize the Commission's rules with those of the SEC. The amendments clarify each step of the process that a whistleblower must follow when making an award claim. The Commission believes that such transparency and harmonization will increase the benefits of the part 165 Rules relative to the benefits of the current rules because potential whistleblowers will have greater clarity about the claims and awards process and greater assurance that retaliation will not be tolerated. The Commission believes this clarity and protection will encourage whistleblowers to step forward. Thus, the rules should enhance protection of market participants and the public as well as market integrity without materially adding to the costs attendant to the current regime.

    37 The Commission believes that there is not likely to be any material difference between the amendments and the status quo baseline in terms of cost.

    The Rule 165.4 and 165.15 amendments assign to the Director of the Division of Enforcement the authority to administer the whistleblower program and release whistleblower identifying information. Since these amendments relate solely to the Commission's allocation of authority among its staff, the Commission believes that these changes will impose no material costs on market participants or the public. At the same time, the Commission believes the protection of market participants and the public will be enhanced through a more effective and efficient deployment of staff resources.

    The Rule 165.19 and 165.20 amendments clarify the anti-retaliation protections available under the Commission's whistleblower program in light of the Commission's reconsideration of its authority under Section 23(h)(1) in conjunction with Sections 6(c), 6(d), 6b, 6c, and 23(i) of the CEA. These changes remove any gap in enforcement authority between the Commission and the SEC with regard to whistleblower protections against retaliation. The Commission believes that these changes will impose no material costs on market participants or the public. The rules do not impose any new regulatory burden.38 To comply with the rules, market participants must refrain from engaging in conduct that is already subject to private rights of action, or including certain provisions waiving rights and remedies or requiring arbitration of disputes in employment agreements. The Commission further believes that the rules will have a positive effect on efficiency, competitiveness, and financial integrity of the markets that the Commission regulates through improving detection and remediation of potential violations of the CEA and Commission regulations. For instance, market participants may be further deterred from engaging in violations of the CEA and Commission rules because the likelihood of being caught has increased due to improvements to the whistleblower program that encourage more whistleblowers to provide information to the Commission.

    38 The Commission believes that the new rule provision regarding Commission enforcement does not significantly affect any reliance interests because the provision relates to conduct that is already prohibited by Section 23 of the CEA.

    The Commission believes that price discovery and sound risk management practices will not be materially affected by the amendments. Also, the Commission has not identified any other relevant public interest considerations.

    The Commission invited public comment on its cost-benefit considerations, including the Section 15(a) factors described above. Commenters were invited to submit any data or other information that they had that quantified or qualified the costs and benefits of the Proposal. None of the commenters submitted any data or other information that quantified or qualified the costs and benefits of the proposed rules, nor did they otherwise comment on the cost-benefit considerations as stated in the proposed rules.

    Alternatives Suggested by Commenters

    The Commission adopts several alternatives and makes certain clarifications as suggested by commenters to the proposal:

    • After consideration of the comments on Rule 165.2(l), the Commission adopts the rule with one change and a correction. The Commission is adding foreign futures authorities to the authorities and entities to which a claimant may provide information prior to filing a Form TCR and retain original source status.

    • The Commission clarifies that the 180-day timeframe in Rule 165.2(l)(2) relates only to the date on which the Commission will consider a whistleblower's original information to have been received. Filing a Form TCR more than 180 days after reporting information to another authority does not strip a whistleblower of original source status or render a whistleblower ineligible for an award.

    • The Commission is adopting Rule 165.4(a)(2) as proposed, with a minor change. Section 23(h)(2)(C)(i), Rule 165.4(a)(2), and the Privacy Act Notice on Form TCR identify for whistleblowers the entities with which whistleblower identifying information may be shared.

    • Section 23(h)(2)(C)(i)(III) limits the self-regulatory organizations with which confidential whistleblower information can be shared to those self-regulatory organizations that fit within the definition in section 3(a) of the Securities Exchange Act of 1934.39 The Commission is making conforming amendments throughout the part 165 Rules to clarify that a self-regulatory organization is a self-regulatory organization as defined by section 3(a) of the Securities Exchange Act of 1934.

    39Infra, footnote 24.

    • The Commission has determined to remove Question E.8 on Form TCR. The wording of this question was not consistent with the authority granted to the Commission to share whistleblower identifying information in Section 23(h)(C)(i) and the language of Rule 165.4(a)(2). The Privacy Act Notice in Form TCR puts potential whistleblowers on notice that the information that they provide to the Commission may be shared with other authorities.

    • The Commission has decided to adopt Rule 165.20(c) with some modification. The anti-retaliation protections in the CEA do not extend to all whistleblowers who report internally. Actions that an employer took after a whistleblower reported internally but before providing information to the Commission may be relevant to whether retaliation that is prohibited under Section 23(h)(1) occurred. For this reason, the Commission is adding language to Rule 165.20(b) to explicitly recognize this possibility.

    The Commission also received alternatives to the final rule from commenters that it chooses not to adopt:

    • The Commission does not elect to extend the deadline beyond 180 days under 165.2(l) to retain status as the original source of information after first submitting the information to Congress, any federal or state authority, a registered entity, a registered futures association, a self-regulatory organization, or to any persons described in paragraphs (g)(4) and (5) of Rule 165.2 to be eligible for an award. The Commission believes that 180 days provides ample time for a whistleblower to provide information to the Commission after submitting the information to any of the aforementioned entities or authorities.

    • The Commission declines a commenter's request that the Commission publish NCAs for Related Actions. The Commission believes that doing so would be unworkable and burdensome for the Commission. Publishing NCAs on all criminal and civil actions that may become related actions would require staff to track, monitor, and report on many actions that are not Commission actions.

    • The Commission has chosen not to further revise Proposed Rules 165.10 and 165.13 to not categorically exclude from the record pre-decisional and internal deliberative process materials prepared to assist the Commission in award determinations. Under Rules 165.10 and 165.13, all factual materials relied on by Claims Review Staff or the Commission in making an award determination will be available to the claimant and reviewing court. The Commission believes that pre-decisional or internal deliberative process materials that are prepared to assist the Commission or Claims Review Staff are protected by attorney-client privilege as well as attorney work product under well settled law. Similarly, the exclusion of any documents or materials provided by a third-party that have not been authorized for release by the third-party does not deny the claimant due process because these materials will not be considered by the Commission or Claims Review Staff in reaching a decision on the award claim.

    • The Commission declines the request to amend Rule 165.14 to permit payment of any portion of an award prior to the completion of the appeals process for all whistleblower award claims arising from a NCA or related action. Section 23(f)(2) provides that the Commission's determination to whom to pay an award and the amount of any award is appealable to the appropriate U.S. Court of Appeals. In response to an appeal from a whistleblower who received no award from the Commission or who disagreed with the amount of a Commission award, a Court of Appeals could set aside the Commission's decision to make an award to another whistleblower under the same NCA or Related Action if that award decision does not meet the applicable standard of review.40 This possibility makes it prudent for the Commission to refrain from paying any portion of an award until the completion of the appeals process for all whistleblower award claims arising from an NCA or a related action as provided in Rule 165.14(b)(2).

    40Infra, footnote 30.

    • The Commission does not believe that Commission monitoring of the treatment of confidential whistleblower information by a receiving authority is necessary. Receiving authorities are bound by the same confidentiality provisions as the Commission. The Commission makes sure that a receiving authority understands these limitations when it shares confidential whistleblower information with them.

    D. Antitrust Considerations

    Section 15(b) of the CEA requires the Commission to consider the public interests protected by the antitrust laws and to take actions involving the least anti-competitive means of achieving the objectives of the CEA. The Commission believes that the rules may have a positive effect on competition through improving detection, deterrence, and remediation of potential violations of the CEA and Commission regulations.

    The Commission did not receive any comments on any antitrust considerations arising from the proposed amendments.

    E. Small Business Regulatory Enforcement Fairness Act

    Under the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Pub. L. 104-121 (March 29, 1996), as amended by Pub. L. 110-28 (May 25, 2007), the Commission solicits data to determine whether a proposed rule constitutes a “major” rule. Under SBREFA, a rule is considered “major” where, if adopted, it results or is likely to result in:

    • An annual effect on the economy of $100 million or more (either in the form of an increase or a decrease);

    • A major increase in costs or prices for consumers or individual industries; or

    • Significant adverse effects on competition, investment or innovation.

    If a rule is “major,” its effectiveness will generally be delayed for 60 days pending Congressional review.

    The Commission received no comments or data on: The potential annual effect on the economy; any increase in costs or prices for consumers or individual industries; and any potential effect on competition, investment or innovation and the Chairman certifies that these amendments do not constitute a “major rule”.

    List of Subjects in 17 CFR Part 165

    Whistleblowing.

    For the reasons set forth in the preamble, the Commodity Futures Trading Commission amends 17 CFR part 165 as follows:

    PART 165—WHISTLEBLOWER RULES 1. The authority citation for part 165 is revised to read as follows: Authority:

    7 U.S.C. 2, 5, 9, 12a(5), 13a, 13a-1, 13b, and 26.

    2. In § 165.2, revise paragraphs (i)(2) and (3), (l)(1)(i), (l)(2), and (o) to read as follows:
    § 165.2 Definitions.

    (i) * * *

    (2) The whistleblower gave the Commission original information about conduct that was already under examination or investigation by the Commission, the Congress, any other authority of the federal government, a state Attorney General or securities regulatory authority, any registered entity, registered futures association, or self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)), foreign futures authority, or the Public Company Accounting Oversight Board (except in cases where the whistleblower was an original source of this information as defined in paragraph (l) of this section), and the whistleblower's submission significantly contributed to the success of the action.

    (3) The whistleblower reported original information through an entity's internal whistleblower, legal, or compliance procedures for reporting allegations of possible violations of law before or at the same time the whistleblower reported them to the Commission; the entity later provided the whistleblower's information to the Commission, or provided results of an audit or investigation initiated in whole or in part in response to information the whistleblower reported to the entity; and the information the entity provided to the Commission satisfies either paragraph (i)(1) or (2) of this section. Under this paragraph (i)(3), the whistleblower must also submit the same information to the Commission in accordance with the procedures set forth in § 165.3 within 180 days of providing it to the entity.

    (l) * * *

    (1) * * *

    (i) In order to be considered an original source of information that the Commission receives from Congress, any other federal, state or local authority, a foreign futures authority, any registered entity, registered futures association, or any self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)), the whistleblower must have voluntarily given such authorities the information within the meaning of this part. In determining whether the whistleblower is the original source of information, the Commission may seek assistance and confirmation from one of the other entities or authorities described in this paragraph (l)(1)(i).

    (2) Information first provided to another authority or person. If the whistleblower provides information to Congress, any other federal, state, or local authority, a foreign futures authority, a registered entity, a registered futures association, a self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)), or to any of the persons described in paragraphs (g)(4) and (5) of this section, and the whistleblower, within 180 days, makes a submission to the Commission pursuant to § 165.3, as the whistleblower must do in order for the whistleblower to be eligible to be considered for an award, then, for purposes of evaluating the whistleblower's claim to an award under § 165.7, the Commission will consider that the whistleblower provided original information as of the date of the whistleblower's original disclosure, report, or submission to one of these other authorities or persons. The whistleblower must establish the whistleblower's status as the original source of such information, as well as the effective date of any prior disclosure, report, or submission, to the Commission's satisfaction. The Commission may seek assistance and confirmation from the other authority or person in making this determination.

    (o) Voluntary submission or voluntarily submitted. (1) The phrase “voluntary submission” or “voluntarily submitted” within the context of submission of original information to the Commission under this part, shall mean the provision of information made prior to any request from the Commission, Congress, any other federal or state authority, the Department of Justice, a registered entity, a registered futures association, or a self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)) to the whistleblower or anyone representing the whistleblower (such as an attorney) about a matter to which the information in the whistleblower's submission is relevant. If the Commission or any of these other authorities makes a request, inquiry, or demand to the whistleblower or the whistleblower's representative first, the whistleblower's submission will not be considered voluntary, and the whistleblower will not be eligible for an award, even if the whistleblower's response is not compelled by subpoena or other applicable law. For purposes of this paragraph (o), the whistleblower will be considered to have received a request, inquiry or demand if documents or information from the whistleblower is within the scope of a request, inquiry, or demand that the whistleblower's employer receives, unless, after receiving the documents or information from the whistleblower, the whistleblower's employer fails to provide the whistleblower's documents or information to the requesting authority in a timely manner.

    (2) In addition, the whistleblower's submission will not be considered voluntary if the whistleblower is under a pre-existing legal or contractual duty to report the violations that are the subject of the whistleblower's original information to the Commission, Congress, any other federal or state authority, the Department of Justice, a registered entity, a registered futures association, or a self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)), or a duty that arises out of a judicial or administrative order.

    3. Amend § 165.3 as follows: a. Remove the introductory text; and b. Revise paragraphs (a) introductory text and (a)(1).

    The revisions read as follows:

    § 165.3 Procedures for submitting original information.

    (a) A whistleblower will need to submit the whistleblower's information to the Commission. A whistleblower may submit the whistleblower's information:

    (1) By completing and submitting a Form TCR online and submitting it electronically through the Commission's Web site at http://www.cftc.gov, or the Commission's Whistleblower Program Web site at www.whistleblower.gov; or

    4. In § 165.4, revise paragraphs (a) introductory text and (a)(1) and (2) to read as follows:
    § 165.4 Confidentiality.

    (a) In general. Section 23(h)(2) of the Commodity Exchange Act requires that the Commission not disclose information that could reasonably be expected to reveal the identity of a whistleblower, except that the Commission may disclose such information in the following circumstances, in accordance with the Privacy Act of 1974 (5 U.S.C. 552a):

    (1) When disclosure is required to a defendant or respondent in connection with a public proceeding that the Commission institutes or in another public proceeding that is filed by an authority to which the Commission provides the information, as described in paragraph (a)(2) of this section; or

    (2) When the Commission determines that it is necessary to accomplish the purposes of the Commodity Exchange Act and to protect customers, it may provide whistleblower information, without the loss of its status as confidential whistleblower information in the hands of the Commission, to: The Department of Justice; an appropriate department or agency of the Federal Government, acting within the scope of its jurisdiction; a registered entity, registered futures association, or a self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)); a State attorney general in connection with a criminal investigation; any appropriate State department or agency, acting within the scope of its jurisdiction; or a foreign futures authority; and, as set forth in section 23(h)(2)(C) of the Commodity Exchange Act, each such entity is required to maintain the information as confidential in accordance with the requirements of section 23(h)(2)(A) of the Commodity Exchange Act.

    5. Revise § 165.5 to read as follows:
    § 165.5 Requirements for consideration of an award.

    (a) Subject to the eligibility requirements described in this part, the Commission will pay an award to one or more whistleblowers who:

    (1) Provide a voluntary submission to the Commission;

    (2) That contains original information; and

    (3) That leads to the successful resolution of a covered judicial or administrative action or successful enforcement of a Related Action or both; and

    (b) In order to be eligible, the whistleblower must:

    (1) Have voluntarily provided the Commission original information in the form and manner that the Commission requires in § 165.3;

    (2) Have submitted a claim in response to a Notice of Covered Action or a final judgment in a Related Action or both;

    (3) Provide the Commission, upon its staff's request, certain additional information, including:

    (i) Explanations and other assistance, in the manner and form that staff may request, in order that the staff may evaluate the use of the information submitted related to the whistleblower's application for an award;

    (ii) All additional information in the whistleblower's possession that is related to the subject matter of the whistleblower's submission related to the whistleblower's application for an award; and

    (iii) Testimony or other evidence acceptable to the staff relating to the whistleblower's eligibility for an award; and

    (4) If requested by the Whistleblower Office, enter into a confidentiality agreement in a form acceptable to the Whistleblower Office, including a provision that a violation of the confidentiality agreement may lead to the whistleblower's ineligibility to receive an award.

    (c) The Commission may, in its sole discretion, waive any procedural requirements based upon a showing of extraordinary circumstances.

    6. In § 165.6, revise paragraph (a)(1) to read as follows:
    § 165.6 Whistleblowers ineligible for an award.

    (a) * * *

    (1) To any whistleblower who is, or was at the time the whistleblower acquired the original information submitted to the Commission, a member, officer, or employee of: the Commission; the Board of Governors of the Federal Reserve System; the Office of the Comptroller of the Currency; the Board of Directors of the Federal Deposit Insurance Corporation; the Director of the Office of Thrift Supervision; the National Credit Union Administration Board; the Securities and Exchange Commission; the Department of Justice; a registered entity; a registered futures association; a self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)); or a law enforcement organization;

    7. Amend § 165.7 as follows: a. Revise the section heading; b. Revise paragraphs (b), (d), and (e); and c. Add paragraphs (f) through (l).

    The revisions and additions read as follows:

    § 165.7 Procedures for award applications in Commission actions and related actions, and Commission award determinations.

    (b)(1) To file a claim for a whistleblower award, the whistleblower must file Form WB-APP, Application for Award for Original Information Provided Pursuant to Section 23 of the Commodity Exchange Act. The whistleblower must sign this form as the claimant and submit it to the Commission by mail or fax to Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581, Fax (202) 418-5975, or by completing and submitting the Form WB-APP online and submitting it electronically through the Commission's Web site at https://www.cftc.gov or the Commission's Whistleblower Program Web site at https://www.whistleblower.gov.

    (2) The Form WB-APP, including any attachments, must be received by the Commission within 90 calendar days of the date of the Notice of Covered Action or 90 calendar days following the date of a final judgment in a Related Action (or if the final judgment in a Related Action was issued prior to the action meeting the definition of Related Action, within 90 calendar days following the date the action satisfied the definition of Related Action, except in the circumstances described in paragraph (b)(3)(ii) of this section). One Form WB-APP may be filed in response to both a Notice of Covered Action and final judgment in a Related Action if the relevant time periods are applicable.

    (3) If a covered judicial or administrative action and Related Action have different final judgment dates or if there is no covered judicial or administrative action connected to a Related Action, a claimant, who wishes to file a claim for an award in both a covered judicial or administrative action and a Related Action, or in a Related Action that does not have a connected covered judicial or administrative action, must follow one of the following procedures depending on that claimant's particular situation.

    (i) If a final judgment imposing monetary sanctions in a Related Action has not been entered at the time the claimant submits a claim for an award in connection with a covered judicial or administrative action, the claimant must submit the claim for the Related Action on Form WB-APP within ninety (90) calendar days following the date of issuance of a final judgment in the Related Action.

    (ii) If a final judgment in a Related Action has been entered and a Notice of Covered Action for a related covered judicial or administrative action has not been published, a claimant for an award in both the covered judicial or administrative action and Related Action may submit the claims for both the Related Action and the covered judicial or administrative action within ninety (90) days of the date of the Notice of Covered Action. The claims may be submitted on the same Form WB-APP.

    (iii) If there is a final judgment in a Related Action that relates to a judicial or administrative action brought by the Commission under the Commodity Exchange Act that is not a covered judicial or administrative action, and therefore there is no Notice of Covered Action, a claimant for an award in connection with the Related Action must submit the claim in connection with the Related Action on Form WB-APP within ninety (90) calendar days following either:

    (A) The date of issuance of a final judgment in the Related Action, if that date is after the date of issuance of the final judgment in the related Commission judicial or administrative action; or

    (B) The date of issuance of the final judgment in the related Commission judicial or administrative action, i.e., the date the Related Action becomes a Related Action, if the date of issuance of the final judgment in the Related Action precedes the final judgment in the related Commission judicial or administrative action.

    (d) A claimant may withdraw a Form WB-APP by submitting a written request to the Whistleblower Office at any time during the review process.

    (e)(1) The Whistleblower Office may issue a Proposed Final Disposition for award applications that do not relate to a Notice of Covered Action, a final judgment in a Related Action, or a previously filed Form TCR without presentation of the award claim to the staff designated by the Director of the Division of Enforcement under § 165.15(a)(2) (“Claims Review Staff”). In such instances, the Whistleblower Office will inform the award claimant in writing that the claim does not relate to a Notice of Covered Action, a final judgment in a Related Action, or a previously filed Form TCR and will be rejected unless the claimant provides additional information. The claimant will have 30 days from the date of the written notice to respond and to correct the identified deficiencies. If the claimant does not respond in 30 days or if the response does not include information showing that the WB-APP relates to a Notice of Covered Action, a final judgment in a Related Action, or a previously filed Form TCR the Whistleblower Office will issue a Proposed Final Disposition. The claimant's failure to submit a timely response to the written notice from the Whistleblower Office will constitute a failure to exhaust administrative remedies, and the claimant will be prohibited from pursuing an appeal under § 165.13.

    (2) The Whistleblower Office will notify the Claims Review Staff of any Proposed Final Disposition under this paragraph (e). Within thirty (30) calendar days thereafter, any member of the Claims Review Staff may request that the Proposed Final Disposition be reviewed by the Claims Review Staff. If no member of the Claims Review Staff requests such a review within the 30-day period, then the Proposed Final Disposition will become the Final Order of the Commission. In the event that a member of the Claims Review Staff requests a review, the Claims Review Staff will review the record that the Whistleblower Office relied upon in making its determination and either remand to the Whistleblower Office for further action or issue a Final Order of the Commission, which could consist of the Proposed Final Disposition.

    (f)(1) In connection with each individual covered judicial or administrative action or final judgment in a Related Action, for which an award application is submitted, once the time for filing any appeals of the covered judicial or administrative action or the final judgment in the Related Action has expired (or, where an appeal is filed of the covered judicial or administrative action, or the final judgment in a Related Action, as applicable, and concluded), the Claims Review Staff designated under § 165.15(a)(2) will evaluate all timely whistleblower award claims submitted on Form WB-APP in response to a Notice of Covered Action, referenced in paragraph (a) of this section, or final judgment in a Related Action in accordance with the criteria set forth in this part.

    (2) The Whistleblower Office may require that the claimant provide additional information relating to the claimant's eligibility for an award or satisfaction of any of the conditions for an award, as set forth in § 165.5(b)(2). The Whistleblower Office may also request additional information from the claimant in connection with the claim for an award in a Related Action to demonstrate that the claimant directly (or through the Commission) voluntarily provided the governmental agency, regulatory authority or self-regulatory organization the original information that led to the Commission's successful covered action, and that the information provided by the claimant led to the successful enforcement of the Related Action. The Whistleblower Office may also, in its discretion, seek assistance and confirmation from the other agency in making this determination.

    (g)(1) Following Claims Review Staff evaluation, the Claims Review Staff will issue a Preliminary Determination setting forth a preliminary assessment as to whether the claim should be granted or denied and, if granted, setting forth the proposed award percentage amount. The Whistleblower Office will send a copy of the Preliminary Determination to the claimant.

    (2) The claimant may contest the Preliminary Determination made by the Claims Review Staff by submitting a written response to the Whistleblower Office setting forth the grounds for the claimant's objection to either the denial of an award or the proposed amount of an award. The response must be in the form and manner that the Whistleblower Office shall require. The claimant may also include documentation or other evidentiary support for the grounds advanced in the claimant's response. The claimant may also request a meeting with the Whistleblower Office within the timeframes provided in this paragraph (g), however such meetings are not required, and the Whistleblower Office may in its sole discretion deny the request.

    (i) Before determining whether to contest a Preliminary Determination, the claimant may, within thirty (30) days of the date of the Preliminary Determination, request that the Whistleblower Office make available for the claimant's review the materials from among those set forth in § 165.10 that formed the basis of the Claims Review Staff's Preliminary Determination.

    (ii) If the claimant decides to contest the Preliminary Determination, the claimant must submit the claimant's written response and supporting materials setting forth the grounds for the claimant's objection to either the denial of an award or the proposed amount of an award within sixty (60) calendar days of the date of the Preliminary Determination, or if a request to review materials used to make a Preliminary Determination is made pursuant to paragraph (g)(2)(i) of this section, then within sixty (60) calendar days of the Whistleblower Office making those materials available for the claimant's review. The claimant also may request a meeting with the Whistleblower Office within those same sixty (60) calendar days. However, such meetings are not required and the Whistleblower Office may in its sole discretion decline the request.

    (h) If the claimant fails to submit a timely response pursuant to paragraph (g) of this section, then the Preliminary Determination will become the Final Order of the Commission (except where the Preliminary Determination recommended an award, in which case the Preliminary Determination will be deemed a Proposed Final Determination for purposes of paragraph (j) of this section). The claimant's failure to submit a timely response contesting a Preliminary Determination will constitute a failure to exhaust administrative remedies, and the claimant will be prohibited from pursuing an appeal under § 165.13.

    (i) If the claimant submits a timely response under paragraph (g) of this section, then the Claims Review Staff will consider the issues and grounds advanced in the claimant's response, along with any supporting documentation the claimant provided, and will make its Proposed Final Determination.

    (j) The Whistleblower Office will notify the Commission of each Proposed Final Determination. Within thirty (30) calendar days thereafter, any Commissioner may request that the Proposed Final Determination be reviewed by the Commission. If no Commissioner requests such a review within the 30-day period, then the Proposed Final Determination will become the Final Order of the Commission. In the event a Commissioner requests a review, the Commission will review the record that the staff relied upon in making its determinations, including the claimant's submissions to the Whistleblower Office, and issue its Final Order.

    (k) A Preliminary Determination, Proposed Final Disposition, or a Proposed Final Determination may be issued only after a review for legal sufficiency by the Office of the General Counsel.

    (l) The Office of the Secretariat will serve the claimant with the Final Order of the Commission.

    8. In § 165.9, revise the introductory text to read as follows:
    § 165.9 Criteria for determining amount of award.

    The determination of the amount of an award shall be in the discretion of the Commission. This discretion shall be exercised as prescribed by § 165.7.

    9. Amend § 165.10 as follows: a. Revise the section heading; b. Remove the word “and” at the end of paragraph (a)(6); c. Remove the period at the end of paragraph (a)(7) and add a semicolon in its place; d. Add paragraphs (a)(8) and (9); and e. Revise paragraph (b).

    The revisions and additions read as follows:

    § 165.10 Contents of record for award determination.

    (a) * * *

    (8) With respect to an award claim involving a Related Action, any statements or other information that an entity provides or identifies in connection with an award determination, provided the entity has authorized the Commission to share the information with the claimant. (Neither the Commission nor the Claims Review Staff may rely upon information that the entity has not authorized the Commission to share with the applicant); and

    (9) Any other documents or materials including sworn declarations from third-parties that are received or obtained by the Whistleblower Office to assist the Commission resolve the applicant's award application, including information related to the claimant's eligibility. (Neither the Commission nor the Claims Review Staff may rely upon information that a third party has not authorized the Commission to share with the claimant).

    (b) The rules in this part do not entitle a claimant to obtain from the Commission any materials (including any pre-decisional or internal deliberative process materials that are prepared to assist the Commission or Claims Review Staff in deciding the claim) other than those listed in paragraph (a) of this section. The Whistleblower Office may make redactions as necessary to comply with any statutory restrictions, to protect the Commission's law enforcement and regulatory functions, and to comply with requests for confidential treatment from other law enforcement and regulatory authorities.

    10. Revise § 165.11 to read as follows:
    § 165.11 Awards based upon related actions.

    (a) Provided that a whistleblower or whistleblowers comply with the requirements in §§ 165.3, 165.5 and 165.7, and pursuant to § 165.8, the Commission may grant an award based on the amount of monetary sanctions collected in a “Related Action” or “Related Actions”, where:

    (1) A “Related Action” is a judicial or administrative action that is brought by:

    (i) The Department of Justice;

    (ii) An appropriate department or agency of the Federal Government, acting within the scope of its jurisdiction;

    (iii) A registered entity, registered futures association, or self-regulatory organization (as defined in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a));

    (iv) A State criminal or appropriate civil agency, acting within the scope of its jurisdiction; or

    (v) A foreign futures authority; and

    (2) The “Related Action” is based on the original information that the whistleblower voluntarily submitted to the Commission and led to a successful resolution of the Commission judicial or administrative action.

    (b) The Commission will not make an award to a claimant for a final judgment in a Related Action if the claimant has already been granted an award by the Securities and Exchange Commission (SEC) for that same action pursuant to its whistleblower award program under section 21F of the Securities Exchange Act (15 U.S.C. 78a et seq.). If the SEC has previously denied an award to the claimant for a judgment in a Related Action, the whistleblower will be precluded from relitigating any issues before the Commission that the SEC resolved against the claimant as part of the award denial.

    11. In § 165.12, revise paragraph (c) to read as follows:
    § 165.12 Payment of awards from the Fund, financing of customer education initiatives, and deposits and credits to the Fund.

    (c) Office of Customer Education and Outreach. The Commission shall undertake and maintain customer education initiatives through its Office of Customer Education and Outreach. The initiatives shall be designed to help customers protect themselves against fraud or other violations of the Commodity Exchange Act, or the rules or regulations thereunder. The Commission shall fund the initiatives and may utilize funds deposited into the Fund during any fiscal year in which the beginning (October 1) balance of the Fund is greater than $10,000,000. The Commission shall budget, on an annual basis, the amount used to finance customer education initiatives, taking into consideration the balance of the Fund.

    12. Revise § 165.13 to read as follows:
    § 165.13 Appeals.

    (a) Any Final Order of the Commission relating to a whistleblower award determination, including whether, to whom, or in what amount to make whistleblower awards, may be appealed to the appropriate court of appeals of the United States not more than 30 days after the Final Order of the Commission is issued, provided that administrative remedies have been exhausted.

    (b) The record on appeal shall consist of:

    (1) The Contents of Record for Award Determinations, as set forth in § 165.10. The record on appeal shall not include any pre-decisional or internal deliberative process materials that are prepared to assist the Commission or the Claims Review Staff in deciding the claim (including staff's draft Preliminary Determination or any Proposed Final Determination or staff's draft final determination); and

    (2) The Preliminary Determination and the Final Order of the Commission, as set forth in § 165.7.

    13. Revise § 165.15 to read as follows:
    § 165.15 Administering the whistleblower program.

    (a) Specific authorities—(1) Payments, deposits, and credits. The Executive Director is authorized to deposit into or credit collected monetary sanctions to the Fund, and to make payment of awards therefrom, with the concurrence of the General Counsel and the Director of the Division of Enforcement, or of their respective designees.

    (2) Designation of claims review staff. The Claims Review Staff referenced in § 165.7 shall be composed of no fewer than three and no more than five staff members from any of the Commission's Offices or Divisions (except the Office of General Counsel) who have not had direct involvement in the underlying enforcement action, as designated by the Director of the Division of Enforcement in consultation with the Executive Director. The Claims Review Staff will always include at least one staff member who does not work in the Division of Enforcement.

    (3) Disclosure of whistleblower identifying information. The Director of the Division of Enforcement is authorized on behalf of the Commission to exercise its discretion to disclose whistleblower identifying information under § 165.4(a).

    (b) General authority to administer the program. The Director of the Division of Enforcement shall have general authority to administer the whistleblower program except as otherwise provided under this part.

    14. Revise § 165.19 to read as follows:
    § 165.19 Nonenforceability of certain provisions waiving rights and remedies or requiring arbitration of disputes.

    (a) Non-waiver. The rights and remedies provided for in this part may not be waived by any agreement, policy, form, or condition of employment, including by a predispute arbitration agreement. No predispute arbitration agreement shall be valid or enforceable if the agreement requires arbitration of a dispute arising under this part.

    (b) Protected communications. No person may take any action to impede an individual from communicating directly with the Commission's staff about a possible violation of the Commodity Exchange Act, including by enforcing, or threatening to enforce, a confidentiality agreement or predispute arbitration agreement with respect to such communications.

    15. Add § 165.20 to read as follows:
    § 165.20 Whistleblower anti-retaliation protections.

    (a) In general. No employer may discharge, demote, suspend, directly or indirectly threaten or harass, or in any other manner discriminate against, a whistleblower in the terms and conditions of employment because of any lawful act done by the whistleblower—

    (1) In providing information to the Commission in accordance with this part; or

    (2) In assisting in any investigation or judicial or administrative action of the Commission based upon or related to such information.

    (b) Anti-retaliation enforcement. Section 23(h)(1)(A) of the Commodity Exchange Act (7 U.S.C. 26(h)(1)), including the rules in this part promulgated thereunder, shall be enforceable in an action or proceeding brought by the Commission including where retaliation is in response to a whistleblower providing information to the Commission after reporting the information through internal whistleblower, legal or compliance procedures.

    (c) Protections apply regardless of non-qualification. The anti-retaliation protections apply whether or not the whistleblower satisfies the requirements, procedures, and conditions to qualify for an award.

    16. Revise appendix A to part 165 to read as follows: Appendix A to Part 165—Guidance With Respect to the Protection of Whistleblowers Against Retaliation

    (a) In general. Section 23(h)(1) of Commodity Exchange Act prohibits employers from engaging in retaliation against whistleblowers. A violation of this provision could be addressed by a Commission enforcement action, or a lawsuit by an individual. Section 23(h)(1)(B) provides for a federal cause of action brought by the whistleblower against the employer, which must be filed in the appropriate district court of the United States within two (2) years of the employer's retaliatory act, and potential relief for prevailing whistleblowers, including reinstatement, back pay, and compensation for other expenses, including reasonable attorney's fees.

    (b) Enforcement—(1) Private cause of action. (i) An individual who alleges discharge, demotion, suspension, direct or indirect threats or harassment, or any other manner of discrimination in violation of section 23(h)(1)(A) of the Commodity Exchange Act may bring an action under section 23(h)(1)(B) of the Commodity Exchange Act in the appropriate district court of the United States for the relief provided in section 23(h)(1)(C) of the Commodity Exchange Act, unless the individual who is alleging discharge or other discrimination in violation of section 23(h)(1)(A) of the Commodity Exchange Act is an employee of the Federal Government, in which case the individual shall only bring an action under section 1221 of title 5, United States Code.

    (ii) Subpoenas. A subpoena requiring the attendance of a witness at a trial or hearing conducted under section 23(h)(1)(B)(ii) of the Commodity Exchange Act may be served at any place in the United States.

    (iii) Statute of limitations. A private cause of action under section 23(h)(1)(B) of the Commodity Exchange Act may not be brought more than 2 years after the date on which the violation reported in section 23(h)(1)(A) of the Commodity Exchange Act is committed.

    (iv) Relief. Relief for an individual prevailing in an action brought under section 23(h)(1)(B) of the Commodity Exchange Act shall include—

    (A) Reinstatement with the same seniority status that the individual would have had, but for the discrimination;

    (B) The amount of back pay otherwise owed to the individual, with interest; and

    (C) Compensation for any special damages sustained as a result of the discharge or discrimination, including litigation costs, expert witness fees, and reasonable attorney's fees.

    (2) Commission authority to bring action. The Commission may bring an enforcement action against an employer that retaliates against a whistleblower by discharge, demotion, suspension, direct or indirect threats or harassment, or any other manner of discrimination.

    17. Add appendix B to part 165 to read as follows: Appendix B to Part 165—Form TCR and Form WP-APP ER30MY17.017 ER30MY17.018 ER30MY17.019 ER30MY17.020 ER30MY17.021 ER30MY17.022 ER30MY17.023 ER30MY17.024 ER30MY17.025 ER30MY17.026 ER30MY17.027 ER30MY17.028 Submission Procedures

    Questions concerning this form may be directed to Commodity Futures Trading Commission, Whistleblower Office, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581.

    • If you are submitting information for the CFTC's whistleblower award program, you must submit your information using this Form TCR.

    • You may submit this form electronically, through the Web portal found on the CFTC's Web site at http://www.whistleblower.gov. You may also print this form and submit it by mail to Commodity Futures Trading Commission, Whistleblower Office, Three Lafayette Centre, 1155 21st Street, NW., Washington, DC 20581, or by facsimile to (202) 418-5975.

    • You have the right to submit information anonymously. If you do not submit anonymously, please note that the CFTC is required by law to maintain the confidentiality of any information which could reasonably identify you, and will only reveal such information in limited and specifically-defined circumstances. See 7 U.S.C. 26(h)(2); 17 CFR 165.4. However, in order to receive a whistleblower award, you will need to be identified to select CFTC staff for a final eligibility determination, and in unusual circumstances, you may need to be identified publicly for trial. You should therefore provide some means for the CFTC's staff to contact you, such as a telephone number or an email address.

    Instructions for Completing Form TCR General

    All references to “you” and “your” are intended to mean the complainant.

    Section A: Tell Us About Yourself

    Questions 1-14: Please provide the following information about yourself:

    ☐ last name, first name and middle initial; ☐ complete address, including city, state and zip code; ☐ telephone number and, if available, an alternate number where you can be reached; ☐ your email address (to facilitate communications, we strongly encourage you to provide an email address, especially if you are filing anonymously); ☐ your preferred method of communication; and ☐ your occupation. Section B: Your Attorney's Information

    Complete this section only if you are represented by an attorney in this matter.

    Questions 1-10: Provide the following information about your attorney:

    ☐ attorney's name; ☐ firm name; ☐ complete address, including city, state and zip code; ☐ telephone number and fax number; and ☐ email address. Section C: Tell Us Who You Are Complaining About

    Question 1-2: Choose one of the following that best describes the individual's profession or the type of entity to which your complaint relates:

    For Individuals: accountant, analyst, associated person, attorney, auditor, broker, commodity trading advisor, commodity pool operator, compliance officer, employee, executing broker, executive officer or director, financial planner, floor broker, floor trader, trader, unknown or other (specify).

    For Entities: bank, commodity pool, commodity pool operator, commodity trading advisor, futures commission merchant, hedge fund, introducing broker, major swap participant, retail foreign exchange dealer, swap dealer, unknown or other (specify).

    Questions 3-12: For each individual and/or entity, provide the following information, if known: ☐ full name; ☐ complete address, including city, state and zip code; ☐ telephone number; ☐ email address; and ☐ internet address, if applicable.

    Questions 13: If the firm or individual you are complaining about has custody or control of your investment, identify whether you have had difficulty contacting that firm or individual.

    Question 14: Identify if you are, or were, associated with the individual or firm you are complaining about. If yes, describe how you are, or were, associated with the individual or firm you are complaining about.

    Question 15: Identify the initial form of contact between you and the person against whom you are filing this complaint.

    Section D: Tell Us About Your Complaint

    Question 1: State the date (mm/dd/yyyy) that the alleged conduct occurred or began.

    Question 2: Identify if the conduct is on-going.

    Question 3: Choose the option that you believe best describes the nature of your complaint. If you are alleging more than one violation, please list all that you believe may apply.

    Question 4: Select the type of product or instrument you are complaining about.

    Question 5: If applicable, please name the product or instrument. If yes, please describe.

    Question 6: Identify whether you have suffered a monetary loss. If yes, please describe.

    Question 7: Identify if the individual or firm you are complaining about acknowledged their fault.

    Question 8: Indicate whether you have taken any other action regarding your complaint, including whether you complained to the CFTC, another regulator, a law enforcement agency, or any other agency or organization, or initiated legal action, mediation, arbitration or any other action.

    If you answered yes, provide details, including the date on which you took the action(s) described, the name of the person or entity to whom you directed any report or complaint, and contact information for the person or entity, if known, and the complete case name, case number and forum of any legal action you have taken.

    Question 9: State in detail all facts pertinent to the alleged violation. Explain why you believe the facts described constitute a violation of the Commodity Exchange Act.

    Question 10: Describe all supporting materials in your possession and the availability and location of any additional supporting materials not in your possession.

    Section E: Whistleblower Program

    Question 1: Describe how you obtained the information that supports your allegations. If any information was obtained from an attorney or in a communication where an attorney was present, identify such information with as much particularity as possible. In addition, if any information was obtained from a public source, identify the source with as much particularity as possible.

    Question 2: Identify any documents or other information in your submission on this Form TCR that you believe could reasonably be expected to reveal your identity. Explain the basis for your belief that your identity would be revealed if the documents or information were disclosed to a third party.

    Question 3: State whether you or your attorney have had any prior communication(s) with the CFTC concerning this matter.

    If you answered “yes”, identify the CFTC staff member(s) with whom you or your attorney communicated.

    Question 4: Indicate whether you or your attorney have provided the information you are providing to the CFTC to any other agency or organization, or whether any other agency or organization has requested the information or related information from you.

    If you answered “yes”, provide details and the name and contact information of the point of contact at the other agency or organization, if known.

    Question 5: Indicate whether your complaint relates to an entity of which you are, or were in the past, an officer, director, counsel, employee, consultant or contractor.

    If you answered “yes”, state whether you have reported this violation to your supervisor, compliance office, whistleblower hotline, ombudsman, or any other available mechanism at the entity for reporting violations. Please provide details, including the date on which you took the action.

    Question 6: Indicate whether you have taken any other action regarding your complaint, including whether you complained to the CFTC, another regulator, a law enforcement agency, or any other agency or organization, or initiated legal action, mediation, arbitration or any other action.

    If you answered “yes”, provide details, including the date on which you took the action(s) described, the name of the person or entity to whom you directed any report or complaint, and contact information for the person or entity, if known, and the complete case name, case number and forum of any legal action you have taken.

    Question 7: Provide any additional information you think may be relevant.

    Section F: Whistleblower Eligibility Requirements and Other Information

    Question 1: State whether you are currently, or were at the time that you acquired the original information that you are submitting to the CFTC, a member, officer or employee of: The CFTC; the Board of Governors of the Federal Reserve System; the Office of the Comptroller of the Currency; the Board of Directors of the Federal Deposit Insurance Corporation; the Director of the Office of Thrift Supervision; the National Credit Union Administration Board; the Securities and Exchange Commission; the Department of Justice; a registered entity; a registered futures association; a self-regulatory organization (as defined in 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)); a law enforcement organization; or a foreign regulatory authority or law enforcement organization.

    Question 2: State whether you are providing the information pursuant to a cooperation agreement with the CFTC or with another agency or organization.

    Question 3: State whether you are providing this information before you (or anyone representing you) received any request, inquiry or demand that relates to the subject matter of this submission (i) from the CFTC, (ii) in connection with an investigation, inspection or examination by any registered entity, registered futures association or self-regulatory organization (as defined in 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)), or (iii) in connection with an investigation by the Congress, or any other federal or state authority.

    Question 4: State whether you are currently a subject or target of a criminal investigation, or whether you have been convicted of a criminal violation, in connection with the information you are submitting to the CFTC.

    Question 5: State whether you acquired the information you are providing to the CFTC from any individual described in Questions 1 through 4 of this section.

    Question 6: If you answered yes to any of Questions 1 through 5, please provide details.

    Section G: Privacy Notice and Whistleblower's Declaration

    You must sign this Declaration if you are submitting this information pursuant to the CFTC whistleblower program and wish to be considered for an award. If you are submitting your information using the electronic version of Form TCR through the CFTC's web portal, you must check the box to agree with the declaration. If you are submitting your information anonymously, you must still sign this Declaration (using the term “anonymous”) or check the box as appropriate, and, if you are represented by an attorney, you must provide your attorney with the original of this signed form, or maintain a copy for your own records.

    Section H: Counsel Certification

    If you are submitting this information pursuant to the CFTC whistleblower program and you are doing so anonymously through an attorney, your attorney must sign the Counsel Certification Section. If your attorney is submitting your information using the electronic version of Form TCR through the CFTC's web portal, he/she must check the box to agree with the certification. If you are represented in this matter but you are not submitting your information pursuant to the CFTC whistleblower program, your attorney does not need to sign this Certification or check the box.

    ER30MY17.029 ER30MY17.030 ER30MY17.031 ER30MY17.032 ER30MY17.033 Privacy Act Statement

    This notice is given under the Privacy Act of 1974. The Privacy Act requires that the Commodity Futures Trading Commission (CFTC) inform individuals of the following when asking for information. The solicitation of this information is authorized under the Commodity Exchange Act, 7 U.S.C. 1 et seq. The information provided will enable the CFTC to determine the whistleblower award claimant's eligibility for payment of an award pursuant to Section 23 of the Commodity Exchange Act and Part 165 of the CFTC's regulations. This information will be used to investigate and prosecute violations of the Commodity Exchange Act and the CFTC's regulations. This information may be disclosed to federal, state, local or foreign agencies or other authorities responsible for investigating, prosecuting, enforcing or implementing laws, rules or regulations implicated by the information consistent with the confidentiality requirements set forth in Section 23 of the Commodity Exchange Act and Part 165 of the CFTC's regulations. The information will be maintained and additional disclosures may be made in accordance with System of Records Notices CFTC-49, “Whistleblower Records” (exempted), CFTC-10, “Investigatory Records” (exempted), and CFTC-16, “Enforcement Case Files.” The CFTC requests the last four digits of the claimant's Social Security Number for use as an individual identifier to administer and manage the whistleblower award program. Executive Order 9397 (November 22, 1943) allows federal agencies to use the Social Security Number as an individual identifier. Furnishing the information is voluntary. However, if an individual is providing information for the whistleblower award program, not providing required information may result in the individual not being eligible for award consideration.

    Questions concerning this form may be directed to Commodity Futures Trading Commission, Whistleblower Office, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581.

    Submission Procedures

    • This form must be used by persons making a claim for a whistleblower award in connection with information provided to the CFTC, or to another agency or organization in a related action. In order to be deemed eligible for an award, you must meet all the requirements set forth in Section 23 of the Commodity Exchange Act and Part 165 of the CFTC's regulations.

    • You must sign the Form WB-APP as the claimant. If you wish to submit the Form WB-APP anonymously, you must do so through an attorney, your attorney must sign the Counsel Certification Section of the Form WB-APP that is submitted to the CFTC, and you must give your attorney your original signed Form WB-APP so that it can be produced to the CFTC upon request.

    • During the whistleblower award claim process, your identity must be verified in a form and manner that is acceptable to the CFTC prior to the payment of any award.

    ○ If you are filing your claim in connection with information that you provided to the CFTC, then your Form WB-APP, and any attachments thereto, must be received by the CFTC within ninety (90) days of the date of the Notice of Covered Action, or the date of a final judgment in a related action to which the claim relates.

    ○ If you are filing your claim in connection with information that you provided to another agency or organization in a related action, then your Form WB-APP, and any attachments thereto, must be received by the CFTC as follows:

    • If a final order imposing monetary sanctions has been entered in a related action at the time that you submit your claim for an award in connection with a CFTC action, you may submit your claim for an award in that related action on the same Form WB-APP that you use for the CFTC action.

    • If a final order imposing monetary sanctions in a related action has not been entered at the time that you submit your claim for an award in connection with a CFTC action, you must submit your claim on Form WB-APP within ninety (90) days of the issuance of a final order imposing sanctions in the related action.

    • If a final order imposing monetary sanctions in a related action relates to a judicial or administrative action brought by the Commission under the Commodity Exchange Act that is not a covered judicial or administrative action, and therefore there would not be a Notice of Covered Action, you must submit your claim on Form WB-APP for an award in connection with the related action within ninety (90) calendar days following either (1) the date of issuance of a final order in the related action, if that date is after the date of issuance of the final judgment in the related Commission judicial or administrative action; or (2) the date of issuance of the final judgment in the related Commission judicial or administrative action, i.e., the date the related action becomes a related action, if the date of issuance of the final order in the related action precedes the final judgment in the related Commission judicial or administrative action.

    • To submit your Form WB-APP, you may print it and either submit it by mail to Commodity Futures Trading Commission, Whistleblower Office, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581, or by facsimile to (202) 418-5975. You also may submit this form electronically, through the web portal found on the CFTC's Web site at http://www.cftc.gov, which is also accessible from the CFTC Whistleblower Program Web site at www.whistleblower.gov.

    Instructions for Completing Form WB-APP General

    All references to “you” and “your” are intended to mean the whistleblower award claimant.

    Section A: Tell Us About Yourself Questions 1-3: Please provide the following information about yourself: • last name, first name, middle initial and the last four digits of your Social Security Number; • complete address, including city, state and zip code; • telephone number and, if available, an alternate number where you can be reached; and • your email address (to facilitate communications, we strongly encourage you to provide an email address, especially if you are making your claim anonymously). Section B: Your Attorney's Information

    Complete this section only if you are represented by an attorney in this matter. Questions 1-4: Provide the following information about your attorney:

    • attorney's name; • firm name; • complete address, including city, state and zip code; • telephone number and fax number; and • email address. Section C: Tell Us About Your Tip or Complaint

    Question 1a: Indicate the manner in which you submitted your original information to the CFTC.

    Question 1b: Provide the date on which you submitted your original information to the CFTC.

    Question 2a: State whether you filed a CFTC Form TCR.

    Question 2b: If you filed a CFTC Form TCR, provide the Form's number.

    Question 2c: If you filed a CFTC Form TCR, provide the date on which you filed the Form.

    Question 3: Provide the name(s) of the individual(s) and/or entity(s) to which your tip or complaint relates.

    Section D: Notice of Covered Action

    The process for making a claim for a whistleblower award for a CFTC action begins with the publication of a “Notice of Covered Action” on the CFTC's Web site. This Notice is published whenever a judicial or administrative action brought by the CFTC results in the imposition of monetary sanctions exceeding $1,000,000. The Notice is published on the CFTC's Web site subsequent to the entry of a final judgment or order in the action that by itself, or collectively with other judgments or orders previously entered in the action, exceeds the $1,000,000 threshold required for a whistleblower to be potentially eligible for an award. The CFTC will not contact whistleblower claimants directly as to Notices of Covered Actions; prospective claimants should monitor the CFTC Web site for such Notices.

    Question 1: Provide the date of the Notice of Covered Action to which this claim relates.

    Question 2: Provide the notice number of the Notice of Covered Action.

    Question 3a: Provide the case name referenced in the Notice of Covered Action.

    Question 3b: Provide the case number referenced in the Notice of Covered Action.

    Section E: Claims Pertaining to Related Actions

    Question 1: Provide the name of the agency or organization to which you provided your information.

    Question 2: Provide the name and contact information for your point of contact at the agency or organization, if known.

    Question 3a: Provide the date on which you provided your information to the agency or organization referenced in Question 1 of this section.

    Question 3b: Provide the date on which the agency or organization referenced in Question 1 of this section filed the related action that was based upon the information that you provided.

    Question 4a: Provide the case name of the related action.

    Question 4b: Provide the case number of the related action.

    Section F: Eligibility Requirements and Other Information

    Question 1: State whether you are currently, or were at the time that you acquired the original information that you submitted to the CFTC, a member, officer or employee of: The CFTC; the Board of Governors of the Federal Reserve System; the Office of the Comptroller of the Currency; the Board of Directors of the Federal Deposit Insurance Corporation; the Director of the Office of Thrift Supervision; the National Credit Union Administration Board; the Securities and Exchange Commission; the Department of Justice; a registered entity; a registered futures association; a self-regulatory organization; a law enforcement organization; or a foreign regulatory authority or law enforcement organization.

    Question 2: State whether you provided the information that you submitted to the CFTC pursuant to a cooperation agreement with the CFTC, or with any other agency or organization.

    Question 3: State whether you provided this information before you (or anyone representing you) received any request, inquiry or demand that relates to the subject matter of your submission (i) from the CFTC, (ii) in connection with an investigation, inspection or examination by any registered entity, registered futures association or self-regulatory organization, or (iii) in connection with an investigation by the Congress, or any other federal or state authority.

    Question 4: State whether you are currently a subject or target of a criminal investigation, or whether you have been convicted of a criminal violation, in connection with the information that you submitted to the CFTC and upon which your application for an award is based.

    Question 5: State whether you acquired the information that you provided to the CFTC from any individual described in Questions 1 through 4 of this section.

    Question 6: If you answered yes to any of Questions 1 through 5 of this section, please provide details.

    Section G: Entitlement to Award

    This section is optional. Use this section to explain the basis for your belief that you are entitled to an award in connection with your submission of information to the CFTC, or to another agency in connection with a related action. Specifically, address why you believe that you voluntarily provided the CFTC with original information that led to the successful enforcement of a judicial or administrative action filed by the CFTC, or a related action. Refer to § 165.9 of the CFTC's regulations for further information concerning the relevant award criteria.

    Section 23(c)(1)(B) of the Commodity Exchange Act and § 165.9(a) of the CFTC's regulations require the CFTC to consider the following factors in determining the amount of an award: (1) The significance of the information provided by a whistleblower to the success of the CFTC action or related action; (2) the degree of assistance provided by the whistleblower and any legal representative of the whistleblower in the CFTC action or related action; (3) the programmatic interest of the CFTC in deterring violations of the Commodity Exchange Act (including regulations under the Act) by making awards to whistleblowers who provide information that leads to the successful enforcement of such laws; (4) whether the award otherwise enhances the CFTC's ability to enforce the Commodity Exchange Act, protect customers, and encourage the submission of high quality information from whistleblowers; and (5) potential adverse incentives from oversize awards. Address these factors in your response as well.

    Section H: Claimant's Declaration

    You must sign this Declaration if you are submitting this claim pursuant to the CFTC whistleblower program and wish to be considered for an award. If you are submitting your claim anonymously, you must do so through an attorney, and you must provide your attorney with your original signed Form WB-APP.

    Section I: Counsel Certification

    If you are submitting this claim pursuant to the CFTC whistleblower program anonymously, you must do so through an attorney, and your attorney must sign the Counsel Certification Section.

    Issued in Washington, DC, on May 22, 2017, by the Commission. Christopher J. Kirkpatrick, Secretary of the Commission. Note:

    The following appendix will not appear in the Code of Federal Regulations.

    Appendix to Whistleblower Awards Process—Commission Voting Summary

    On this matter, Acting Chairman Giancarlo and Commissioner Bowen voted in the affirmative. No Commissioner voted in the negative.

    [FR Doc. 2017-10801 Filed 5-26-17; 8:45 am] BILLING CODE 6351-01-P
    DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 24 CFR Parts 28, 30, 87, 180, and 3282 [Docket No. FR-5942-F-02] RIN 2501-AD79 Inflation Catch-Up Adjustment of Civil Monetary Penalty Amounts Final Rule and Adjustment of Civil Monetary Penalty Amounts for 2017 AGENCY:

    Office of the General Counsel, HUD.

    ACTION:

    Final rule.

    SUMMARY:

    This rule makes final the interim final rule, published on June 15, 2016, to amend HUD's civil monetary penalty (CMP) regulations. The interim final rule applied a new methodology to calculate civil money penalties as mandated by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, starting with a “catch up” adjustment to correct previous inaccuracies; removed three obsolete civil monetary penalty provisions; and made a technical change to the existing codified regulation implementing the Program Fraud Civil Remedies Act. The changes from the interim final rule made final by this final rule continue to be effective as of August 16, 2016.

    In addition, this rule provides for 2017 inflation adjustments of civil monetary penalty amounts required by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, and makes three technical amendments and a conforming statutory change.

    DATES:

    Effective date: June 29, 2017.

    Applicability date: The applicability date for catch-up adjustment was August 16, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Dane Narode, Associate General Counsel, Office of Program Enforcement, Department of Housing and Urban Development, 1250 Maryland Avenue SW., Suite 200, Washington, DC 20024; telephone number 202-245-4141 (this is not a toll-free number). Hearing- or speech-impaired individuals may access this number via TTY by calling the Federal Information Relay Service, toll-free, at 800-877-8339.

    SUPPLEMENTARY INFORMATION:

    I. Background A. The June 15, 2016, Interim Rule

    The Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act) (Pub. L. 114-74) amended the Federal Civil Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461 note) requiring all Federal agencies to issue an interim final rule implementing changes to their civil money penalties. On June 15, 2016, pursuant to the requirements of the 2015 Act, HUD published an interim final rule for public comment, entitled “Inflation Catch-Up Adjustment of Civil Monetary Penalty Amounts” (81 FR 38931). The 2015 Act required agencies to make an initial catch-up adjustment by interim final rule, using a new methodology designed to correct inaccuracies in the previous method of computing inflation adjustments. In order to address these inaccuracies, the 2015 Act excluded adjustments made under the law prior to its amendment, and it provided that the initial catch-up adjustment was the percentage by which the Consumer Price Index (CPI) for the month of October 2015 exceeded that of the month of October of the calendar year during which the amount of the CMP was originally established or otherwise adjusted under a provision of law other than the Federal Civil Money Penalties Inflation Adjustment Act of 1990. Increases in the initial catch-up adjustment were capped at 150 percent of the amount of the CMP in effect as of the date of enactment of the 2015 Act.

    The interim final rule established the new adjusted penalty amount for each provision under which HUD is authorized to assess a CMP (81 FR 38935-38936); removed the obsolete CMP provisions that were codified at 24 CFR 30.30, 30.55, and 30.69 (81 FR 38935); and made a correction to 24 CFR 28.10 to include liability for causing a false claim or statement to be made, in addition to liability for making a false claim or statement (81 FR 38935).

    The public comment period for the interim final rule closed on August 15, 2016. The interim final rule became effective on August 16, 2016. The August 16, 2016, effective date for the amendments made by the interim final rule is unchanged. HUD received one comment in response to the interim final rule, but it was not actually relevant to any issue in the interim final rule.1

    1 The comment is available for public inspection at: https://www.regulations.gov/docket?D=HUD-2016-0062.

    B. This 2017 Inflation Adjustment

    After the catch-up adjustment, the 2015 Act requires agencies to make subsequent annual adjustments for inflation “notwithstanding section 553 of title 5, United States Code.” Section 553 refers to the Administrative Procedure Act, which might otherwise require a delay for advance notice and opportunity for public comment on future annual inflation adjustments. The first of these subsequent adjustments is for 2017.

    The annual adjustment is based on the percent change between the U.S. Department of Labor's Consumer Price Index for All Urban Consumers (“CPI-U”) for the month of October preceding the date of the adjustment, and the CPI-U for October of the prior year (28 U.S.C. 2461 note, section (5)(b)(1)). Based on that formula, the cost-of-living adjustment multiplier for 2017 is 1.01636.2 Pursuant to the 2015 Act, adjustments are rounded to the nearest dollar.3

    2 Office of Management and Budget, M-17-11, Memorandum for the Heads of Executive Departments and Agencies, Implementation of the 2017 annual adjustment pursuant to the Federal Civil Penalties Inflation Adjustment Act. (https://obamawhitehouse.archives.gov/sites/default/files/omb/memoranda/2017/m-17-11_0.pdf). (October 2016 CPI-U (241.729) − October 2015 CPI-U (237.838) = 1.01636.)

    3 28 U.S.C. 2461 note.

    II. This Final Rule

    This rule makes final the June 15, 2016, interim rule. In addition, this rule makes the required 2017 inflation adjustment. Since HUD is not applying these adjustments retroactively, the 2016 increases being finalized apply to violations occurring prior to the effective date of this final rule (and on and after the effective date of the 2016 interim rule) and the 2017 increases apply to violations occurring on or after this rule's effective date.

    Along with the 2017 inflation adjustment in this final rule, HUD also makes conforming and technical amendments to §§ 30.5, 30.10, 30.35, 30.36, and 30.80. Specifically, references to the former mortgage assignment procedures (in § 30.35), Urban Homesteading program (in §§ 30.5 and 30.80), and the Loan Correspondent program (in § 30.36) are removed, as those programs have been ended and are no longer active. In addition, the Helping Families Save Their Homes Act of 2009 (Pub. L. 111-22) amended the HUD Reform Act of 1989 (12 U.S.C. 1735f-14(a)(2)) definition for “knowing or knowingly” as it applies to civil money penalties against mortgagees, lenders, and other participants in FHA programs. This rule amends the definition for “knowing or knowingly” in § 30.10 to include the 2009 statutory definition.

    For each component, HUD provides a table showing how the penalties are being adjusted for 2017 pursuant to the 2015 Act. In the first column, HUD provides a description of the penalty. In the second column (“Statutory Citation,”) HUD provides the United States Code statutory citation providing for the penalty. In the third column (“Regulatory citation”), HUD provides the Code of Federal Regulations citation under title 24 for the penalty. In the fourth column (“Previous Amount”), HUD provides the amount of the penalty pursuant to the interim rule implementing the “catch-up” adjustment (81 FR 38931, June 15, 2016). In the fifth column, (“2017 Adjusted Amount”) HUD lists the penalty after applying the 2017 inflation adjustment.

    Description Statutory citation Regulatory
  • citation
  • (24 CFR)
  • Previous amount 2017 Adjusted
  • amount
  • False Claims & Statements Omnibus Budget Reconciliation Act of 1986 (31 U.S.C. 3802(a)(1)) § 28.10 $10,781 $10,957 Advance Disclosure of Funding Department of Housing and Urban Development Act (42 U.S.C. 3537a(c)) § 30.20 $18,936 $19,246 Disclosure of Subsidy Layering Department of Housing and Urban Development Act (42 U.S.C. 3545(f)) § 30.25 $18,936 $19,246 FHA Mortgagees and Lenders Violations HUD Reform Act of 1989 (12 U.S.C. 1735f-14(a)(2)) § 30.35 Per Violation: $9,468 Per Year: $1,893,610 Per Violation: $9,623 Per Year: $1,924,589 Other FHA Participants Violations HUD Reform Act of 1989 (12 U.S.C. 1735f-14(a)(2)) § 30.36 Per Violation: $9,468 Per Year: $1,893,610 Per Violation: $9,623 Per Year: $1,924,589 Indian Loan Mortgagees Violations Housing Community Development Act of 1992 (12 U.S.C. 1715z-13a(g)(2)) § 30.40 Per Violation: $9,468 Per Year: $1,893,610 Per Violation: $9,623 Per Year: $1,924,589 Multifamily & Section 202 or 811 Owners Violations HUD Reform Act of 1989 (12 U.S.C. 1735f-15(c)(2)) § 30.45 $47,340 $48,114 Ginnie Mae Issuers & Custodians Violations HUD Reform Act of 1989 (12 U.S.C. 1723i(b)) § 30.50 Per Violation: $9,468 Per Year: $1,893,610 Per Violation: $9,623 Per Year: $1,924,589 Title I Broker & Dealers Violations HUD Reform Act of 1989 (12 U.S.C. 1703) § 30.60 Per Violation: $9,468 Per Year: $1,893,610 Per Violation: $9,623 Per Year: $1,924,589 Lead Disclosure Violation Title X—Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C. 4852d(b)(1)) § 30.65 $16,773 $17,047 Section 8 Owners Violations Multifamily Assisted Housing Reform and Affordability Act of 1997 (42 U.S.C. 1437z-1(b)(2)) § 30.68 $36,794 $37,396 Lobbying Violation The Lobbying Disclosure Act of 1995 (31 U.S.C. 1352) § 87.400 Min: $18,936 Max: $189,361 Min: $19,246 Max: $192,459 Fair Housing Act Civil Penalties Fair Housing Amendments Act of 1988 (42 U.S.C. 3612(g)(3)) § 180.671(a) No Priors: $19,787 One Prior: $49,467 Two or More Priors: $98,935 No Priors: $20,111 One Prior: $50,276 Two or More Priors: $100,554 Manufactured Housing Regulations Violation Housing Community Development Act of 1974 (42 U.S.C. 5410) § 3282.10 Per Violation: $2,750 Per Year: $3,437,500 Per Violation: $2,795 Per Year: $3,493,738
    III. Justification for Final Rulemaking for the 2017 Adjustments

    HUD generally publishes regulations for public comment before issuing a rule for effect, in accordance with its own regulations on rulemaking in 24 CFR part 10. However, part 10 provides for exceptions to the general rule if the agency finds good cause to omit advanced notice and public participation. The good cause requirement is satisfied when prior public procedure is “impractical, unnecessary, or contrary to the public interest” (see 24 CFR 10.1). As discussed, this final rule adopts without change the amendments offered for public comment in the June 15, 2106, interim final rule. In addition, this rule makes the required 2017 inflation adjustment, which HUD does not have discretion to change. Moreover, the 2015 Act specifies that a delay in the effective date under the Administrative Procedure Act is not required for subsequent annual adjustments under the 2015 Act. HUD has determined, therefore, that it is unnecessary to delay the effectiveness of the 2017 inflation adjustments to solicit prior public comments.

    As discussed in the preamble to the June 15, 2016, interim final rule, section 7(o) of the Department of Housing and Urban Development Act (42 U.S.C. 3535(o)) requires that any HUD regulation implementing any provision of the Department of Housing and Urban Development Reform Act of 1989 that authorizes the imposition of a civil money penalty may not become effective until after the expiration of a public comment period of not less than 60 days. HUD met this separate 60-day delay requirement for implementing civil money penalties when HUD implemented the new 2015 Act penalty calculation in its June 16, 2016, interim final rule.

    Moreover, and as noted above, the 2017 inflation adjustments are made in accordance with a statutorily prescribed formula that does not provide for agency discretion. Accordingly, a delay in the effectiveness of the 2017 inflation adjustments in order to provide the public with an opportunity to comment is unnecessary because the 2015 Act exempts the adjustments from the need for delay and, in any event, HUD would not have the discretion to make changes as a result of any comments.

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

    Under Executive Order 12866 (Regulatory Planning and Review), a determination must be made whether a regulatory action is significant and, therefore, subject to review by the Office of Management and Budget (OMB) in accordance with the requirements of the order. Executive Order 13563 (Improving Regulations and Regulatory Review) directs executive agencies to analyze regulations that are “outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned. Executive Order 13563 also directs that, where relevant, feasible, and consistent with regulatory objectives, and to the extent permitted by law, agencies are to identify and consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public. As discussed above in this preamble, this final rule adjusts existing civil monetary penalties for inflation by a statutorily required amount.

    As a result of this review, OMB determined that this rule was not significant under Executive Order 12866 and Executive Order 13563.

    Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Because HUD has determined that good cause exists to issue this rule without prior public comment, this rule is not subject to the requirement to publish an initial or final regulatory flexibility analysis under the RFA as part of such action.

    Unfunded Mandates Reform

    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA) 4 requires that an agency prepare a budgetary impact statement before promulgating a rule that includes a Federal mandate that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year. If a budgetary impact statement is required, section 205 of UMRA also requires an agency to identity and consider a reasonable number of regulatory alternatives before promulgating a rule.5 However, the UMRA applies only to rules for which an agency publishes a general notice of proposed rulemaking. As discussed above, HUD has determined, for good cause, that prior notice and public comment is not required on this rule and, therefore, the UMRA does not apply to this final rule.

    4 2 U.S.C. 1532.

    5 2 U.S.C. 1534.

    Executive Order 13132, Federalism

    Executive Order 13132 (entitled “Federalism”) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial direct compliance costs on State and local governments and is not required by statute, or the rule preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive Order. This rule will not have federalism implications and would not impose substantial direct compliance costs on State and local governments or preempt State law within the meaning of the Executive order.

    Environmental Review

    This interim final rule does not direct, provide for assistance or loan and mortgage insurance for, or otherwise govern, or regulate, real property acquisition, disposition, leasing, rehabilitation, alteration, demolition, or new construction, or establish, revise, or provide for standards for construction or construction materials, manufactured housing, or occupancy. Accordingly, under 24 CFR 50.19(c)(1), this final rule is categorically excluded from environmental review under the National Environmental Policy Act of 1969 (42 U.S.C. 4321).

    List of Subjects 24 CFR Part 28

    Administrative practice and procedure, Claims, Fraud, Penalties.

    24 CFR Part 30

    Administrative practice and procedure, Grant programs—housing and community development, Loan programs—housing and community development, Mortgage insurance, Penalties.

    24 CFR Part 87

    Government contracts, Grant programs, Loan programs, Lobbying, Penalties, Reporting and recordkeeping requirements.

    24 CFR Part 180

    Administrative practice and procedure, Aged, Civil rights, Fair housing, Individuals with disabilities, Investigations, Mortgages, Penalties, Reporting and recordkeeping requirements.

    24 CFR Part 3282

    Administrative practice and procedure, Consumer protection, Intergovernmental relations, Manufactured homes, Reporting and recordkeeping requirements.

    Accordingly, for the reasons described in the preamble, HUD adopts as final the interim final rule published on June 15, 2016, at 81 FR 38931, and further amends 24 CFR parts 28, 30, 87, 180, and 3282 as follows:

    PART 28—IMPLEMENTATION OF THE PROGRAM FRAUD CIVIL REMEDIES ACT OF 1986 1. The authority citation for part 28 continues to read as follows: Authority:

    28 U.S.C. 2461 note; 31 U.S.C. 3801-3812; 42 U.S.C. 3535(d).

    2. In § 28.10, revise the introductory text of paragraphs (a)(1) and (b)(1), to read as follows:
    § 28.10 Basis for civil penalties and assessments.

    (a) * * *

    (1) A civil penalty of not more than $10,957 may be imposed upon any person who makes, presents, or submits, or causes to be made, presented, or submitted, a claim that the person knows or has reason to know:

    (b) * * *

    (1) A civil penalty of not more than $10,957 may be imposed upon any person who makes, presents, or submits, or causes to be made, presented, or submitted, a written statement that:

    PART 30—CIVIL MONEY PENALTIES: CERTAIN PROHIBITED CONDUCT 3. The authority citation for part 30 continues to read as follows: Authority:

    12 U.S.C. 1701q-1, 1703, 1723i, 1735f-14, and 1735f-15; 15 U.S.C. 1717a; 28 U.S.C. 1 note and 2461 note; 42 U.S.C. 1437z-1 and 3535(d).

    § 30.5 [Amended]
    4. In § 30.5, remove paragraph (c) and redesignate paragraphs (d), (e), and (f) as paragraphs (c), (d), and (e), respectively.
    § 30.10 [Amended]
    5. In § 30.10, add at the end of the definition of “Knowing or Knowingly” the sentence “For purposes of §§ 30.35 and 30.36, knowing or knowingly is defined at 12 U.S.C. 1735f-14(g).” 6. In § 30.20, revise paragraph (b) to read as follows:
    § 30.20 Ethical violations by HUD employees.

    (b) Maximum penalty. The maximum penalty is $19,246 for each violation.

    7. In § 30.25, revise paragraph (b) to read as follows:
    § 30.25 Violations by applicants for assistance.

    (b) Maximum penalty. The maximum penalty is $19,246 for each violation.

    8. In § 30.35, remove the words “§§ 203.650 through 203.664” in paragraph (a)(7) and add in their place “§ 203.664”; and revise the first sentence in paragraph (c)(1) to read as follows:
    § 30.35 Mortgagees and lenders.

    (c)(1) Amount of penalty. The maximum penalty is $9,623 for each violation, up to a limit of $1,924,589 for all violations committed during any one-year period. * * *

    9. In § 30.36, remove the words “or correspondent” in paragraph (b)(3) and revise the first sentence in paragraph (c) to read as follows:
    § 30.36 Other participants in FHA programs.

    (c) Amount of penalty. The maximum penalty is $9,623 for each violation, up to a limit of $1,924,589 for all violations committed during any one-year period. * * *

    10. In § 30.40, revise the first sentence in paragraph (c) to read as follows:
    § 30.40 Loan guarantees for Indian housing.

    (c) Amount of penalty. The maximum penalty is $9,623 for each violation, up to a limit of $1,924,589 for all violations committed during any one-year period. * * *

    11. In § 30.45, revise paragraph (g) to read as follows:
    § 30.45 Multifamily and section 202 or 811 mortgagors.

    (g) Maximum penalty. The maximum penalty for each violation under paragraphs (c) and (f) of this section is $48,114.

    12. In § 30.50, revise the first sentence in paragraph (c) to read as follows:
    § 30.50 GNMA issuers and custodians.

    (c) Amount of penalty. The maximum penalty is $9,623 for each violation, up to a limit of $1,924,589 during any one-year period. * * *

    13. In § 30.60, revise paragraph (c) to read as follows:
    § 30.60 Dealers or sponsored third-party originators.

    (c) Amount of penalty. The maximum penalty is $9,623 for each violation, up to a limit for any particular person of $1,924,589 during any one-year period.

    14. In § 30.65, revise paragraph (b) to read as follows:
    § 30.65 Failure to disclose lead-based paint hazards.

    (b) Amount of penalty. The maximum penalty is $17,047 for each violation.

    15. In § 30.68, revise paragraph (c) to read as follows:
    § 30.68 Section 8 owners.

    (c) Maximum penalty. The maximum penalty for each violation under this section is $37,396.

    § 30.80 [Amended]
    16. In § 30.80, add the word “and” after paragraph (h); remove paragraph (i); and redesignate paragraphs (j), (k), and (l) as paragraphs (i), (j), and (k), respectively. PART 87—NEW RESTRICTIONS ON LOBBYING 17. The authority citation for part 87 continues to read as follows: Authority:

    28 U.S.C. 1 note; 31 U.S.C. 1352; 42 U.S.C. 3535(d).

    18. In § 87.400, revise paragraphs (a), (b), and (e) to read as follows:
    § 87.400 Penalties.

    (a) Any person who makes an expenditure prohibited herein shall be subject to a civil penalty of not less than $19,246 and not more than $192,459 for each such expenditure.

    (b) Any person who fails to file or amend the disclosure form (see appendix B) to be filed or amended if required herein, shall be subject to a civil penalty of not less than $19,246 and not more than $192,459 for each such failure.

    (e) First offenders under paragraphs (a) or (b) of this section shall be subject to a civil penalty of $19,246, absent aggravating circumstances. Second and subsequent offenses by persons shall be subject to an appropriate civil penalty between $19,246 and $192,459, as determined by the agency head or his or her designee.

    PART 180—CONSOLIDATED HUD HEARING PROCEDURES FOR CIVIL RIGHTS MATTERS 19. The authority citation for part 180 continues to read as follows: Authority:

    28 U.S.C. 1 note; 29 U.S.C. 794; 42 U.S.C. 2000d-1, 3535(d), 3601-3619, 5301-5320, and 6103.

    20. In § 180.671, revise paragraphs (a)(1), (2), and (3) to read as follows:
    § 180.671 Assessing civil penalties for Fair Housing Act cases.

    (a) * * *

    (1) $20,111, if the respondent has not been adjudged in any administrative hearing or civil action permitted under the Fair Housing Act or any state or local fair housing law, or in any licensing or regulatory proceeding conducted by a federal, state, or local governmental agency, to have committed any prior discriminatory housing practice.

    (2) $50,276, if the respondent has been adjudged in any administrative hearing or civil action permitted under the Fair Housing Act, or under any state or local fair housing law, or in any licensing or regulatory proceeding conducted by a federal, state, or local government agency, to have committed one other discriminatory housing practice and the adjudication was made during the 5-year period preceding the date of filing of the charge.

    (3) $100,554, if the respondent has been adjudged in any administrative hearings or civil actions permitted under the Fair Housing Act, or under any state or local fair housing law, or in any licensing or regulatory proceeding conducted by a federal, state, or local government agency, to have committed two or more discriminatory housing practices and the adjudications were made during the 7-year period preceding the date of filing of the charge.

    PART 3282—MANUFACTURED HOME PROCEDURAL AND ENFORCEMENT REGULATIONS 21. The authority citation for part 3282 continues to read as follows: Authority:

    28 U.S.C. 1 note; 28 U.S.C. 2461 note; 42 U.S.C. 3535(d) and 5424.

    22. Revise § 3282.10 to read as follows:
    § 3282.10 Civil and criminal penalties.

    Failure to comply with these regulations may subject the party in question to the civil and criminal penalties provided for in section 611 of the Act, 42 U.S.C. 5410. The maximum amount of penalties imposed under section 611 of the Act shall be $2,795 for each violation, up to a maximum of $3,493,738 for any related series of violations occurring within one year from the date of the first violation.

    Dated: May 22, 2017. Bethany A. Zorc, Principal Deputy General Counsel.
    [FR Doc. 2017-11056 Filed 5-26-17; 8:45 am] BILLING CODE 4210-67-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2017-0408] RIN 1625-AA00 Safety Zone; Buffalo Carnival; Buffalo Outer Harbor, Buffalo, NY AGENCY:

    Coast Guard, DHS.

    ACTION:

    Temporary final rule.

    SUMMARY:

    The Coast Guard is establishing a temporary safety zone on Lake Erie, Buffalo Outer Harbor, Buffalo, NY. This safety zone is intended to restrict vessels from a portion of the Outer Harbor during the May 28, 2017 fireworks display. This temporary safety zone is necessary to protect mariners and vessels from the navigational hazards associated with a fireworks display.

    DATES:

    This rule is effective from 8:45 p.m. until 9:45 p.m. on May 28, 2017.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2017-0408 in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this rule.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions on this rule, call or email LT Michael Collet, Chief of Waterways Management, U.S. Coast Guard Sector Buffalo; telephone 716-843-9322, email [email protected]

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

    The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because doing so would be impracticable. The final details of this event were not known to the Coast Guard until there was insufficient time remaining before the event to publish an NPRM. 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 mariners and vessels from the hazards associated with a maritime fireworks display. Therefore, 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 Federal Register.

    III. Legal Authority and Need for Rule

    The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Buffalo (COTP) has determined that a maritime fireworks show presents significant risks to public safety and property. Such hazards include premature and accidental detonations, dangerous projectiles, and falling or burning debris. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while the fireworks show is taking place.

    IV. Discussion of the Rule

    This rule establishes a safety zone on May 28, 2017 from 8:45 p.m. until 9:45 p.m. The safety zone will encompass all waters of the Buffalo Outer Harbor contained within a 280-foot radius of position 42°52′10.75″ N. and 078°52′56.01″ W. (NAD 83).

    Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port Buffalo or his designated on-scene representative. The Captain of the Port or his designated on-scene representative may be contacted via VHF Channel 16.

    V. Regulatory Analyses

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

    A. Regulatory Planning and Review

    Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. Executive Order 13771 (“Reducing Regulation and Controlling Regulatory Costs”), directs agencies to reduce regulation and control regulatory costs and provides that “for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.”

    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.

    As this rule is not a significant regulatory action, this rule is exempt from the requirements of Executive Order 13771. See OMB's Memorandum titled “Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017 titled `Reducing Regulation and Controlling Regulatory Costs' ” (February 2, 2017).

    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 enforced for a relatively short time. Also, the safety zone is designed to minimize its impact on navigable waters. Furthermore, the safety zone has been designed to allow vessels to transit around it. Thus, restrictions on vessel movement within that particular area are expected to be minimal. Under certain conditions, moreover, vessels may still transit through the safety zone when permitted by the Captain of the Port.

    B. Impact on Small Entities

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

    This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons: This safety zone would be effective, and thus subject to enforcement for only one hour late in the evening. Traffic may be allowed to pass through the zone with the permission of the Captain of the Port. The Captain of the Port can be reached via VHF channel 16. Before the enforcement of the zone, we would issue local Broadcast Notice to Mariners.

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

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

    C. Collection of Information

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

    D. Federalism and Indian Tribal Governments

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

    Also, this rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

    E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

    F. Environment

    We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have determined that it is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule creates a temporary safety zone and is categorically excluded under section 2.B.2, figure 2-1, paragraph 34(g) of the Instruction, which pertains to establisnment of safety zones. A Record of Environmental Consideration (REC) supporting this determination is available in the docket where indicated in the ADDRESSES section of this preamble.

    G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

    List of Subjects in 33 CFR Part 165

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

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

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

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

    2. Add § 165.T09-0408 to read as follows:
    § 165.T09-0408 Safety Zone; Buffalo Carnival, Buffalo Outer Harbor; Buffalo, NY.

    (a) Location. This zone will encompass all waters of Buffalo Outer Harbor, Buffalo, NY contained within a 280-foot radius of position 42°52″10.76″ N. and 078°52′56.01″ W. (NAD 83).

    (b) Enforcement period. This rule is effective on May 28, 2017 from 8:45 p.m. until 9:45 p.m.

    (c) Regulations. (1) In accordance with the general regulations in § 165.23 of this part, entry into, transiting, or anchoring within this safety zone is prohibited unless authorized by the Captain of the Port Buffalo or his designated on-scene representative.

    (2) This safety zone is closed to all vessel traffic, except as may be permitted by the Captain of the Port Buffalo or his designated on-scene representative.

    (3) The “on-scene representative” of the Captain of the Port Buffalo is any Coast Guard commissioned, warrant or petty officer who has been designated by the Captain of the Port Buffalo to act on his behalf.

    (4) Vessel operators desiring to enter or operate within the safety zone must contact the Captain of the Port Buffalo or his on-scene representative to obtain permission to do so. The Captain of the Port Buffalo or his on-scene representative may be contacted via VHF Channel 16. Vessel operators given permission to enter or operate in the safety zone must comply with all directions given to them by the Captain of the Port Buffalo, or his on-scene representative.

    Dated: May 23, 2017. J.S. Dufresne, Captain, U.S. Coast Guard, Captain of the Port Buffalo.
    [FR Doc. 2017-11026 Filed 5-26-17; 8:45 am] BILLING CODE 9110-04-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R09-OAR-2016-0772; FRL-9962-82-Region 9] Determination of Attainment and Approval of Base Year Emissions Inventories for the Imperial County, California Fine Particulate Matter Nonattainment Area; Correction AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule; correcting amendment.

    SUMMARY:

    On March 13, 2017, the Environmental Protection Agency (EPA) published a direct final rule in the Federal Register determining that the Imperial County, California Moderate nonattainment area (“the Imperial County NA”) attained the 2006 24-hour fine particulate matter (PM2.5) national ambient air quality standard. In the same action, the EPA approved a revision to California's state implementation plan (SIP) consisting of the 2008 emissions inventory for the Imperial County NA submitted by the California Air Resources Board (CARB or “State”) on January 9, 2015. The EPA's description in regulatory text of the SIP element that was approved inadvertently included information unrelated to the 2008 emissions inventory. This document corrects the regulatory text to clarify the provisions of the SIP that are approved.

    DATES:

    This correcting amendment is effective on May 30, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Ginger Vagenas, EPA Region IX, (415) 972-3964, [email protected]

    SUPPLEMENTARY INFORMATION:

    This action corrects an inadvertent error in a rulemaking related to the EPA's approval of the 2008 emissions inventory for the Imperial County NA. On March 13, 2017, the EPA published a direct final rule approving a revision of the California SIP—specifically, we approved the portion of Chapter 3 of CARB's January 9, 2015 submittal that contains the 2008 emissions inventory for the Imperial County NA. This action contained amendatory instructions that added paragraph (484) to 40 CFR 52.220(c). However, in the amendatory instructions the EPA inadvertently failed to exclude Section 3.4.2 (“Determination of Significant Sources of PM2.5”) from the portions of the SIP we intended to approve. This document corrects that error.

    Correction

    In the direct final rule published in the Federal Register on March 13, 2017 (82 FR 13392), on page 13397, third column, in amendatory instruction 2, § 52.220(c)(484)(ii)(A)(1) should have listed Section 3.4.2 (“Determination of Significant Sources of PM2.5”) among the portions of Chapter 3 that the EPA was excluding from its approval.

    The EPA has determined that this action falls under the “good cause” exemption in section 553(b)(B) of the Administrative Procedure Act (APA) which, upon finding “good cause,” authorizes agencies to dispense with public participation where public notice and comment procedures are impracticable, unnecessary, or contrary to the public interest. Public notice and comment for this action are unnecessary because the underlying rule for which this correcting amendment has been prepared was already subject to a 30-day comment period. No comments were received. Further, this action, which corrects an inadvertent regulatory text error that was included in the EPA's March 13, 2017 direct final rule, is consistent with the substantive revision to the California SIP as described in the preamble of said action concerning the approval of the 2008 emissions inventory for the Imperial County NA. Because this correction action does not change the EPA's analysis or overall action related to the approval of the 2008 emissions inventory, no purpose would be served by additional public notice and comment. Consequently, additional public notice and comment are unnecessary.

    The EPA also finds that there is good cause under APA section 553(d)(3) for the correction in the amendatory instructions and related paragraph designation to become effective on the date of publication. Section 553(d)(3) of the APA allows an effective date less than 30 days after publication “as otherwise provided by the agency for good cause found and published with the rule.” 5 U.S.C. 553(d)(3). This rule does not create any new regulatory requirements such that affected parties would need time to prepare before the rule takes effect. This action merely corrects an inadvertent error in the regulatory text of the EPA's prior rulemaking for the California SIP. For these reasons, the EPA finds good cause under APA section 553(d)(3) for the correction to § 52.220(c)(484)(ii)(A)(1) to become effective on the date of publication of this final rule.

    Statutory and Executive Order Reviews

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). Because the agency has made a “good cause” finding that this action is not subject to notice-and-comment requirements under the Administrative Procedure Act or any other statute as indicated in the SUPPLEMENTARY INFORMATION section, above, it is not subject to the regulatory flexibility provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) or to sections 202 and 205 of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. L. 104-4). In addition, this action does not significantly or uniquely affect small governments or impose a significant intergovernmental mandate, as described in sections 203 and 204 of UMRA. This rule also 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, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified by Executive Order 13132 (64 FR 43255, August 10, 1999). This rule also is not subject to Executive Order 13045, “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it is not economically significant. In addition, this rule does not involve technical standards, thus the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This rule also does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. Section 808 allows the issuing agency to make a rule effective sooner than otherwise provided by the CRA if the agency makes a good cause finding that notice and public procedure is impracticable, unnecessary or contrary to the public interest. This determination must be supported by a brief statement. 5 U.S.C. 808(2). As stated previously, the EPA has made such a good cause finding, including the reasons therefore, and established an effective date of May 30, 2017. The EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Authority:

    42 U.S.C. 7401 et seq.

    Dated: May 4, 2017. Alexis Strauss, Acting Regional Administrator, Region IX.

    Accordingly, 40 CFR part 52 is corrected by making the following correcting amendment:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart F—California 2. Section 52.220 is amended by revising paragraph (c)(484)(ii)(A)(1) to read as follows:
    § 52.220 Identification of plan—in part.

    (c) * * *

    (484) * * *

    (ii) * * *

    (A) * * *

    (1) “Imperial County 2013 State Implementation Plan for the 2006 24-Hour PM2.5 Moderate Nonattainment Area,” adopted December 2, 2014, Chapter 3 (“Emissions Inventory”) excluding: Section 3.4.1 (“Determination of Significant Sources of PM2.5 Precursors”); Section 3.4.2 (“Determination of Significant Sources of PM2.5”); the 2011 and 2012 winter and annual average inventories in Table 3.1 (“PM2.5 Emissions Inventory by Major Source Category 2008, 2011 and 2012 Winter and Annual Planning Emissions Inventories”); the 2011 and 2012 winter and annual average inventories in Table 3.7 (“NOX Emissions Inventory by Major Source Category 2008, 2011 and 2012 Winter and Annual Planning Emissions Inventories”); the 2011 and 2012 winter and annual average inventories in Table 3.8 (“VOCs Emissions Inventory by Major Source Category 2008, 2011 and 2012 Winter and Annual Planning Emissions Inventories”); the 2011 and 2012 winter and annual average inventories in Table 3.9 (“SOX Emissions Inventory by Major Source Category 2008, 2011 and 2012 Winter and Annual Planning Emissions Inventories”); and the 2011 and 2012 winter and annual average inventories in Table 3.10 (“Ammonia Emissions Inventory by Major Source Category 2008, 2011 and 2012 Winter and Annual Planning Emissions Inventories”).

    [FR Doc. 2017-10931 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [DE104-1104; FRL-9961-26-Region 3] Approval and Promulgation of Air Quality Implementation Plans; Delaware; Update to Materials Incorporated by Reference AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule; administrative change.

    SUMMARY:

    The Environmental Protection Agency (EPA) is updating the materials that are incorporated by reference (IBR) into the Delaware state implementation plan (SIP). The regulations affected by this update have been previously submitted by the Delaware Department of Natural Resources and Environmental Control (DNREC) and approved by EPA. This update affects the SIP materials that are available for public inspection at the National Archives and Records Administration (NARA) and the EPA Regional Office.

    DATES:

    This action is effective May 30, 2017.

    ADDRESSES:

    SIP materials which are incorporated by reference into 40 CFR part 52 are available for inspection at the following locations: Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103; or NARA. For information on the availability of this material at NARA, call 202-741-6030, or go to: http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.

    FOR FURTHER INFORMATION CONTACT:

    Gavin Huang, (215) 814-2042 or by email at [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Background

    The SIP is a living document which a state revises as necessary to address its unique air pollution problems. Therefore, EPA, from time to time, must take action on SIP revisions containing new and/or revised regulations as being part of the SIP. On May 22, 1997 (62 FR 27968), EPA revised the procedures for incorporating by reference federally-approved SIPs, as a result of consultations between EPA and the Office of the Federal Register (OFR). The description of the revised SIP document, IBR procedures and “Identification of plan” format are discussed in further detail in the May 22, 1997 Federal Register document. On December 7, 1998 (63 FR 67407), EPA published a document in the Federal Register beginning the new IBR procedure for Delaware. On June 21, 2004 (69 FR 34285), April 3, 2007 (72 FR 15839), April 17, 2009 (74 FR 17771), and May 2, 2011 (76 FR 24372), September 24, 2013 (78 FR 58465), EPA published updates to the IBR material for Delaware. Since the publication of the last IBR update, EPA has approved regulatory changes to the following Delaware revised regulations:

    1. 7 DNREC regulation 1103 (Ambient Air Quality Standards), sections 1.0 (General Provisions), 4.0 (Sulfur Dioxide), 6.0 (Ozone), 8.0 (Nitrogen Dioxide), 10.0 (Lead), and 11.0 (PM10 and PM2.5 Particulates).

    2. 7 DNREC regulation 1140 (Delaware Low Emission Vehicle Program), sections 1.0 (Purpose), 2.0 (Applicability), 3.0 (Definitions), 4.0 (Emission Certification Standards), 5.0 (New Vehicle Emission Requirements), 6.0 (Manufacturer Fleet Requirements), 7.0 (Warranty), 8.0 (Reporting and Record-Keeping Requirements), 9.0 (Enforcement), 10.0 (Incorporation by Reference), 11.0 (Document Availability), and 12.0 (Severability).

    II. EPA Action

    In this action, EPA is announcing the update to the IBR material as of July 1, 2016 and revising the text within 40 CFR 52.420(b). EPA is revising our 40 CFR part 52 “Identification of Plan” for the State of Delaware regarding incorporation by reference, section 52.420(b). EPA is revising section 52.420(b)(1) to clarify that all SIP revisions listed in paragraphs (c) and (d), regardless of inclusion in the most recent “update to the SIP compilation,” are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking in which EPA approved the SIP revision, consistent with following our “Approval and Promulgations of Air Quality Implementation Plans; Revised Format of 40 CFR part 52 for Materials Being Incorporated by Reference,” effective May 22, 1997 (62 FR 27968). EPA is revising section 52.420(b)(2) to clarify references to other portions of paragraph (b) with subparagraph (b)(2). EPA is revising section (b)(3) to update address and contact information.

    III. Good Cause Exemption

    EPA has determined that this rule falls under the “good cause” exemption in section 553(b)(3)(B) of the Administrative Procedures Act (APA) which, upon finding “good cause,” authorizes agencies to dispense with public participation and section 553(d)(3) which allows an agency to make a rule effective immediately (thereby avoiding the 30-day delayed effective date otherwise provided for in the APA). This rule simply codifies provisions which are already in effect as a matter of law in federal and approved state programs. Under section 553 of the APA, an agency may find good cause where procedures are “impractical, unnecessary, or contrary to the public interest.” Public comment is “unnecessary” and “contrary to the public interest” since the codification only reflects existing law. Immediate notice in the CFR benefits the public by removing outdated citations and incorrect table entries.

    IV. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of previously EPA approved regulations promulgated by the State of Delaware and federally effective prior to July 1, 2016. Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.1 EPA has made, and will continue to make, these materials generally available through www.regulations.gov and/or at the EPA Region III Office (please contact the person identified in the “For Further Information Contact” section of this preamble for more information).

    1 62 FR 27968 (May 22, 1997).

    V. Statutory and Executive Order Reviews A. General Requirements

    Under the Clean Air Act (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 Order 12866 (58 FR 51735, October 4, 1993);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

    B. Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This rule is not a “major rule” as defined by 5 U.S.C. 804(2).

    C. Petitions for Judicial Review

    EPA has also determined that the provisions of section 307(b)(1) of the CAA pertaining to petitions for judicial review are not applicable to this action. Prior EPA rulemaking actions for each individual component of the Delaware SIP compilations had previously afforded interested parties the opportunity to file a petition for judicial review in the United States Court of Appeals for the appropriate circuit within 60 days of such rulemaking action. Thus, EPA sees no need in this action to reopen the 60-day period for filing such petitions for judicial review for this “Identification of Plan” update action for Delaware.

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: March 23, 2017. Cecil Rodrigues, Acting Regional Administrator, Region III.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart I—Delaware
    2. Section 52.420 is amended by revising paragraph (b) to read as follows:
    § 52.420 Identification of plan.

    (b) Incorporation by reference. (1) Material listed in in paragraphs (c) and (d) of this section with an EPA approval date prior to July 1, 2016, was approved for incorporation by reference by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Entries in paragraphs (c) and (d) of this section with the EPA approval dates after July 1, 2016 for the State of Delaware have been approved by EPA for the inclusion in the SIP and for incorporation by reference into the plan as it is contained in this section, and will be considered by the Director of the Federal Register for approval in the next update to the SIP compilation.

    (2) EPA Region III certifies that the materials provided by EPA at the addresses in paragraph (b)(3) of this section are an exact duplicate of the officially promulgated state rules/regulations which have been approved as part of the SIP as of the dates referenced in paragraph (b)(1). No additional revisions were made to paragraph (d) between the last incorporation by reference date of July 1, 2013 and July 1, 2016.

    (3) Copies of the materials incorporated by reference into the state implementation plan may be inspected at the Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. To obtain the material, please call the Regional Office at (215) 814-3376. You may also inspect the material with an EPA approval date prior to July 1, 2016 for the State of Delaware at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    [FR Doc. 2017-10911 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R10-OAR-2016-0785; FRL-9963-12-Region 10] Air Plan Approval; Washington: General Regulations for Air Pollution Sources, Energy Facility Site Evaluation Council AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving updates to the Energy Facility Site Evaluation Council (EFSEC) air quality regulations in the Washington State Implementation Plan (SIP). The EFSEC regulations primarily adopt by reference the Washington Department of Ecology (Ecology) general air quality regulations, which the EPA approved in the fall of 2014 and spring of 2015. Consistent with our approval of the Ecology general air quality regulations, we are also approving revisions to EFSEC's air quality regulations to implement the preconstruction permitting regulations for large industrial (major source) energy facilities in attainment and unclassifiable areas, called the Prevention of Significant Deterioration (PSD) program. The PSD program for major energy facilities under EFSEC's jurisdiction has historically been operated under a Federal Implementation Plan (FIP), in cooperation with the EPA and Ecology. This final approval of the EFSEC PSD program transfers the authority for issuing PSD permits from EPA to EFSEC for all of the categories of energy facilities for which EFSEC has jurisdiction. This narrows the current FIP to cover only those energy facilities for which EFSEC does not have jurisdiction or authority. The EPA is also approving EFSEC's visibility protection permitting program which overlaps significantly with the PSD program in most cases.

    DATES:

    This final rule is effective June 29, 2017.

    ADDRESSES:

    The EPA has established a docket for this action under Docket ID No. EPA-R10-OAR-2016-0785. All documents in the docket are listed on the http://www.regulations.gov Web site. Although listed in the index, some information may not be publicly available, i.e., Confidential Business Information or other information the disclosure of which is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and is publicly available only in hard copy form. Publicly available docket materials are available at http://www.regulations.gov or at EPA Region 10, Office of Air and Waste, 1200 Sixth Avenue, Seattle, Washington 98101. The EPA requests that you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official hours of business are Monday through Friday, 8:30 to 4:30, excluding Federal holidays.

    FOR FURTHER INFORMATION CONTACT:

    Jeff Hunt, Air Planning Unit, Office of Air and Waste (OAW-150), Environmental Protection Agency, Region 10, 1200 Sixth Ave. Suite 900, Seattle, WA 98101; telephone number: (206) 553-0256; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

    Table of Contents I. Background Information II. Response to Comments III. Final Action IV. Incorporation by Reference V. Statutory and Executive Orders Review I. Background Information

    On March 22, 2017, the EPA proposed to approve revisions to EFSEC's general air quality regulations in the SIP (82 FR 14648). An explanation of the Clean Air Act (CAA) requirements, a detailed analysis of the revisions, and the EPA's reasons for proposing approval were provided in the notice of proposed rulemaking, and will not be restated here. The public comment period for this proposed rule ended on April 21, 2017. The EPA received one comment on the proposal.

    II. Response to Comments

    Comment: “We need to protect clean air. The regulations that decrease air pollution should be fully funded and enforced.”

    Response: The SIP revision package submitted jointly by Ecology and EFSEC discussed the personnel, funding, and authority provided by both agencies in operating the air quality program for sources under EFSEC's jurisdiction. As discussed in our proposal, the EPA has worked cooperatively with Ecology and EFSEC for over twenty years in issuing PSD and visibility permits, as well as meeting other air quality requirements. Therefore, consistent with our proposal, we have determined that EFSEC has adequate personnel, funding, and authority to implement the PSD and visibility protection programs and that the revised EFSEC regulations meet the criteria for approval under CAA section 110.

    III. Final Action A. Regulations Approved and Incorporated by Reference Into the SIP

    The EPA is approving, and incorporating by reference, the submitted revisions to Chapter 463-78 Washington Administrative Code (WAC) set forth below as amendments to 40 CFR part 52.

    B. Approved But Not Incorporated by Reference Regulations

    In addition to the regulations approved and incorporated by reference, the EPA reviews and approves state submissions to ensure they provide adequate enforcement authority and other general authority to implement and enforce the SIP. However, regulations describing state enforcement and other general authorities are generally not incorporated by reference, so as to avoid potential conflict with the EPA's independent authorities. The EPA has reviewed and is approving WAC 463-78-135 Criminal Penalties, WAC 463-78-140 Appeals Procedure (except subsections 3 and 4 which deal with permits outside the scope of CAA section 110), WAC 463-78-170 Conflict of Interest, and WAC 463-78-230 Regulatory Actions, as providing EFSEC with adequate enforcement and other general authority for purposes of implementing and enforcing its SIP, but is not incorporating these sections by reference into the SIP codified in 40 CFR 52.2470(c). Instead, the EPA is including these sections in 40 CFR 52.2470(e), EPA Approved Nonregulatory Provisions and Quasi-Regulatory Measures, as approved but not incorporated by reference regulatory provisions.

    C. Regulations To Remove From the SIP

    As discussed in our July 10, 2014 proposed approval of revisions to Chapter 173-400 WAC, Ecology formerly relied on the registration program under WAC 173-400-100 for determining the applicability of the new source review (NSR) permitting program (see 79 FR 39351 at page 39354). By statutory directive, this means of determining NSR applicability was replaced by revisions to WAC 173-400-110 which set inconsequential unit, activity, and emissions thresholds. In our October 3, 2014 final action, we approved WAC 173-400-110 as the means of determining NSR applicability, and at Ecology's request, removed WAC 173-400-100 from the SIP (79 FR 59653). Consistent with our proposed and final approval of revisions to Chapter 173-400 WAC, we are now removing, at EFSEC's request, WAC 463-39-100 Registration (recodified to WAC 463-78-100) from the SIP because it is no longer used as the means of determining NSR applicability.

    As discussed in the proposal for this action, EFSEC adopted by reference most of the provisions in Chapter 173-400 WAC, but excluded certain provisions pertaining to authorities or source categories outside EFSEC's jurisdiction. WAC 173-400-151 Retrofit Requirements for Visibility Protection is one such provision. The EPA's May 23, 1996 approval of EFSEC's regulations included the incorporation by reference of WAC 173-400-151 (61 FR 25791). These regulations establish Best Available Retrofit Technology (BART) as part of the visibility protection program for an “existing stationary facility.” Under WAC 173-400-151 an “existing stationary facility” is defined, among other factors, as a facility not in operation prior to August 7, 1962, and also in existence on August 7, 1977. EFSEC advised the EPA that there are no sources under EFSEC's jurisdiction that meet the definition of BART-eligible sources. The EPA is therefore granting EFSEC's request to remove the incorporation by reference of WAC 173-400-151 from the SIP.

    D. Transfer of Existing EPA-Issued PSD Permits

    As part of the SIP revision package, EFSEC requested approval to exercise its authority to fully administer the PSD program with respect to those sources under EFSEC's permitting jurisdiction that have existing PSD permits issued by the EPA. This includes authority to conduct general administration of these existing permits, authority to process and issue any and all subsequent PSD permit actions relating to such permits (e.g., modifications, amendments, or revisions of any nature), and authority to enforce such permits. Since 1993, EFSEC has had partial delegation of the PSD permitting program under the FIP and the EPA permits subject to transfer were also issued under state authority. EFSEC, in coordination with Ecology, has demonstrated adequate authority to enforce and modify these permits. Concurrent with our final approval of EFSEC's PSD program into the Washington SIP, we are transferring the EPA-issued permits to EFSEC for the Chehalis Generation Facility and Grays Harbor Energy Center facilities.

    E. Scope of Final Action

    The EFSEC PSD and visibility permitting programs primarily incorporate Chapter 173-400 by reference and the December 20, 2016 SIP revision package requested that the EPA approve the updated EFSEC regulations consistent with our prior approval of the Ecology regulations. As discussed in our April 29, 2015 approval of Ecology's regulations under Chapter 173-400 WAC, Washington State does not regulate certain carbon dioxide emissions from industrial combustion of biomass under its PSD program. See 80 FR 23721, at page 23722. We are therefore revising the PSD FIP at 40 CFR 52.2497 and the visibility protection FIP at 40 CFR 52.2498 to reflect the approval of EFSEC's PSD and visibility permitting programs, consistent with our prior approval of Chapter 173-400 WAC.

    Also as discussed in our prior approval of Ecology's updated Chapter 173-400 WAC regulations, the EPA is excluding from the scope of this approval of EFSEC's PSD and visibility permitting programs all Indian reservations in the State, except for nontrust land within the exterior boundaries of the Puyallup Indian Reservation (also known as the 1873 Survey Area), and any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. See 80 FR 23721, at page 23726. Under the Puyallup Tribe of Indians Settlement Act of 1989, 25 U.S.C. 1773, Congress explicitly provided state and local air agencies in Washington authority over activities on non-trust lands within the 1873 Survey Area and the EPA is therefore approving EFESEC's PSD and visibility permitting programs into the SIP with respect to such lands.

    IV. Incorporation by Reference

    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 as described in the amendments to 40 CFR part 52 set forth below. These materials have been approved by the EPA for inclusion in the SIP, have been incorporated by reference by the EPA into that plan, are fully federally-enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of the EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.1 The EPA has made, and will continue to make, these materials generally available through http://www.regulations.gov and/or at the EPA Region 10 Office (please contact the person identified in the “For Further Information Contact” section of this preamble for more information).

    1 62 FR 27968 (May 22, 1997).

    V. Statutory and Executive Orders Review

    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, the EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because this action does not involve technical standards; 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, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because it will not impose substantial direct costs on tribal governments or preempt tribal law. The SIP is not approved to apply in Indian country located in the state, except for non-trust land within the exterior boundaries of the Puyallup Indian Reservation (also known as the 1873 Survey Area), or any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. Consistent with EPA policy, the EPA provided a consultation opportunity to the Puyallup Tribe in a letter dated July 1, 2016. The EPA did not receive a request for consultation.

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. The EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 31, 2017. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2)).

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: May 17, 2017. Michelle L. Pirzadeh, Acting Regional Administrator, Region 10.

    For the reasons set forth in the preamble, 40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart WW—Washington 2. Amend § 52.2470 by revising Table 3 of paragraph (c) and Table 1 of paragraph (e), to read as follows:
    § 52.2470 Identification of plan.

    (c) * * *

    Table 3—Additional Regulations Approved For The Energy Facilities Site Evaluation Council (EFSEC) Jurisdiction [See the SIP-approved provisions of WAC 463-78-020 for jurisdictional applicability] State citation Title/subject State effective date EPA approval date Explanations Washington Administrative Code, Chapter 463-78—General and Operating Permit Regulations for Air Pollution Sources 78-005 Adoption by Reference 8/27/15 5/30/17, [Insert Federal Register citation] Except: (2), (3), (4), and (5). See below for revised Chapter 173-400 WAC provisions incorporated by reference. 78-010 Purpose 8/27/15 5/30/17, [Insert Federal Register citation] 78-020 Applicability 11/11/04 5/30/17, [Insert Federal Register citation] 78-030 Additional Definitions 8/27/15 5/30/17, [Insert Federal Register citation] Except references to 173-401-200 and 173-406-101. 78-095 Permit Issuance 8/27/15 5/30/17, [Insert Federal Register citation] 78-120 Monitoring and Special Report 11/11/04 5/30/17, [Insert Federal Register citation] Washington Administrative Code, Chapter 173-400 Regulations Incorporated by Reference in WAC 463-78-005 173-400-030 Definitions 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-030(91). 173-400-036 Relocation of Portable Sources 12/29/12 5/30/17, [Insert Federal Register citation]. 173-400-040 General Standards for Maximum Emissions 4/1/11 5/30/17, [Insert Federal Register citation] Except: 173-400-040(2)(c); 173-400-040(2)(d); 173-400-040(3); 173-400-040(5); 173-400-040(7), second paragraph. 173-400-050 Emission Standards for Combustion and Incineration Units 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-050(2); 173-400-050(4); 173-400-050(5). 173-400-060 Emission Standards for General Process Units 2/10/05 173-400-070 Emission Standards for Certain Source Categories 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-070(1); 173-400-070(2); 173-400-070(3); 173-400-070(4); 173-400-070(6); 173-400-070(7); 173-400-070(8). 173-400-081 Startup and Shutdown 4/1/11 5/30/17, [Insert Federal Register citation] 173-400-091 Voluntary Limits on Emissions 4/1/11 5/30/17, [Insert Federal Register citation] 173-400-105 Records, Monitoring, and Reporting 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-107 Excess Emissions 9/20/93 6/2/95, 60 FR 28726. 173-400-110 New Source Review (NSR) for Sources and Portable Sources 12/29/12 5/30/17, [Insert Federal Register citation] Except:
  • 173-400-110(1)(c)(ii)(C); 173-400-110(1)(e); 173-400-110(2)(d); The part of WAC 173-400-110(4)(b)(vi) that says, “not for use with materials containing toxic air pollutants, as listed in chapter 173-460 WAC,”;.
  • The part of 400-110 (4)(e)(iii) that says, “where toxic air pollutants as defined in chapter 173-460 WAC are not emitted”;. The part of 400-110(4)(f)(i) that says, “that are not toxic air pollutants listed in chapter 173-460 WAC”;. The part of 400-110 (4)(h)(xviii) that says, “, to the extent that toxic air pollutant gases as defined in chapter 173-460 WAC are not emitted”; The part of 400-110 (4)(h)(xxxiii) that says, “where no toxic air pollutants as listed under chapter 173-460 WAC are emitted”;. The part of 400-110(4)(h)(xxxiv) that says, “, or ≤ 1% (by weight) toxic air pollutants as listed in chapter 173-460 WAC”;. The part of 400-110(4)(h)(xxxv) that says, “or ≤ 1% (by weight) toxic air pollutants”; The part of 400-110(4)(h)(xxxvi) that says, “or ≤ 1% (by weight) toxic air pollutants as listed in chapter 173-460 WAC”;. 400-110(4)(h)(xl) , second sentence; The last row of the table in 173-400-110(5)(b) regarding exemption levels for Toxic Air Pollutants. 173-400-111 Processing Notice of Construction Applications for Sources, Stationary Sources and Portable Sources 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-111(3)(h); 173-400-111(5)(a) (last six words); 173-400-111(6); The part of 173-400-111(8)(a)(v) that says, “and 173-460-040,”; 173-400-111(9). 173-400-112 Requirements for New Sources in Nonattainment Areas—Review for Compliance with Regulations 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-113 New Sources in Attainment or Unclassifiable Areas—Review for Compliance with Regulations 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-113(3), second sentence. 173-400-116 Increment Protection 9/10/11 5/30/17, [Insert Federal Register citation] 173-400-117 Special Protection Requirements for Federal Class I Areas 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-131 Issuance of Emission Reduction Credits 4/1/11 5/30/17, [Insert Federal Register citation] 173-400-136 Use of Emission Reduction Credits (ERC) 4/1/11 5/30/17, [Insert Federal Register citation] 173-400-161 Compliance Schedules 3/22/91 6/2/95, 60 FR 28726 173-400-171 Public Notice and Opportunity for Public Comment 12/29/12 5/30/17, [Insert Federal Register citation] Except: The part of 173-400-171(3)(b) that says, “or any increase in emissions of a toxic air pollutant above the acceptable source impact level for that toxic air pollutant as regulated under chapter 173-460 WAC”; 173-400-171(12). 173-400-175 Public Information 2/10/05 5/30/17, [Insert Federal Register citation] 173-400-190 Requirements for Nonattainment Areas 3/22/91 6/2/95, 60 FR 28726 173-400-200 Creditable Stack Height and Dispersion Techniques 2/10/05 5/30/17, [Insert Federal Register citation] 173-400-205 Adjustment for Atmospheric Conditions 3/22/91 6/2/95, 60 FR 28726 173-400-700 Review of Major Stationary Sources of Air Pollution 4/1/11 5/30/17, [Insert Federal Register citation] 173-400-710 Definitions 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-720 Prevention of Significant Deterioration (PSD) 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-720(4)(a)(i through iv); 173-400-720(4)(b)(iii)(C); and 173-400-720(4)(a)(vi) with respect to the incorporation by reference of the text in 40 CFR 52.21(b)(49)(v).
  • * For the purpose of EFSEC's incorporation by reference of 40 CFR 52.21, the date in WAC 173-400-720 (4)(a)(vi) is May 1, 2015.
  • 173-400-730 Prevention of Significant Deterioration Application Processing Procedures 12/29/12 5/30/17, [Insert Federal Register citation] Except 173-400-730(4). 173-400-740 PSD Permitting Public Involvement Requirements 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-750 Revisions to PSD Permits 12/29/12 5/30/17, [Insert Federal Register citation] Except: 173-400-750(2) second sentence. 173-400-800 Major Stationary Source and Major Modification in a Nonattainment Area 4/1/11 5/30/17, [Insert Federal Register citation] 173-400-810 Major Stationary Source and Major Modification Definitions 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-820 Determining if a New Stationary Source or Modification to a Stationary Source is Subject to these Requirements 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-830 Permitting Requirements 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-840 Emission Offset Requirements 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-850 Actual Emissions Plantwide Applicability Limitation (PAL) 12/29/12 5/30/17, [Insert Federal Register citation] 173-400-860 Public Involvement Procedures 4/1/11 5/30/17, [Insert Federal Register citation]

    (e) * * *

    Table 1—Approved But Not Incorporated By Reference Regulations State/local citation Title/subject State/local
  • effective date
  • EPA approval date Explanations
    Washington Department of Ecology Regulations 173-400-220 Requirements for Board Members 3/22/91 6/2/95, 60 FR 28726 173-400-230 Regulatory Actions 3/20/93 6/2/95, 60 FR 28726 173-400-240 Criminal Penalties 3/22/91 6/2/95, 60 FR 28726 173-400-250 Appeals 9/20/93 6/2/95, 60 FR 28726 173-400-260 Conflict of Interest 07/01/16 10/6/16, 81 FR 69385 173-433-200 Regulatory Actions and Penalties 10/18/90 1/15/93, 58 FR 4578 Energy Facility Site Evaluation Council Regulations 463-78-135 Criminal Penalties 11/11/04 5/30/17, [Insert Federal Register citation] 463-78-140 Appeals Procedure 3/26/06 5/30/17, [Insert Federal Register citation] Except (3) and (4). 463-78-170 Conflict of Interest 11/11/04 5/30/17, [Insert Federal Register citation] 463-78-230 Regulatory Actions 11/11/04 5/30/17, [Insert Federal Register citation] Benton Clean Air Agency Regulations 2.01 Powers and Duties of the Benton Clean Air Agency (BCAA) 12/11/14 11/17/15, 80 FR 71695 2.02 Requirements for Board of Directors Members 12/11/14 11/17/15, 80 FR 71695 2.03 Powers and Duties of the Board of Directors 12/11/14 11/17/15, 80 FR 71695 2.04 Powers and Duties of the Control Officer 12/11/14 11/17/15, 80 FR 71695 2.05 Severability 12/11/14 11/17/15, 80 FR 71695 2.06 Confidentiality of Records and Information 12/11/14 11/17/15, 80 FR 71695 Olympic Region Clean Air Agency Regulations 8.1.6 Penalties 5/22/10 10/3/13, 78 FR 61188 Southwest Clean Air Agency Regulations 400-220 Requirements for Board Members 3/18/01 04/10/17, 82 FR 17136 400-230 Regulatory Actions and Civil Penalties 10/9/16 04/10/17, 82 FR 17136 400-240 Criminal Penalties 3/18/01 04/10/17, 82 FR 17136 400-250 Appeals 11/9/03 04/10/17, 82 FR 17136 400-260 Conflict of Interest 3/18/01 04/10/17, 82 FR 17136 400-270 Confidentiality of Records and Information 11/9/03 04/10/17, 82 FR 17136 400-280 Powers of Agency 3/18/01 04/10/17, 82 FR 17136 Spokane Regional Clean Air Agency Regulations 8.11 Regulatory Actions and Penalties 09/02/14 09/28/15, 80 FR 58216
    3. Amend § 52.2497 by revising paragraph (a) to read as follows:
    § 52.2497 Significant deterioration of air quality.

    (a) The requirements of sections 160 through 165 of the Clean Air Act are not fully met because the plan does not include approvable procedures for preventing the significant deterioration of air quality from:

    (1) Facilities with carbon dioxide (CO2) emissions from the industrial combustion of biomass in the following circumstances:

    (i) Where a new major stationary source or major modification would be subject to Prevention of Significant Deterioration (PSD) requirements for greenhouse gases (GHGs) under 40 CFR 52.21 but would not be subject to PSD under the state implementation plan (SIP) because CO2 emissions from the industrial combustion of biomass are excluded from consideration as GHGs as a matter of state law under RCW 70.235.020(3); or

    (ii) Where a new major stationary source or major modification is subject to PSD for GHGs under both the Washington SIP and the FIP, but CO2 emissions from the industrial combustion of biomass are excluded from consideration in the Ecology PSD permitting process because of the exclusion in RCW 70.235.020(3);

    (2) Indian reservations in Washington, except for non-trust land within the exterior boundaries of the Puyallup Indian Reservation (also known as the 1873 Survey Area) as provided in the Puyallup Tribe of Indians Settlement Act of 1989, 25 U.S.C. 1773, and any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction.

    (3) Sources subject to PSD permits issued by the EPA prior to August 7, 1977, but only with respect to the general administration of any such permits still in effect (e.g., modifications, amendments, or revisions of any nature).

    4. Amend § 52.2498 by revising paragraph (a) to read as follows:
    § 52.2498 Visibility protection.

    (a) The requirements of section 169A of the Clean Air Act are not fully met because the plan does not include approvable procedures for visibility new source review for:

    (1) Sources subject to the jurisdiction of local air authorities (except Benton Clean Air Agency and Southwest Clean Air Agency);

    (2) Indian reservations in Washington except for non-trust land within the exterior boundaries of the Puyallup Indian Reservation (also known as the 1873 Survey Area) as provided in the Puyallup Tribe of Indians Settlement Act of 1989, 25 U.S.C. 1773, and any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction.

    [FR Doc. 2017-10908 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [VA203-5204; FRL-9957-86-Region 3] Air Plan Approval; Virginia; Update to Materials Incorporated by Reference AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule; administrative change.

    SUMMARY:

    The Environmental Protection Agency (EPA) is updating the materials that are incorporated by reference (IBR) into the Virginia state implementation plan (SIP). The regulations affected by this update have been previously submitted by the Virginia Department of Environmental Quality (VADEQ) and approved by EPA. This update affects the SIP materials that are available for public inspection at the National Archives and Records Administration (NARA) and the EPA Regional Office.

    DATES:

    This action is effective May 30, 2017, except that amendatory instruction 2.d amending 40 CFR 52.2420(e) is effective June 9, 2017.

    ADDRESSES:

    SIP materials which are incorporated by reference into 40 CFR part 52 are available for inspection at the following locations: Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103; or NARA. For information on the availability of this material at NARA, call 202-741-6030, or go to: http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.

    FOR FURTHER INFORMATION CONTACT:

    Sharon McCauley, (215) 814-3376 or by email at [email protected]

    SUPPLEMENTARY INFORMATION: I. Background

    The SIP is a living document which a state revises as necessary to address its unique air pollution problems. Therefore, EPA, from time to time, must take action on SIP revisions containing new and/or revised regulations as being part of the SIP. On May 22, 1997 (62 FR 27968), EPA revised the procedures for incorporating by reference federally-approved SIPs, as a result of consultations between EPA and the Office of the Federal Register (OFR). The description of the revised SIP document, IBR procedures and “Identification of plan” format are discussed in further detail in the May 22, 1997 Federal Register document. On April 21, 2000 (65 FR 21315), EPA published a document in the Federal Register beginning the new IBR procedure for Virginia. On September 8, 2004 (69 FR 54216), November 3, 2005 (70 FR 66769), July 16, 2007 (72 FR 38920), July 13, 2009 (74 FR 33332) as corrected on December 18, 2009 (74 FR 67077), and November 21, 2011 (76 FR 71881), EPA published updates to the IBR material for Virginia.

    Since the publication of the last IBR update, EPA has approved the following regulatory changes to the following regulations and sections for Virginia.

    A. Added 9VAC5 Regulations and Source Specific Requirements

    1. Chapter 30 (Ambient Air Quality Standards), section 5-30-67.

    2. Chapter 40 (Existing Stationary Sources), part II (Emission Standards), article 48 (Emission Standards for Mobile Equipment Repair and Refinishing), section 5-40-6975.

    3. Chapter 45 (Consumer and Commercial Products) (entire chapter; part I (Special Provisions are added); 7 articles in part II (Emission Standards) are added:

    a. Part I—Special Provisions b. Part II—Article 1—Emission Standards for Portable Fuel Containers and Spouts Manufactured Before August 1, 2010 c. Part II—Article 2—Emission Standards for Portable Fuel Containers and Spouts Manufactured on or After August 1, 2010 d. Part II—Article 3—Emission Standards for Consumer Products Manufactured Before August 1, 2010 e. Part II—Article 4—Emission Standards for Consumer Products Manufactured on or After August 1, 2010 f. Part II—Article 5—Emission Standards for Architectural and Industrial Maintenance Coatings g. Part II—Article 6—Emission Standards for Adhesives and Sealants h. Part II—Article 7—Emission Standards for Asphalt Paving Operations

    4. Chapter 80 (Permits for Stationary Sources), Article 8 (Permits—Major Stationary Sources and Major Modifications Located in Nonattainment Areas or the Ozone Transport Region)), section 5-80-1915.

    5. Chapter 80 (Permits for Stationary Sources), Article 9 (Permits—Major Stationary Sources and Major Modifications Located in Nonattainment Areas or the Ozone Transport Region), section 5-80-2195.

    6. Chapter 85 (Permits for Stationary Sources of Pollutants Subject to Regulation), part III (Prevention of Significant Deterioration Permit Actions), section 5-85-55.

    7. Chapter 160 (Regulation for General Conformity), part III (Criteria and Procedures for Making Conformity Determinations), sections 5-160-181 through 5-160-185 inclusive.

    8. Chapter 170 (Regulations for General Administration), part IX, Conflict of Interest, section 5-170-210.

    9. Code of Virginia, section 10-1-1302 (Qualifications of members of Boards).

    10. The addition of an operating permit under Source Specific Requirements for GP Big Island, LLC (Registration Number 20232).

    11. The addition of an operating permit under Source Specific Requirements for Mead Westvaco Corporation (Registration Number 20328).

    12. The addition of an operating permit under Source Specific Requirements for O-N Minerals Facility (Registration Number 80252).

    13. The addition of an operating permit under Source Specific Requirements for Mondelez Global LLC, Inc.—Richmond Bakery (Registration Number 50703).

    B. Revised 9VAC5 Regulations

    1. Chapter 10 (General Definitions), section 5-10-20 (Terms Defined) and section 5-10-30 (Abbreviations).

    2. Chapter 20 (General Provisions), part II, sections 5-20-203 (Air Quality Maintenance Areas) and 5-20-204 (Nonattainment Areas).

    3. Chapter 30 (Ambient Air Quality Standards), sections 5-30-15, 5-30-30, and 5-30-55.

    4. Chapter 40 (Existing Stationary Sources), part II (Emission Standards), article 4, section name changed to General Process Operations.

    5. Chapter 40 (Existing Stationary Sources), part II (Emission Standards), article 43 (Municipal Solid Waste Landfills), sections 5-40-5810, 5-40-5820, 5-40-5850, 5-40-5880, and 5-40-5920.

    6. Chapter 40 (Existing Stationary Sources), part II (Emission Standards), article 48 (Emission Standards for Mobile Equipment Repair and Refinishing), sections 5-40-6970 and 5-40-7050.

    7. Chapter 45 (Consumer and Commercial Products (applicable to the Northern Virginia and Fredericksburg VOC Emissions Control Areas)), part II (Emission Standards), article 1 (Emission Standards for Portable Fuel Containers and Spouts Manufactured Before August 1, 2010), sections 5-45-70 and 5-45-90.

    8. Chapter 45 (Consumer and Commercial Products (applicable to the Northern Virginia and Fredericksburg VOC Emissions Control Areas)), part II (Emission Standards), article 2 (Emission Standards for Portable Fuel Containers and Spouts Manufactured On or After August 1, 2010), sections 5-45-160, 5-45-170 and 5-45-240.

    9. Chapter 45 (Consumer and Commercial Products (applicable to the Northern Virginia and Fredericksburg VOC Emissions Control Areas)), part II (Emission Standards), article 3 (Emission Standards for Consumer Products Manufactured Before August 1, 2010), section 5-45-310.

    10. Chapter 45 (Consumer and Commercial Products (applicable to the Northern Virginia and Fredericksburg VOC Emissions Control Areas)), part II (Emission Standards), article 4 (Emission Standards for Consumer Products Manufactured On or After August 1, 2010), sections 5-45-400, 5-45-420, 5-45-430 and 5-45-480.

    11. Chapter 45 (Consumer and Commercial Products (applicable to the Northern Virginia and Fredericksburg VOC Emissions Control Areas)), part II (Emission Standards), article 5 (Emission Standards for Architectural and Industrial Maintenance Coatings), sections 5-45-520, 5-45-530 and 5-45-580.

    12. Chapter 45 (Consumer and Commercial Products (applicable to the Northern Virginia and Fredericksburg VOC Emissions Control Areas)), part II (Emission Standards), article 6 (Emission Standards for Adhesives and Sealants), sections 5-45-620, 5-45-630, 5-45-650 and 5-45-700.

    13. In Chapter 80:

    a. Article 8 (Permits-Major Stationary Sources and Major Modifications Located in Prevention of Significant Deterioration Areas), sections 5-80-1615, 5-80-1625, 5-80-1635, 5-80-1695, 5-80-1715, 5-80-1765, and 5-80-1925 through 5-80-1965 inclusive.

    b. Article 9, sections 5-80-2010, 5-80-2020, 5-80-2120, 5-80-2140, and 5-80-2200 through 5-80-2240 inclusive.

    14. Chapter 85 (Permits for Stationary Sources of Pollutants Subject to Regulation), part III (Prevention of Significant Deterioration Permit Actions), section 5-85-50.

    15. Chapter 130 (Regulations for Open Burning), part I (General Provisions), sections 5-130-20 and 5-130-40.

    16. Chapter 140 (Regulations for Emissions Trading Programs), part I (NOx Budget Trading Program), article 10 (State Trading Program Budget and Compliance Pool), sections 5-140-900, 5-140-920, and 5-140-930.

    17. Chapter 151 (Transportation Conformity), part III (Criteria and Procedures for Making Conformity Determinations), sections 5-151-40 and 5-151-70.

    18. In Chapter 160:

    a. Part I (General Definitions), section 5-160-20.

    b. Part II (General Provisions), section 5-160-30.

    c. Part III, sections 5-160-110 through 5-160-180 inclusive.

    19. Chapter 170 (Regulation for General Administration), part 1 (Definitions), section 5-170-20.

    C. Removed 9 VAC5 Regulations and Source-Specific Requirements

    1. The following articles in 9VAC5 Chapter 40 (Existing Stationary Sources), part II (Emission Standards) are removed:

    a. Article 39 (Emission Standards for Asphalt Paving Operations) b. Article 42 (Emissions Standards for Portable Fuel Container Spillage) c. Article 49 (Emission Standards for Architectural and Maintenance Coatings) d. Article 50 (Emission Standards for Consumer Products)

    2. Chapter 91 (Regulations for the Control of Motor Vehicle Emissions in the Northern Virginia Area), part II (General Provisions), sections 5-91-40, 5-91-60, 5-91-80, and 5-91-110.

    3. Chapter 160 (Regulation for General Conformity), part III (Criteria and Procedures for Making Conformity Determinations), section 5-160-200.

    4. Chapter 200 (National Low Emission Vehicle Program), in its entirety.

    5. The operating permit for Transcontinental Pipeline Station 175 (Registration No. 40789) in the Source Specific Requirements.

    II. EPA Action

    In this action, EPA is announcing the update to the IBR material as of July 1, 2016 and revising the text within 40 CFR 52.2420(b).

    EPA is revising our 40 CFR part 52 “Identification of Plan” for the Commonwealth of Virginia regarding incorporation by reference, section 52.2420(b). EPA is revising section 52.2420(b)(1) to clarify that all SIP revisions listed in paragraphs (c) and (d), regardless of inclusion in the most recent “update to the SIP compilation,” are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking in which EPA approved the SIP revision, consistent with following our “Approval and Promulgations of Air Quality Implementation Plans; Revised Format of 40 CFR part 52 for Materials Being Incorporated by Reference,” effective May 22, 1997 (62 FR 27968). EPA is revising section 52.2420(b)(2) to clarify references to other portions of paragraph (b) with subparagraph (b)(2). EPA is revising section (b)(3) to update address and contact information. In the table for paragraph 40 CFR 52.2420(c), EPA is:

    1. Reorganizing the entries for section 5-10-20 (Definitions- Terms Defined).

    2. Revising the CFR to include previously approved sections for 5-30-80 (Lead) and 5-160-10 (General).

    3. Revising the entries for sections 5-40-7410, 5-130-10, 5-170-210 and 5-220-60.

    4. Correcting a typographical error in the title of Article 48, Emission Standards for Mobile Equipment Repair and Refinishing (Rule 4-48).

    5. Removing duplicate and/or additional outdated entries for sections 5-80-2020 and 5-85-50.

    In the table for paragraph 52.2420(d), EPA is correcting incorrect Federal Register page citations in the “EPA approval date” column for the following entries: Philip Morris, Inc.—Blended Leaf Facility; Philip Morris, Inc.—Park 500 Facility; Philip Morris, Inc.—Richmond Manufacturing Center; Virginia Electric and Power Co.—Innsbrook Technical Center Hercules, Inc.—Aqualon Division; City of Hopewell—Regional Wastewater Treatment Facility; Allied Signal, Inc.—Hopewell Plant; Allied Signal, Inc.—Chesterfield Plant; Bear Island Paper Co. L.P.; Stone Container Corp.—Hopewell Mill; E.I. Dupont de Nemours and Co.—Spruance Plant; and ICI Americas Inc.—Films Division—Hopewell Site. EPA is also reinserting a previously approved entry for Kraft Foods Global Inc., April 15, 2008 (73 FR 20175) to this paragraph.

    EPA is also splitting the existing § 52.2420(e) table (EPA-approved non-regulatory and quasi-regulatory material) into two tables designated as § 52.2420(e)(1) (Non-regulatory material) and § 52.2420(e)(2) (Documents incorporated by reference in regulation 9VAC5-20-21). While there are format changes in the column titles due to this table organization, the substantive text of the existing entries and any additional entries which have been approved since the last VA IBR update do not change.

    III. Good Cause Exemption

    EPA has determined that this rule falls under the “good cause” exemption in section 553(b)(3)(B) of the Administrative Procedures Act (APA) which, upon finding “good cause,” authorizes agencies to dispense with public participation and section 553(d)(3) which allows an agency to make a rule effective immediately (thereby avoiding the 30-day delayed effective date otherwise provided for in the APA). This rule simply codifies provisions which are already in effect as a matter of law in federal and approved state programs. Under section 553 of the APA, an agency may find good cause where procedures are “impractical, unnecessary, or contrary to the public interest.” Public comment is “unnecessary” and “contrary to the public interest” since the codification only reflects existing law. Immediate notice in the CFR benefits the public by removing outdated citations and incorrect table entries.

    IV. Incorporation by Reference

    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 previously EPA approved regulations promulgated by the Commonwealth of Virginia and federally effective prior to July 1, 2016. Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.1 The EPA has made, and will continue to make, these materials generally available through www.regulations.gov and/or at the EPA Region III Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information).

    1 62 FR 27968 (May 22, 1997).

    V. Statutory and Executive Order Reviews A. General Requirements

    Under the Clean Air Act (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 Order 12866 (58 FR 51735, October 4, 1993);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, the SIP is not approved to apply on any Indian reservation land as defined in 18 U.S.C. 1151 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).

    B. Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This rule is not a “major rule” as defined by 5 U.S.C. 804(2).

    C. Petitions for Judicial Review

    EPA has also determined that the provisions of section 307(b)(1) of the CAA pertaining to petitions for judicial review are not applicable to this action. Prior EPA rulemaking actions for each individual component of the Virginia SIP compilations had previously afforded interested parties the opportunity to file a petition for judicial review in the United States Court of Appeals for the appropriate circuit within 60 days of such rulemaking action. Thus, EPA sees no need in this action to reopen the 60-day period for filing such petitions for judicial review for this “Identification of plan” update action for Virginia.

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: April 1, 2017. Cecil Rodrigues, Acting Regional Administrator, Region III.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart VV—Virginia 2. Section 52.2420 is amended by: a. Revising paragraph (b). b. In paragraph (c): i. Removing the first five entries for section 5-10-20; ii. Adding in numerical order an entry for section 5-30-80; iii. Revising the heading for Article 48; iv. Revising the entry for 5-40-7410; v. Removing the second entry for section 5-80-2020; vi. Removing the entry for section 5-85-50 that follows the entry for section 5-85-55. vii. Revising the entry for 5-130-10; viii. Adding in numerical order an entry for section 5-160-10; ix. Revising the entries for 5-170-210 and 5-220-60. c. In paragraph (d): i. Revising the entries for Philip Morris, Inc.—Blended Leaf Facility; Philip Morris, Inc.—Park 500 Facility; Philip Morris, Inc.—Richmond Manufacturing Center; Virginia Electric and Power Co.—Innsbrook Technical Center; Hercules, Inc.—Aqualon Division; City of Hopewell—Regional Wastewater Treatment Facility; Allied Signal, Inc.—Hopewell Plant; Allied Signal, Inc.—Chesterfield Plant; Bear Island Paper Co. L.P.; Stone Container Corp.—Hopewell Mill; E.I. Dupont de Nemours and Co.—Spruance Plant; and ICI Americas Inc.—Films Division—Hopewell Site. ii. Adding an entry for Kraft Foods Global Inc. after the entry for Global Stone Chemstone Corporation. d. Effective June 9, 2017, revising paragraph (e).

    The amendments read as follows:

    § 52.2420 Identification of plan.

    (b) Incorporation by reference. (1) Material listed in paragraphs (c) and (d) of this section with an EPA approval date prior to July 1, 2016, were approved for incorporation by reference by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Entries in paragraphs (c) and (d) of this section with the EPA approval dates after July 1, 2016 for the Commonwealth of Virginia, have been approved by EPA for inclusion in the State implementation plan and for incorporation by reference into the plan as it is contained in this section, and will be considered by the Director of the Federal Register for approval in the next update to the SIP compilation.

    (2) EPA Region III certifies that the materials provided by EPA at the addresses in paragraph (b)(3) of this section are an exact duplicate of the officially promulgated Commonwealth rules/regulations which have been approved as part of the state implementation plan as of the dates referenced in paragraph (b)(1).

    (3) Copies of the materials incorporated by reference into the state implementation plan may be inspected at the Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. To obtain the material, please call the Regional Office at (215) 814-3376. You may also inspect the material with an EPA approval date prior to July 1, 2016 for the Commonwealth of Virginia at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    (c) * * *

    EPA-Approved Virginia Regulations and Statutes State citation Title/subject State effective date EPA approval date Explanation
  • (former SIP citation)
  • *         *         *         *         *         *         * 9VAC5 Chapter 30—Ambient Air Quality Standards [Part III] *         *         *         *         *         *         * 5-30-80 Lead 6/24/09 4/25/11, 76 FR 22814 Revised section. 9VAC5 Chapter 40—Existing Stationary Sources [Part IV] *         *         *         *         *         *         * Part II—Emission Standards *         *         *         *         *         *         * Article 48—Emission Standards for Mobile Equipment Repairs and Refinishing (Rule 4-48) *         *         *         *         *         *         * Article 51—Stationary Sources Subject to Case-by-Case Control Technology Determinations (Rule 4-51) *         *         *         *         *         *         * 5-40-7410 Standard for nitrogen oxides (1-hour ozone standard) 12/15/06 1/19/11, 76 FR 3023 Added Regulation. *         *         *         *         *         *         * 9VAC5 Chapter 130—Regulations for Open Burning [Formerly 9VAC5 Chapter 40, Part II, Article 40] Part I—General Provisions 5-130-10 Applicability 3/18/09 3/14/11, 76 FR 13511 Formerly 5-40-5600.
  • Provisions of this Chapter expanded to new localities in the emissions control areas.
  • *         *         *         *         *         *         * 9VAC5 Chapter 160, Part I—General Definitions—General Conformity *         *         *         *         *         *         * 5-160-10 General 1/1/98 1/7/03, 68 FR 663. *         *         *         *         *         *         * 9VAC5 Chapter 170, Part IX—Conflict of Interest—Regulation for General Administration *         *         *         *         *         *         * 5-170-210 General 11/19/14 4/25/15, 80 FR 17695 Docket #2015-0040. Does not include subsection B. *         *         *         *         *         *         * 9VAC5 Chapter 220—Opacity Variance for Rocket Testing Operations Atlantic Research Corporation's Orange County Facility *         *         *         *         *         *         * 5-220-60 Applicability of future regulation amendments 12/1/02 9/4/09, 74 FR 45766. *         *         *         *         *         *         *

    (d) * * *

    EPA-Approved Source Specific Requirements Source name Permit/order or
  • registration No.
  • State effective date EPA approval date 40 CFR part 52
  • citation
  • *         *         *         *         *         *         * Philip Morris, Inc.—Blended Leaf Facility 50080 2/27/86 10/14/97, 62 FR 53242 52.2465(c)(120). Philip Morris, Inc.—Park 500 Facility 50722 3/26/97 10/14/97, 62 FR 53242 52.2465(c)(120). Philip Morris, Inc.—Richmond Manufacturing Center 50076 7/13/96 10/14/97, 62 FR 53242 52.2465(c)(120). Virginia Electric and Power Co.—Innsbrook Technical Center 50396 5/30/96 10/14/97, 62 FR 53242 52.2465(c)(120). Hercules, Inc.—Aqualon Division V-0163-96 7/12/96 10/14/97, 62 FR 53242 52.2465(c)(120). City of Hopewell—Regional Wastewater Treatment Facility 50735 5/30/96 10/14/97, 62 FR 53242 52.2465(c)(120). Allied Signal, Inc.—Hopewell Plant 50232 3/26/97 10/14/97, 62 FR 53242 52.2465(c)(121). Allied Signal, Inc.—Chesterfield Plant V-0114-96 5/20/96 10/14/97, 62 FR 53242 52.2465(c)(121). Bear Island Paper Co. L.P V-0135-96 7/12/96 10/14/97, 62 FR 53242 52.2465(c)(121). Stone Container Corp.—Hopewell Mill 50370 5/30/96 10/14/97, 62 FR 53242 52.2465(c)(121). E.I. Dupont de Nemours and Co.—Spruance Plant V-0117-96 5/30/96 10/14/97, 62 FR 53242 52.2465(c)(121). ICI Americas Inc.—Films Division—Hopewell Site 50418 5/30/96 10/14/97, 62 FR 53242 52.2465(c)(121). *         *         *         *         *         *         * Kraft Foods Global, Inc.—Richmond Bakery Registration No. 50703 9/19/07 4/15/08, 73 FR 20175 52.2420(d)(8). *         *         *         *         *         *         *

    (e) EPA-approved non-regulatory and quasi-regulatory material.

    (1) Non-regulatory material.

    Name of non-regulatory
  • SIP revision
  • Applicable geographic area State submittal date EPA approval date Additional explanation
    Commitment Letter-Clean fuel fleet or alternative substitute program Northern Virginia Ozone nonattainment Area 1/25/93 9/23/93, 58 FR 50846 52.2423(j). Motor vehicle emissions budgets Hampton Roads Ozone Maintenance Area 8/29/96 6/26/97, 62 FR 34408 52.2424(a). Motor vehicle emissions budgets Richmond Ozone Maintenance Area 7/30/96 11/17/97, 62 FR 61237 52.2424(b). 1990 Base Year Emissions Inventory-Carbon Monoxide (CO) Metropolitan Washington Area 11/1/93, 4/3/95, 10/12/95 1/30/96, 61 FR 2931 52.2425(a). 1990 Base Year Emissions Inventory-Carbon Monoxide (CO), oxides of nitrogen (NOX), & volatile organic compounds (VOC) Richmond-Petersburg, Norfolk-Virginia Beach, and Smyth County Ozone Areas 11/11/92, 11/18/92, 11/1/93, 12/15/94 9/16/96, 61 FR 48657 52.2425(b). 1990 Base Year Emissions Inventory-Carbon Monoxide (CO), oxides of nitrogen (NOX), & volatile organic compounds (VOC) Northern Virginia (Metropolitan Washington) Ozone Nonattainment Area 11/30/92, 11/1/93, 4/3/95 9/16/96, 61 FR 54656 52.2425(c). 1990 Base Year Emissions Inventory-oxides of nitrogen (NOX), & volatile organic compounds (VOC) Northern Virginia (Metropolitan Washington) Ozone Nonattainment Area 12/17/97 7/8/98, 63 FR 36854. Photochemical Assessment Monitoring Stations (PAMS) Program Northern Virginia (Metropolitan Washington) Ozone Nonattainment Area 11/15/94 9/11/95, 60 FR 47081 52.2426. Attainment determination of the ozone NAAQS Richmond Ozone Nonattainment Area 7/26/96 10/6/97, 62 FR 52029 52.2428(a). 15% rate of progress plan Northern Virginia (Metropolitan Washington) Ozone Nonattainment Area 4/14/98 10/6/00, 65 FR 59727 52.2428(b). Small business stationary source technical and environmental assistance program Statewide 11/10/92 2/14/94, 59 FR 5327 52.2460. Establishment of Air Quality Monitoring Network Statewide 3/24/80 12/5/80, 45 FR 86530 52.2465(c)(38). Lead (Pb) SIP Statewide 12/31/80 3/21/82, 45 FR 8566 52.2465(c)(61). Carbon Monoxide Maintenance Plan Arlington County & Alexandria City 3/22/04 4/4/05, 70 FR 16958 Revised Carbon Monoxide Maintenance Plan Base Year Emissions Inventory using MOBILE6. Ozone Maintenance Plan, emissions inventory & contingency measures Hampton Roads Area 8/27/96 6/26/97, 62 FR 34408 52.2465(c)(117). Ozone Maintenance Plan, emissions inventory & contingency measures Richmond Area 7/26/96 11/17/97, 62 FR 61237 52.2465(c)(119). Non-Regulatory Voluntary Emission Reduction Program Washington, DC severe 1-hour ozone nonattainment area 2/25/04 5/12/05, 70 FR 24987 The nonregulatory measures found in section 7.6 and Appendix J of the plan. 1996-1999 Rate-of-Progress Plan SIP and the Transportation Control Measures (TCMs) in Appendix H Washington 1-hour ozone nonattainment area 12/29/03, 5/25/99 5/16/05, 70 FR 25688 Only the TCMs in Appendix H of the 5/25/1999 revision, 1999 motor vehicle emissions budgets of 128.5 tons per day (tpy) of VOC and 196.4 tpy of NOX. 1990 Base Year Inventory Revisions Washington 1-hour ozone nonattainment area 8/19/03, 2/25/04 5/16/05, 70 FR 25688. 1999-2005 Rate-of-Progress Plan SIP Revision and the Transportation Control Measures (TCMs) in Appendix J Washington 1-hour ozone nonattainment area 8/19/03, 2/25/04 5/16/05, 70 FR 25688 Only the TCMs in Appendix J of the 2/25/2004 revision, 2002 motor vehicle emissions budgets (MVEBs) of 125.2 tons per day (tpy) for VOC and 290.3 tpy of NOX, and, 2005 MVEBs of 97.4 tpy for VOC and 234.7 tpy of NOX. VMT Offset SIP Revision Washington 1-hour ozone nonattainment area 8/19/03, 2/25/04 5/16/05, 70 FR 25688. Contingency Measure Plan Washington 1-hour ozone nonattainment area 8/19/03, 2/25/04 5/16/05, 70 FR 25688. 1-hour Ozone Modeled Demonstration of Attainment and Attainment Plan Washington 1-hour ozone nonattainment area 8/19/03, 2/25/04 5/16/05, 70 FR 25688 2005 motor vehicle emissions budgets of 97.4 tons per day (tpy) for VOC and 234.7 tpy of NOX. 3/18/14 5/26/15, 80 FR 29963 Removal of Stage II vapor recovery program. See section 52.2428. Attainment Demonstration and Early Action Plan for the Roanoke MSA Ozone Early Action Compact Area Botetourt County, Roanoke City, Roanoke County, and Salem City 12/21/04, 2/15/05 8/17/05, 70 FR 43277. Attainment Demonstration and Early Action Plan for the Northern Shenandoah Valley Ozone Early Action Compact Area City of Winchester and Frederick County 12/20/04, 2/15/05 8/17/05, 70 FR 43280. 8-Hour Ozone Maintenance Plan for the Fredericksburg VA Area City of Fredericksburg, Spotsylvania County, and Stafford County 5/4/05 12/23/05, 70 FR 76165. 3/18/14 5/26/15, 80 FR 29963 Revised 2009 and 2015 motor vehicle emission budgets for NOX. 8-Hour Ozone Maintenance Plan for the Madison & Page Cos. (Shenandoah NP), VA Area Madison County (part) and Page County (part) 9/23/05 1/3/05, 71 FR 24. 8-Hour Ozone Maintenance Plan and 2002 Base Year Emissions Inventory Norfolk-Virginia Beach-Newport News (Hampton Roads), VA Area 10/12/06, 10/16/06, 10/18/06, 11/20/06, 2/13/07 6/1/07, 72 FR 30490 The SIP effective date is
  • 6/1/07.
  • 8-Hour Ozone Maintenance Plan and 2002 Base Year Emissions Inventory Richmond-Petersburg VA Area 9/18/06, 9/20/06, 9/25/06, 11/17/06, 2/13/07 6/1/07, 72 FR 30485 The SIP effective date is 6/18/07. Ozone Maintenance Plan White Top Mountain, Smyth County, VA 1-hour Ozone Nonattainment Area 8/6/07 4/29/08, 73 FR 23103. RACT under the 8-Hour NAAQS Stafford County 4/21/08 12/22/08, 73 FR 78192. RACT under the 8-Hour NAAQS Virginia portion of the DC-MD-VA area 10/23/06 6/16/09, 74 FR 28444. Reasonable Further Progress Plan (RFP), Reasonably Available Control Measures, and Contingency Measures Washington DC-MD-VA 1997 8-hour ozone moderate nonattainment area 6/12/07 9/20/11, 76 FR 58206. 2002 Base Year Inventory for VOC, NOX, and CO Washington DC-MD-VA 1997 8-hour ozone moderate nonattainment area 6/12/07 9/20/11, 76 FR 58206. 2008 RFP Transportation Conformity Budgets Washington DC-MD-VA 1997 8-hour ozone moderate nonattainment area 6/12/07 9/20/11, 76 FR 58206. Section 110(a)(2) Infrastructure Requirements for the 1997 Ozone NAAQS Statewide Statewide 7/10/08, 9/2/08, 6/8/10, 6/9/10 10/11/11, 76 FR 62635 This action addresses the following CAA elements or portions thereof: 110(a)(2)(A), (B), (C), (D)(ii), (E), (F), (G), (H), (J), (K), (L), and (M). 11/13/07, 12/13/07, 8/25/11 2/25/14, 79 FR 10377 This action addresses the PSD related elements of the following CAA requirements: 110(a)(2)(D)(i)(II). Section 110(a)(2) Infrastructure Requirements for the 1997 PM2.5 NAAQS Statewide 7/10/08, 9/2/08, 6/8/10, 6/9/10, 4/1/08 10/11/11, 76 FR 62635 This action addresses the following CAA elements or portions thereof: 110(a)(2)(A), (B), (C), (D)(ii), (E), (F), (G), (H), (J), (K), (L), and (M). 11/13/07, 7/10/08, 9/2/08, 8/25/11 2/25/14, 79 FR 10377 This action addresses the PSD related elements of the following CAA requirements: 110(a)(2)(C), (D)(i)(II), and (J). Section 110(a)(2) Infrastructure Requirements for the 2006 PM2.5 NAAQS Statewide 8/30/10, 4/1/11 10/11/11, 76 FR 62635 This action addresses the following CAA elements or portions thereof: 110(a)(2)(A), (B), (C), (D)(ii), (E), (F), (G), (H), (J), (K), (L), and (M). 4/1/11, 8/25/11 2/25/14, 79 FR 10377 This action addresses the PSD related elements of the following CAA requirements: 110(a)(2)(C), (D)(i)(II), and (J). Section 110(a)(2) Infrastructure Requirements for the 2008 Lead NAAQS Statewide 3/9/12 9/24/13, 78 FR 58462 This action addresses the following CAA elements or portions thereof: 110(a)(2)(A), (B), (C) (for enforcement and regulation of minor sources), (D)(i)(I), (D)(i)(II) (for the visibility protection portion), (D)(ii), (E)(i), (E)(iii), (F), (G), (H), (J), (K), (L), and (M). 3/9/12 2/25/14, 79 FR 10377 This action addresses the PSD related elements of the following CAA requirements: 110(a)(2)(C), (D)(i)(II), and (J). 12/22/14 4/2/15, 80 FR 17695 Docket #2015-0040. Addresses CAA element 110(a)(2)(E)(ii). Regional Haze Plan Statewide 10/4/10 6/13/12, 77 FR 35287 § 52.2452(d); Limited Approval. Regional Haze Plan Supplements and BART determinations: Statewide 6/13/12, 77 FR 35287 § 52.2452(d); Limited Approval. 1. Georgia Pacific Corporation; 7/17/08. 2a. MeadWestvaco Corporation; 5/6/11. b. MeadWestvaco Corporation; 3/6/09. 3. O-N Minerals Facility; 1/14/10. 4. Revision to the O-N Minerals Facility permit 11/19/10. 2002 Base Year Emissions Inventory for the 1997 fine particulate matter (PM2.5) standard Virginia portion of the Washington DC-MD-VA 1997 PM2.5 nonattainment area 4/4/08 10/4/12, 77 FR 60626 § 52.2425(f). Section 110(a)(2) Infrastructure Requirements for the 2010 Nitrogen Dioxide NAAQS Statewide 5/30/13 3/18/14, 79 FR 15012 Docket #2013-0510. This action addresses the following CAA elements, or portions thereof: 110(a)(2)(A), (B), (C), (D)(i)(II), (D)(ii), (E)(i), (E)(iii), (F), (G), (H), (J), (K), (L), and (M) with the exception of PSD elements. 5/30/13 9/30/14, 79 FR 58686 Docket #2013-0510. This action addresses the following CAA elements, or portions thereof: 110(a)(2)(C), (D)(i)(II), and (J) with respect to the PSD elements. 12/22/14 4/2/15, 80 FR 17695 Docket #2015-0040. Addresses CAA element 110(a)(2)(E)(ii). Section 110(a)(2) Infrastructure Requirements for the 2008 Ozone NAAQS Statewide 7/23/12 3/27/14, 79 FR 17043 Docket #2013-0211. This action addresses the following CAA elements, or portions thereof: 110(a)(2)(A), (B), (C), (D)(i)(II), (D)(ii), (E)(i), (E)(iii), (F), (G), (H), (J), (K), (L), and (M) with the exception of PSD elements. 7/23/12 9/30/14, 79 FR 58686 Docket #2013-0211. This action addresses the following CAA elements, or portions thereof: 110(a)(2)(C), (D)(i)(II), and (J) with respect to the PSD elements. 12/22/14 4/2/15, 80 FR 17695 Docket #2015-0040. Addresses CAA element 110(a)(2)(E)(ii). Regional Haze Five-Year Progress Report Statewide 11/8/13 5/2/14, 79 FR 25019. Maintenance plan for the Virginia Portion of the Washington, DC-MD-VA Nonattainment Area for the 1997 Annual PM2.5 National Ambient Air Quality Standard Statewide 06/03/13, 07/17/13 10/6/14,79 FR 60081 See § 52.2429(b). Section 110(a)(2) Infrastructure Requirements for the 2010 Sulfur Dioxide NAAQS Statewide 6/18/14 3/4/15, 80 FR 11557 Docket #2014-0522. This action addresses the following CAA elements, or portions thereof: 110(a)(2) (A), (B), (C), (D)(i)(II) (PSD), (D)(ii), (E)(i), (E)(iii), (F), (G), (H), (J) (consultation, notification, and PSD), (K), (L), and (M). 12/22/14 4/2/15, 80 FR 17695 Docket #2015-0040. Addresses CAA element 110(a)(2)(E)(ii). Attainment Demonstration Contingency Measure Plan Washington, DC-MD-VA 1997 8-Hour Ozone Nonattainment Area June 12, 2007 4/10/15, 80 FR 19219 2010 motor vehicle emissions budgets of 144.3 tons per day (tpd) NOX. 8-hour Ozone Modeled Demonstration of Attainment and Attainment Plan for the 1997 Ozone National Ambient Air Quality Standards Washington, DC-MD-VA 1997 8-Hour Ozone Nonattainment Area 6/12/07 4/10/15, 80 FR 19206 2009 motor vehicle emissions budgets of 66.5 tons per day (tpd) for VOC and 146.1 tpd of NOX. 3/18/14 5/26/15, 80 FR 29963 Removal of Stage II vapor recovery program. See section 52.2428. 2011 Base Year Emissions Inventory for the 2008 8-hour ozone standard Virginia portion of the Washington, DC-MD-VA 2008 ozone nonattainment area 7/17/14 5/13/15, 80 FR 27258 § 52.2425(g). Section 110(a)(2) Infrastructure Requirements for the 2012 Particulate Matter NAAQS Statewide 7/16/15 6/16/16, 81 FR 39210 Docket #2015-0838. This action addresses the following CAA elements, or portions thereof: 110(a)(2)(A), (B), (C), (D)(i)(II) (PSD), (D)(ii), (E), (F), (G), (H), (J), (K), (L), and (M).

    (2) Documents incorporated by reference in regulation 9VAC5-20-21.

    Revised paragraph in
  • regulation 5-20-21
  • Applicable geographic area State submittal date EPA approval date Additional explanation
    9VAC5-60-100 (adopts 40 CFR 63.460 through 63.469 by reference) Statewide 10/9/98 11/3/99, 64 FR 59648 52.2423(q). 9VAC5-20-21, paragraphs E.1 through E.5 and E.7 Statewide 4/12/89 8/23/95, 60 FR 43714 52.2423(m); Originally Appendix M, Sections II.A. through II.E. and II.G. 9VAC5-20-21, paragraphs E.1 and E.2 Statewide 2/12/93 8/23/95, 60 FR 43714 52.2423(n); Originally Appendix M, Sections II.A. and II.B. 9VAC5-20-21, Section E Statewide 6/22/99 1/7/03, 68 FR 663 52.2423(r). 9VAC5-20-21, paragraph E.12 Statewide 2/23/04 6/8/04, 69 FR 31893 52.2423(s). 9VAC5-20-21, Section E Northern Virginia VOC Emissions Control Area designated in 9VAC5-20-206 3/24/04 5/12/05, 70 FR 24970 9VAC5-20-21, Sections E.1.a.(7)., E.4.a.(12) through a.(17), E.10., E.11., E.13.a.(1), and E.13.a.(2). 9VAC5-20-21, Sections D and E Statewide 8/25/05 3/3/06, 71 FR 10838 Sections D., E. (introductory sentence), E.2 (all paragraphs), E.3.b, E.4.a.(1) and (2), E.4.b. , E.5. (all paragraphs), and E.7. (all paragraphs) State effective date is 2/1/00. 9VAC5-20-21, Section B Statewide 10/25/05 3/3/06, 71 FR 10838 State effective date is 3/9/05; approval is for those provisions of the CFR which implement control programs for air pollutants related to the national ambient air quality standards (NAAQS) and regional haze. 9VAC5-20-21, Section E Northern Virginia VOC Emissions Control Area designated in 9VAC5-20-206 10/25/05 1/30/07, 72FR 4207 9VAC5-20-21, Sections .1.a.(16)., E.4.a.(18) through a.(20), E.6.a, E.11.a.(3), E.12.a.(5) through a.(8), E.14.a. and E.14.b.
  • State effective date is 3/9/05.
  • 9VAC5-20-21, Paragraphs E.4.a. (21) and (22) Fredericksburg VOC Emissions Control Area Designated in 9VAC5-20-206 5/14/07 12/5/07, 72 FR 68511 State effective date is 10/4/06. 9VAC5-20-21, Sections B. and E.1 Statewide 6/24/09 1/18/11, 76 FR 2829 Revised sections. 9VAC5-20-21, Sections E.1.a.(1)(q) and E.1.a.(1)(r) Statewide 9/27/10 4/25/11, 76 FR 22814 Revised sections. 9VAC5-20-21, Section E.1.a.(1)(s) Statewide 8/18/10 6/22/11, 76 FR 36326 Added Section. 9VAC5-20-21, Sections E.1.a.(2), (16)-(19), E.2.a.(3), E.2.b., E.4.a.(23)-(27), E.11.a.(4)-(6), E.12.a.(3), (5) and (9)-(11) Northern Virginia and Fredericksburg VOC Emissions Control Areas 3/17/10 1/26/12, 77 FR 3928 Added section. 9VAC5-20-21 Section E.1.a(1) Documents Incorporated by Reference Statewide 5/25/11 2/3/12, 77 FR 5400 Addition of paragraph (1)(a) and (1) (u). The citations of all other paragraphs are revised. Documents incorporated by reference Northern Virginia VOC emissions control area 02/01/16 10/21/16, 81 FR 72711 Section 15 added.
    [FR Doc. 2017-10909 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2016-0238; FRL-9962-73-Region 3] Approval and Promulgation of Air Quality Implementation Plans; Maryland; Control of Nitrogen Oxide Emissions From Coal-Fired Electric Generating Units AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving a state implementation plan (SIP) revision submitted by the State of Maryland. The revision consists of a Maryland regulation that regulates nitrogen oxides (NOX) emissions from coal-fired electric generating units (EGUs) in the State. EPA is approving this revision in accordance with the requirements of the Clean Air Act (CAA).

    DATES:

    This final rule is effective on June 29, 2017.

    ADDRESSES:

    EPA has established a docket for this action under Docket ID Number EPA-R03-OAR-2016-0238. All documents in the docket are listed on the https://www.regulations.gov Web site. Although listed in the index, some information is not publicly available, e.g., confidential business information (CBI) or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available through https://www.regulations.gov, or please contact the person identified in the FOR FURTHER INFORMATION CONTACT section for additional availability information.

    FOR FURTHER INFORMATION CONTACT:

    Marilyn Powers, (215) 814-2308, or by email at [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Background

    On January 11, 2017 (82 FR 3233), EPA published a notice of proposed rulemaking (NPR) for the State of Maryland. In the NPR, EPA proposed approval of a Maryland regulation to control emissions of NOX from coal fired EGUs. The formal SIP revision (#15-06) was submitted by the Maryland Department of the Environment (MDE) on November 20, 2015. On September 8, 2016, MDE provided a letter to EPA to clarify that the November 20, 2015 submission was submitted as a SIP strengthening measure and not as a submission to address reasonably available control technology (RACT) requirements for coal-fired EGUs.

    As noted in the NPR, this action pertains only to the changes to COMAR 26.11.38 that were submitted by MDE on November 20, 2015 with a State effective date of August 31, 2015, namely COMAR 26.11.38.01-.05. Subsequent revisions and amendments to this regulation have been made by MDE, but have not yet been submitted to EPA for incorporation into the Maryland SIP.

    II. Summary of SIP Revision

    The revision consists of Maryland regulation COMAR 26.11.38—Control of NOX Emissions from Coal-Fired Electric Generating Units (effective August 31, 2015). The regulation establishes NOX emissions standards for 14 EGUs at 7 coal-fired power plants, and requires an affected EGU to minimize NOX emissions by operating and optimizing the use of all installed pollution controls and combustion controls during all times that the unit is in operation while burning coal. Additional monitoring and recordkeeping are required to demonstrate compliance with these requirements, and the owner or operator is required to submit a plan to MDE and to EPA for approval, which summarizes the data to be collected and make a showing that each affected EGU is operating its installed controls. Other specific requirements of COMAR 26.11.38 and the rationale supporting EPA's proposed rulemaking action are explained in the NPR and Technical Support Document (TSD) supporting EPA's analysis for approval of Maryland's regulation into the SIP and will not be restated here. The NPR and TSD are available in the docket for this rulemaking at https://www.regulations.gov, Docket ID Number EPA-R03-OAR-2016-0238.

    III. Public Comments and EPA's Responses

    EPA received two anonymous comments on the January 11, 2017 proposed approval of COMAR 26.11.38 for the Maryland SIP.

    Comment 1: One commenter expressed support for strengthening the NOX emissions limits in Maryland.

    Response 1: EPA thanks the commenter for the submitted statement.

    Comment 2: Another commenter expressed support for the proposed rulemaking as a SIP strengthening measure needed to reduce pollution and to meet the requirements of the national ambient air quality standards (NAAQS) “to keep the air clean.” However, the commenter also stated, “This regulation was submitted as a SIP strengthening measure which seems to be necessary because of how it does not include nitrogen oxides (NOX) emissions from seven coal-fired electric generating units which is a great amount.” The commenter also stated it is an important measure to regulate clean air in “already polluted skies” and acknowledged this regulation was SIP strengthening and was not submitted to meet RACT requirements.

    Response 2: EPA thanks the commenter for supporting our approval of the Maryland regulation into the State's SIP. EPA notes that the commenter is incorrect in stating that COMAR 26.11.38, entitled “Control of Nitrogen Oxides Emissions from Coal Fired Electric Generating Units,” does not apply to NOX emissions from seven coal-fired EGUs. The language of COMAR 26.11.38 specifically contains NOX limitations for these EGUs as well as other control measures related to NOX emissions ass discussed in the NPR and TSD. As EPA discussed in the NPR, because NOX is a precursor to ozone formation, the NOX limitations and measures for these EGUs identified in COMAR 26.11.38 will reduce NOX emissions and ozone formation in Maryland which should assist Maryland with attaining and maintaining the ozone NAAQS. Finally, the commenter correctly acknowledged that Maryland had not submitted COMAR 26.11.38 for SIP inclusion to address any RACT requirements which Maryland confirmed with its September 8, 2016 letter to EPA. The September 8, 2016 letter is available in the docket for this rulemaking. EPA expects subsequent rulemaking action on Maryland's obligations for RACT under the 2008 ozone NAAQS.

    III. Final Action

    EPA is approving Maryland regulation COMAR 26.11.38, submitted in the November 20, 2015 SIP submission, which has a state effective date of August 31, 2015, as a revision to the Maryland SIP as a SIP strengthening measure in accordance with section 110 of the CAA. COMAR 26.11.38.01-.05 imposes NOX emissions limits on coal fired EGUs subject to the regulation, and EPA expects the regulation will lower NOX emissions within the State which should reduce ozone formation. The NOX emissions limits plus the operation and optimization of the existing NOX controls whenever the units are in operation strengthens the Maryland SIP and will help the State's attainment and maintenance of the ozone NAAQS.

    IV. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of Maryland regulation COMAR 26.11.38.01-.05 described in the amendments to 40 CFR part 52 set forth below. Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.1 EPA has made, and will continue to make, these materials generally available through http://www.regulations.gov and/or at the EPA Region III Office (please contact the person identified in the “For Further Information Contact” section of this preamble for more information).

    1 62 FR 27968 (May 22, 1997).

    V. Statutory and Executive Order Reviews A. General Requirements

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law. B. Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    C. Petitions for Judicial Review

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 31, 2017. 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 Maryland regulation COMAR 26.11.38 into the Maryland SIP may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Nitrogen dioxide, Ozone, Reporting and recordkeeping requirement.

    Dated: May 5, 2017. Cecil Rodrigues, Acting Regional Administrator, Region III.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart V—Maryland 2. In § 52.1070, the table in paragraph (c) is amended by adding the heading “26.11.38 Control of Nitrogen Oxide Emissions from Coal-Fired Electric Generating Units” and the entries “26.11.38.01 through 26.11.38.05” in numerical order to read as follows:
    § 52.1070 Identification of plan.

    (c) * * *

    EPA-Approved Regulations, Technical Memoranda, And Statutes In The Maryland Sip Code of Maryland
  • Administrative
  • Regulations (COMAR) citation
  • Title/subject State
  • effective
  • date
  • EPA approval date Additional explanation/
  • citation at 40 CFR 52.1100
  • *         *         *         *         *         *         * 26.11.38 Control of Nitrogen Oxide Emissions From Coal-Fired Electric Generating Units 26.11.38.01 Definitions 8/31/2015 5/30/2017 [Insert Federal Register citation] 26.11.38.02 Applicability 8/31/2015 5/30/2017 [Insert Federal Register citation] 26.11.38.03 2015 NOX Emission Control Requirements 8/31/2015 5/30/2017 [Insert Federal Register citation] 26.11.38.04 Compliance Demonstration Requirements 8/31/2015 5/30/2017 [Insert Federal Register citation] 26.11.38.05 Reporting Requirements 8/31/2015 5/30/2017 [Insert Federal Register citation] *         *         *         *         *         *         *
    [FR Doc. 2017-10912 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [MD 204-3120; FRL-9959-24-Region 3] Air Plan Approval; Maryland; Update to Materials Incorporated by Reference AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule; administrative change.

    SUMMARY:

    The Environmental Protection Agency (EPA) is updating the materials that are incorporated by reference (IBR) into the Maryland state implementation plan (SIP). The regulations affected by this update have been previously submitted by the Maryland Department of the Environment (MDE) and approved by EPA. This update affects the SIP materials that are available for public inspection at the National Archives and Records Administration (NARA) and the EPA Regional Office.

    DATES:

    This action is effective May 30, 2017.

    ADDRESSES:

    SIP materials which are incorporated by reference into 40 CFR part 52 are available for inspection at the following locations: Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103; or NARA. For information on the availability of this material at NARA, call 202-741-6030, or go to: http://www.archives.gov/federal_register/code_of_federal_regulations/ibr_locations.html.

    FOR FURTHER INFORMATION CONTACT:

    Sharon McCauley, (215) 814-3376, or by email at [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Background

    The SIP is a living document which a state revises as necessary to address its unique air pollution problems. Therefore, EPA, from time to time, must take action on SIP revisions containing new and/or revised regulations as being part of the SIP. On May 22, 1997 (62 FR 27968), EPA revised the procedures for incorporating by reference federally-approved SIPs, as a result of consultations between EPA and the Office of the Federal Register (OFR). The description of the revised SIP document, IBR procedures and “Identification of plan” format are discussed in further detail in the May 22, 1997 Federal Register document. On November 29, 2004 (69 FR 69304), EPA published a document in the Federal Register beginning the new IBR procedure for Maryland. On February 2, 2006 (71 FR 5607), May 18, 2007 (72 FR 27957), March 11, 2008 (73 FR 12895), March 19, 2009 (74 FR 11647), and August 22, 2011 (76 FR 52278), EPA published updates to the IBR material for Maryland.

    Since the publication of the last IBR update, EPA has approved the following regulatory changes to the following regulations, statutes, and source-specific actions for Maryland:

    A. Added

    1. COMAR 26.11.09.10 (Requirements to Burn Used Oil and Waste Combustible Fluid as Fuel).

    2. COMAR 26.11.09.12 (Standards for Biomass Fuel-Burning Equipment Equal to or Greater Than 350,000 Btu/hr).

    3. COMAR 26.11.17.06 through .09 (Requirements for New Sources and Modifications).

    4. COMAR 26.11.19.07-2 (Plastic Parts and Business Machines Coating).

    5. COMAR 26.11.19.27-1 (Control of Volatile Organic Compounds from Pleasure Craft Coating Operations).

    6. COMAR 26.11.26.01, 26.11.26.04 through .09 (Conformity).

    7. COMAR 26.11.34.01 through .14 (Low Emissions Vehicle Program).

    8. COMAR 26.11.35.01 through .07 (Volatile Organic Compounds from Adhesives and Sealants).

    9. COMAR 20.79.01.01 (part), .02 (part), and .06 (Applications Concerning the Construction or Modification of Generating Stations and Overhead Transmission Lines—General).

    10. COMAR 20.79.02.01 through 20.79.02.03 (Applications Concerning the Construction or Modification of Generating Stations and Overhead Transmission Lines—Administrative Provisions).

    11. COMAR 20.79.03.01 and 20.79.03.02 (part) (Applications Concerning the Construction or Modification of Generating Stations and Overhead Transmission Lines—Details of Filing Requirements—Generating Stations).

    12. Public Utility Companies Article of the Annotated Code of Maryland, sections 7-205, 7-207 (part), 7-207.1 (part), and 7-208.

    13. Annotated Code of Maryland, title 15 (Public Ethics) which was also removed and replaced (see section C of this rulemaking).

    14. Annotated Code of Maryland, section 5-101 (a),(e),(f), (g)(1) and (2), (h), (i), (j), (m), (n), (p), (s), (t), (bb), (ff), (gg), (ll) (Definitions), section 5-103(a) through (c) (Designation of Individuals as Public Officials, section 5-208(a) (Determination of Public Official in Executive agency), section 5-501(a) and (c) (Restrictions on Participation), section 5-601(a) (Individuals Required to File Statement), section 5-602(a) (Financial Disclosure Statement—Filing Requirements), section 5-606(a) (Public Records), section 5-607(a) through (j) (Content of statements), and section 5-608(a) through (c) (Interests Attributable to Individual Filing Statement).

    15. In 40 CFR 52.1070(d), a source specific requirement was added for the GenOn Chalk Point Generating Station—2011 Consent Decree for Chalk Point.

    B. Revised

    1. COMAR 26.11.01.01 (Definitions).

    2. COMAR 26.11.01.04 (Testing and Monitoring).

    3. COMAR 26.11.02.01 (Definitions), .09 (Sources Subject to Permits to Construct), .10 (Sources Exempt from Permits to Construct and Approvals), and .12 (Procedures for Obtaining Approvals of PSD Sources and NSR Sources, Permits to Construct, Permit to Construct MACT Determinations On a Case-by-Case Basis in Accordance with 40 CFR part 63, subpart B, and Certain 100-Ton Sources).

    4. COMAR 26.11.04.02 (Ambient Air Quality Standards, Definitions, Reference Conditions, and Methods of Measurement).

    5. COMAR 26.11.06.14 (Control of PSD Sources).

    6. COMAR 26.11.09.01 (Definitions), .04 (Prohibition of Certain New Fuel Burning Equipment), .06 (Control of Particulate Matter), .07 (Control of Sulfur Oxides from Fuel Burning Equipment), and .09 (Tables and Diagrams).

    7. COMAR 26.11.10.03 (Visible Emissions).

    8. COMAR 26.11.13.04 (Loading Operations) and .05 (Gasoline Leaks from Tank Trucks).

    9. COMAR 26.11.17.01 (Definitions), .02 (Applicability), .03 (General Conditions), .04 (Creating Emission Reduction Credits (ERCs)), .05 (Information on Emission Reductions and Certification).

    10. The following regulations in COMAR 26.11.19 (Volatile Organic Compounds from Specific Processes):

    a. COMAR 26.11.19.02 (Applicability, Determining Compliance, Reporting, and General Requirements).

    b. COMAR 26.11.19.07 (Paper, Fabric, Film, and Foil Coating).

    c. COMAR 26.11.19.08 (Metal Parts and Products Coating).

    d. COMAR 26.11.19.11 (Lithographic and Letterpress Printing).

    e. COMAR 26.11.19.13 (Drum and Pail Coating).

    f. COMAR 26.11.19.15 (Paint, Resin, and Adhesive Manufacturing and Adhesive and Sealant Applications).

    g. COMAR 26.11.19.23 (Control of VOC Emissions from Vehicle Refinishing).

    h. COMAR 26.11.19.30 (Control of Volatile Organic Compounds from Chemical Production and Flouropolymer Material Installations).

    11. COMAR 26.11.26.01 (Purpose), .02 (Definitions) and .03 (Transportation Conformity).

    12. COMAR 26.11.34.01 (Purpose), .02 (Incorporation by Reference), .03 (Applicability and Exemptions, .04 (Definitions), .05 (Emission Requirements), .06 (Fleet Average NMOG Credit Account Balances), .07 (Initial NMOG Credit Account Balances), .08 (Fleet Average Greenhouse Gas Requirements), .09 (Zero Emission Vehicle (ZEV) Requirements), .10 (Initial ZEV Credit Account Balances), .11 (Vehicle Testing), .12 (Warranty), .13 (Manufacturer Compliance Demonstration), and .14 (Enforcement).

    C. Removed

    1. COMAR 26.11.04.03 through .09 (State Ambient Air Quality Standards).

    2. Annotated Code of Maryland, title 15 (Public Ethics).

    3. Consent orders and/or consent decrees for Potomac Electric Power Company (PEPCO)—Chalk Point Units #1 and #2, Beall Junior/Senior High School, Mt. Saint Mary's College, and Maryland Slag Co.

    II. EPA Action

    In this action, EPA is announcing the update to the IBR material as of July 1, 2016 and revising the text within 40 CFR 52.1070(b).

    EPA is revising our 40 CFR part 52 “Identification of Plan” for the State of Maryland regarding incorporation by reference, § 52.1070(b). EPA is revising § 52.1070(b)(1) to clarify that all SIP revisions listed in paragraphs (c) and (d), regardless of inclusion in the most recent “update to the SIP compilation,” are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking in which EPA approved the SIP revision, consistent with following our “Approval and Promulgations of Air Quality Implementation Plans; Revised Format of 40 CFR part 52 for Materials Being Incorporated by Reference,” effective May 22, 1997 (62 FR 27968). EPA is revising § 52.1070(b)(2) to clarify references to other portions of paragraph (b) with paragraph (b)(2). EPA is revising paragraph (b)(3) to update address and contact information.

    In the table for 40 CFR 52.1070(c):

    1. Revising the Federal Register date for COMAR 26.11.10.03.

    2. Adding a Federal Register entry for COMAR 26.11.19.09-1 which is currently not shown in the Code of Federal Regulations but was previously approved by EPA on February 22, 2011 at 76 FR 9656.

    3. Revising the title of the State Government Article of the Annotated Code of Maryland to read, “General Provisions Article of the Annotated Code of Maryland (formerly cited at Section 15 of State Government Article).”

    In the table for 40 CFR 52.1070(d):

    1. Restoring an entry for PEPCO—Dickerson which was inadvertently removed from the table during a prior final rulemaking action.

    2. Revising an incorrect Federal Register page citation in the “EPA approval date” column for the Northeast Maryland Waste Disposal Authority and Wheelabrator-Frye, Inc. and the Mayor and City Council of Baltimore and BEDCO Development Corp.

    3. Reorganizing the table so that the entries appear in the order which EPA's approval actions occurred.

    III. Good Cause Exemption

    EPA has determined that this rule falls under the “good cause” exemption in section 553(b)(3)(B) of the Administrative Procedures Act (APA) which, upon finding “good cause,” authorizes agencies to dispense with public participation and section 553(d)(3) which allows an agency to make a rule effective immediately (thereby avoiding the 30-day delayed effective date otherwise provided for in the APA). This rule simply codifies provisions which are already in effect as a matter of law in federal and approved state programs. Under section 553 of the APA, an agency may find good cause where procedures are “impractical, unnecessary, or contrary to the public interest.” Public comment is “unnecessary” and “contrary to the public interest” since the codification only reflects existing law. Immediate notice in the CFR benefits the public by removing outdated citations and incorrect table entries.

    IV. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of previously EPA approved regulations promulgated by the State of Maryland and federally effective prior to July 1, 2016. Therefore, these materials have been approved by EPA for inclusion in the SIP, have been incorporated by reference by EPA into that plan, are fully federally enforceable under sections 110 and 113 of the CAA as of the effective date of the final rulemaking of EPA's approval, and will be incorporated by reference by the Director of the Federal Register in the next update to the SIP compilation.1 EPA has made, and will continue to make, these materials generally available through www.regulations.gov and/or at the EPA Region III Office (please contact the person identified in the For Further Information Contact section of this preamble for more information).

    1 62 FR 27968 (May 22, 1997).

    V. Statutory and Executive Order Reviews A. General Requirements

    Under the Clean Air Act (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 Order 12866 (58 FR 51735, October 4, 1993);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the SIP is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

    B. Submission to Congress and the Comptroller General

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This rule is not a “major rule” as defined by 5 U.S.C. 804(2).

    C. Petitions for Judicial Review

    EPA has also determined that the provisions of section 307(b)(1) of the CAA pertaining to petitions for judicial review are not applicable to this action. Prior EPA rulemaking actions for each individual component of the Maryland SIP compilations had previously afforded interested parties the opportunity to file a petition for judicial review in the United States Court of Appeals for the appropriate circuit within 60 days of such rulemaking action. Thus, EPA sees no need in this action to reopen the 60-day period for filing such petitions for judicial review for this “Identification of plan” update action for Maryland.

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: January 18, 2017. Cecil Rodrigues, Acting Regional Administrator, Region III.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart V—Maryland 2. Section 52.1070 is amended by: a. Revising paragraph (b). b. In paragraph (c): i. Revising the entry for COMAR 26.11.10.03; ii. Adding an entry in numerical order for COMAR 26.11.19.09-1; and iii. Removing the heading “State Government Article of the Annotated Code of Maryland” and adding in its place the heading “General Provisions Article of the Annotated Code of Maryland (formerly cited at Section 15 of State Government Article)”. c. In paragraph (d): i. Adding an entry for Potomac Electric Power Company (PEPCO)—Dickerson as the first entry of the table; ii. Revising the entry for the Northeast Maryland Waste Disposal Authority and Wheelabrator-Frye, Inc. and the Mayor and City Council of Baltimore and BEDCO Development Corp; and iii. Removing the entry for GenOn Chalk Point Generating Station from the beginning of the table and adding an entry for GenOn Chalk Point Generating Station to the end of the table.

    The revisions and additions read as follows:

    § 52.1070 Identification of plan.

    (b) Incorporation by reference. (1) Material listed in paragraphs (c) and (d) of this section with an EPA approval date prior to July 1, 2016, was approved for incorporation by reference by the Director of the Federal Register in accordance with 5 U.S.C. 552(a) and 1 CFR part 51. Entries in paragraphs (c) and (d) of this section with the EPA approval dates after July 1, 2016 for the State of Maryland, have been approved by EPA for inclusion in the state implementation plan and for incorporation by reference into the plan as it is contained in this section, and will be considered by the Director of the Federal Register for approval in the next update to the SIP compilation.

    (2) EPA Region III certifies that the following materials provided by EPA at the addresses in paragraph (b)(3) of this section are an exact duplicate of the officially promulgated state rules/regulations which have been approved as part of the state implementation plan as of the dates referenced in paragraph (b)(1) of this section.

    (3) Copies of the materials incorporated by reference into the state implementation plan may be inspected at the Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. To obtain the material, please call the Regional Office at (215) 814-3376. You may also inspect the material with an EPA approval date prior to July 1, 2016 for the State of Maryland at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

    (c) * * *

    EPA-Approved Regulations, Technical Memoranda, and Statutes in the Maryland SIP Code of Maryland
  • Administrative
  • Regulations (COMAR) citation
  • Title/subject State effective date EPA approval date Additional
  • explanation/citation
  • at 40 CFR 52.1100
  • *         *         *         *         *         *         * 26.11.10 Control of Iron and Steel Production Installations *         *         *         *         *         *         * 26.11.10.03 Visible Emissions 6/29/09 7/27/12, 77 FR 44146 Revised paragraphs A. and D. of 26.11.10.03 for Sintering Plants. *         *         *         *         *         *         * 26.11.19 Volatile Organic Compounds From Specific Processes *         *         *         *         *         *         * 26.11.19.09-1 Control of VOC Emissions from Industrial Solvent Cleaning Operations Other Than Cold and Vapor Degreasing. 4/19/10 2/22/11, 76 FR 9656 New Regulation. *         *         *         *         *         *         *

    (d) * * *

    Name of source Permit number/type State effective date EPA approval date Additional explanation Potomac Electric Power Company (PEPCO)—Dickerson #49352 Amended Consent Order 7/26/78 12/6/79, 44 FR 70141 52.1100(c)(25). *         *         *         *         *         *         * Northeast Maryland Waste Disposal Authority and Wheelabrator-Frye, Inc. and the Mayor and City Council of Baltimore and BEDCO Development Corp Secretarial Order 2/25/83 8/24/83, 48 FR 38465 52.1100(c)(70) (Shutdown of landfill for offsets). *         *         *         *         *         *         * GenOn Chalk Point Generating Station The 2011 Consent Decree for Chalk Point 3/10/11 5/4/12, 77 FR 26438 Docket No. 52.1070(d). The SIP approval includes specific provisions of the 2011 Consent Decree for which the State of Maryland requested approval on October 12, 2011.
    [FR Doc. 2017-10915 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 52 and 81 [EPA-R05-OAR-2016-0137; FRL-9962-70-Region 5] Air Plan Approval; Indiana; Redesignation of the Muncie Area to Attainment of the 2008 Lead Standard AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Direct final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving the April 14, 2016, request from the Indiana Department of Environmental Management (Indiana) to redesignate the Muncie nonattainment area to attainment for the 2008 national ambient air quality standards (NAAQS or standards) for lead. EPA is also approving the state's plan for maintaining the 2008 lead NAAQS through 2030 for the area and the 2013 attainment year emissions inventory for the area. EPA is approving these actions in accordance with the Clean Air Act (CAA) and EPA's implementation regulations regarding the 2008 lead NAAQS.

    DATES:

    This direct final rule will be effective July 31, 2017, unless EPA receives adverse comments by June 29, 2017. If adverse comments are received, EPA will publish a timely withdrawal of the direct final rule in the Federal Register informing the public that the rule will not take effect.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R05-OAR-2016-0137 at http://www.regulations.gov or via email to [email protected] For comments submitted at Regulations.gov, follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. For either manner of submission, EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. EPA will generally not consider comments or comment contents located outside of the primary submission (i.e., on the web, cloud, or other file sharing system). For additional submission methods, please contact the person identified in the For Further Information Contact section. For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    Anthony Maietta, Environmental Protection Specialist, Control Strategies Section, Air Programs Branch (AR-18J), Environmental Protection Agency, Region 5, 77 West Jackson Boulevard, Chicago, Illinois 60604, (312) 353-8777, [email protected]

    SUPPLEMENTARY INFORMATION:

    Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA. This supplementary information section is arranged as follows:

    I. Why is EPA concerned about lead? II. What is the background for these actions? III. What are the criteria for redesignation to attainment? IV. What is EPA's analysis of the state's request? (A) Attainment Determination and Redesignation (B) Indiana Has a Fully Approved Maintenance Plan Pursuant to Section 175A of the CAA (Section 107(d)(3)(E)(iv)) (C) Comprehensive Emissions Inventory V. What action is EPA taking? VI. Statutory and Executive Order Reviews I. Why is EPA concerned about lead?

    Lead is a metal found naturally in the environment as well as in manufactured products. However, lead has serious public health effects and depending on the level of exposure can adversely affect the nervous system, kidney function, immune system, reproductive and developmental systems and the cardiovascular system. Today, the highest levels of lead in the air are usually found near lead smelters. In the Muncie area the only source of lead emissions is Exide Technologies, whose facility houses a lead smelter that processes used batteries and other metal waste products.

    II. What is the background for these actions?

    On November 12, 2008 (73 FR 66964), EPA revised the primary and secondary lead NAAQS from 1.5 micrograms per cubic meter (μg/m3) to 0.15 μg/m3 based on a maximum arithmetic three-month mean concentration for a three-year period. See 40 CFR 50.16. On November 22, 2010 (75 FR 71033), EPA published air quality designations and classifications for the 2008 lead NAAQS based upon air quality monitoring data for calendar years 2007-2009. These designations became effective on December 31, 2010. The Muncie area was designated nonattainment for the 2008 lead NAAQS. See 40 CFR 81.336. IDEM submitted their redesignation request on April 14, 2016.

    III. What are the criteria for redesignation to attainment?

    The CAA sets forth the requirements for redesignating a nonattainment area to attainment. Specifically, section 107(d)(3)(E) of the CAA authorizes EPA to redesignate an area provided that: (1) The Administrator determines that the area has attained the applicable NAAQS based on current air quality data; (2) the Administrator has fully approved an applicable state implementation plan (SIP) for the area under section 110(k) of the CAA; (3) the Administrator determines that the improvement in air quality is due to permanent and enforceable emission reductions resulting from implementation of the applicable SIP, Federal air pollution control regulations, or other permanent and enforceable emission reductions; (4) the Administrator has fully approved a maintenance plan for the area meeting the requirements of section 175A of the CAA; and (5) the state containing the area has met all requirements applicable to the area for purposes of redesignation under section 110 and part D of the CAA.

    IV. What is EPA's analysis of the state's request?

    EPA is approving the redesignation of the Muncie area to attainment of the 2008 lead NAAQS, as well as Indiana's maintenance plan and emissions inventory for the area. The bases for these actions follow.

    (A) Attainment Determination and Redesignation 1. The Area Has Attained the 2008 Lead NAAQS (Section 107(d)(3)(E)(i))

    In accordance with section 107(d)(3)(E)(i) of the CAA, 42 U.S.C. 7407, EPA is determining that the Muncie, Indiana area has attained the 2008 lead NAAQS. EPA has reviewed the ambient air monitoring data for the Muncie area in accordance with the provisions of 40 CFR part 50, appendix R. All data considered are complete, quality-assured, certified, and recorded in EPA's Air Quality System database. This review addresses air quality data collected in the 2013-2015 period, which are the most recent quality-assured data available. Our determination that the Muncie area has attained the 2008 lead NAAQS is based upon data for the 2013-2015 monitoring period that show this area has monitored attainment of the lead NAAQS.

    Under EPA regulations at 40 CFR 50.16, the 2008 primary and secondary lead standards are met when the maximum arithmetic three-month mean concentration for a three-year period, as determined in accordance with 40 CFR part 50, appendix R, is less than or equal to 0.15 μg/m3 at all relevant monitoring sites in the subject area. As shown in Table 1, Indiana provided EPA with three years of monitoring data showing that the three-month rolling average design values for the Muncie lead monitor were all below the 2008 lead standard.

    Table 1—Three-Month Rolling Average Design Values for the Muncie Lead Nonattainment Area Location 3-month period 2013 2014 2015 Muncie—Mt. Pleasant Boulevard Nov-Jan 1
  • Dec-Feb
  • 0.05 μg/m3
  • 0.06 μg/m3
  • 0.03 μg/m3
  • 0.04 μg/m3
  • 0.03 μg/m3
  • 0.03 μg/m3
  • Jan-Mar 0.04 μg/m3 0.04 μg/m3 0.04 μg/m3 Feb-Apr 0.03 μg/m3 0.04 μg/m3 0.05 μg/m3 Mar-May 0.03 μg/m3 0.04 μg/m3 0.06 μg/m3 Apr-Jun 0.03 μg/m3 0.05 μg/m3 0.06 μg/m3 May-July 0.03 μg/m3 0.05 μg/m3 0.06 μg/m3 Jun-Aug 0.04 μg/m3 0.06 μg/m3 0.05 μg/m3 July-Sept 0.04 μg/m3 0.03 μg/m3 0.03 μg/m3 Aug-Oct 0.05 μg/m3 0.03 μg/m3 0.04 μg/m3 Sept-Nov 0.04 μg/m3 0.03 μg/m3 0.04 μg/m3 Oct-Dec 0.04 μg/m3 0.03 μg/m3 0.11 μg/m3 1 When calculating a three-month rolling average, the first two data points, November through January for 2013 and December through February of 2013, would additionally use data from November and December of 2012.

    The data from 2013-2015 are still the most recent quality-assured and certified data for the Muncie area. Indiana indicated that it will continue to use and maintain the Muncie lead monitor to determine whether the area continues to attain the standard. The 2013-2015 data show that the maximum value for the three-year period was 0.11 μg/m3, with monitored lead values generally at or below 0.05 μg/m3. EPA's review of these data indicates that the Muncie area has attained and continues to attain the 2008 lead NAAQS, with a design value of 0.11 μg/m3 for the period of 2013-2015.

    2. The Area Has Met All Applicable Requirements Under Section 110 and Part D and Has a Fully Approved SIP Under Section 110(k) (Section 107(d)(3)(E)(ii) and (v))

    We have determined that Indiana has met all currently applicable SIP requirements for purposes of redesignation for the Muncie area under section 110 of the CAA (general SIP requirements). In addition, with the exception of the emissions inventory under section 172(c)(3), all applicable planning requirements of the Indiana SIP for purposes of redesignation have either been approved or have been suspended by either a clean data determination or determination of attainment. As discussed below, in this action, EPA is approving Indiana's 2013 emissions inventory as meeting the section 172(c)(3) comprehensive emissions inventory requirement. Thus, we are determining that the Indiana submittal meets all SIP requirements currently applicable for purposes of redesignation under part D of title I of the CAA, in accordance with sections 107(d)(3)(E)(ii) and 107(d)(3)(E)(v).

    In making these determinations, we have ascertained which SIP requirements are applicable for purposes of redesignation, and concluded that the Indiana SIP includes measures meeting those requirements and that they are fully approved under section 110(k) of the CAA.

    a. Indiana Has Met All Applicable Requirements for Purposes of Redesignation of the Muncie Area Under Section 110 and Part D of the CAA i. Section 110 General SIP Requirements

    Section 110(a) of title I of the CAA contains the general requirements for a SIP. Section 110(a)(2) provides that the implementation plan submitted by a state must have been adopted by the state after reasonable public notice and hearing, and, among other things, must include enforceable emission limitations and other control measures, means or techniques necessary to meet the requirements of the CAA; provide for establishment and operation of appropriate devices, methods, systems, and procedures necessary to monitor ambient air quality; provide for implementation of a source permit program to regulate the modification and construction of any stationary source within the areas covered by the plan; include provisions for the implementation of part C, Prevention of Significant Deterioration (PSD) and part D, New Source Review (NSR) permit programs; include criteria for stationary source emission control measures, monitoring, and reporting; include provisions for air quality modeling; and provide for public and local agency participation in planning and emission control rule development. Section 110(a)(2)(D) of the CAA requires that SIPs contain measures to prevent sources in a state from significantly contributing to air quality problems in another state.

    EPA interprets the “applicable” requirements for an area's redesignation to be those requirements linked with a particular area's nonattainment designation. Therefore, we believe that the section 110 elements described above that are not connected with nonattainment plan submissions and not linked with an area's attainment status, such as the “infrastructure SIP” elements of section 110(a)(2), are not applicable requirements for purposes of redesignation. A state remains subject to these requirements after an area is redesignated to attainment, and thus EPA does not interpret such requirements to be relevant applicable requirements to evaluate in a redesignation. For example, the requirement to submit state plans addressing interstate transport obligations under section 110(a)(2)(D)(i)(I) continue to apply to a state regardless of the designation of any one particular area in the state, and thus are not applicable requirements to be evaluated in the redesignation context.

    EPA has applied this interpretation consistently in many redesignations for decades. See e.g., 81 FR 44210 (July 7, 2016) (final redesignation for the Sullivan County, Tennessee area); 79 FR 43655 (July 28, 2014) (final redesignation for Bellefontaine, Ohio lead nonattainment area); 61 FR 53174-53176 (October 10, 1996) and 62 FR 24826 (May 7, 1997) (proposed and final redesignation for Reading, Pennsylvania ozone nonattainment area); 61 FR 20458 (May 7, 1996) (final redesignation for Cleveland-Akron-Lorain, Ohio ozone nonattainment area); and 60 FR 62748 (December 7, 1995) (final redesignation of Tampa, Florida ozone nonattainment area). See also 65 FR 37879, 37890 (June 19, 2000) (discussing this issue in final redesignation of Cincinnati, Ohio 1-hour ozone nonattainment area); 66 FR 50399 (October 19, 2001) (final redesignation of Pittsburgh, Pennsylvania 1-hour ozone nonattainment area).

    We have reviewed the Indiana SIP and determined that it meets the general SIP requirements under section 110 of the CAA to the extent they are applicable for purposes of redesignation. EPA has previously approved provisions of Indiana's SIP addressing section 110 requirements (including provisions addressing lead), at 40 CFR 52.770.

    On December 12, 2011, Indiana submitted a request for EPA to approve “infrastructure SIP” elements for the lead NAAQS required under CAA section 110(a)(2). EPA approved the Indiana lead infrastructure SIP on April 29, 2015 (80 FR 23713).

    ii. Part D Requirements

    EPA has determined that upon approval of the base year emissions inventory discussed in this rulemaking, the Indiana SIP will meet the requirements applicable for purposes of redesignation under part D of the CAA for the Muncie lead nonattainment area. Subpart 1 of part D sets forth the general nonattainment requirements applicable to all nonattainment areas.

    (1) Section 172 Requirements

    Section 172(c) sets out general nonattainment plan requirements. A thorough discussion of these requirements can be found in the General Preamble for Implementation of Title I (57 FR 13498, April 16, 1992) (“General Preamble”). EPA's longstanding interpretation of the nonattainment planning requirements of section 172 is that once an area is attaining the NAAQS, those requirements are not “applicable” for purposes of CAA section 107(d)(3)(E)(ii) and therefore need not be approved into the SIP before EPA can redesignate the area. In the General Preamble, EPA set forth its interpretation of applicable requirements for purposes of evaluating redesignation requests when an area is attaining a standard. See 57 FR at 13564. EPA noted that the requirements for reasonable further progress and other measures designed to provide for an area's attainment do not apply in evaluating redesignation requests because those nonattainment planning requirements “have no meaning” for an area that has already attained the standard. Id. This interpretation was also set forth in the Calcagni Memorandum.1

    1 September 4, 1992, Memorandum from John Calcagni, Director, Air Quality Management Division (EPA), entitled, “Procedures for Processing Requests to Redesignate Areas to Attainment.”

    EPA's understanding of section 172 also forms the basis of its Clean Data Policy. Under the Clean Data Policy, EPA promulgates a determination of attainment, published in the Federal Register and subject to notice-and-comment rulemaking, and this determination formally suspends a state's obligation to submit most of the attainment planning requirements that would otherwise apply, including an attainment demonstration and planning SIPs to provide for reasonable further progress (RFP), reasonably available control technology and reasonably available control measures (RACT-RACM), and contingency measures. The Clean Data Policy has been codified in regulations regarding the implementation of the ozone and fine particulate matter NAAQS. See e.g., 70 FR 71612 (November 29, 2005) and 72 FR 20586 (April 25, 2007). The Clean Data Policy has also been specifically applied in a number of lead nonattainment areas where EPA has determined that the area is attaining the lead NAAQS. See, e.g., 79 FR 46212 (August 7, 2014) (proposed determination of attainment of Lyons, Pennsylvania lead nonattainment area); 80 FR 51127 (determination of attainment of Eagan, Minnesota lead nonattainment area). EPA's long-standing interpretation regarding the applicability of section 172(c)'s attainment planning requirements for an area that is attaining a NAAQS applies in this redesignation of the Muncie lead nonattainment area as well. Because we are determining that the Muncie area has reached attainment, Indiana will not need to address these additional measures to provide for attainment, and section 172(c)(1) requirements are no longer considered to be applicable as long as the area continues to attain the standard until redesignation. (40 CFR 51.918). Therefore, Indiana has met its requirements under CAA section 172(c)(1) and section 107(d)(3)(E)(v).

    As noted above, additional section 172(c) attainment planning requirements are not applicable for purposes of evaluating the state's redesignation request. The reasonable further progress (RFP) requirement under section 172(c)(2), which is defined as progress that must be made toward attainment, the requirement to submit section 172(c)(9) contingency measures, which are measures to be taken if the area fails to make reasonable further progress to attainment, and section 172(c)(6)'s requirement that the SIP contain control measures necessary to provide for attainment of the standard, are not applicable requirements that Indiana must meet here because the Muncie area has monitored attainment of the 2008 lead NAAQS.

    Section 172(c)(3) requires submission and approval of a comprehensive, accurate and current inventory of actual emissions. Indiana submitted a 2013 base year emissions inventory along with their redesignation request on April 14, 2016, and requested that the 2013 inventory be used as the most accurate and current inventory. As discussed below in section III(C), EPA is approving the 2013 attainment year inventory as meeting the section 172(c)(3) emissions inventory requirement for the Muncie area.

    Section 172(c)(4) requires the identification and quantification of allowable emissions for major new and modified stationary sources in an area, and section 172(c)(5) requires source permits for the construction and operation of new and modified major stationary sources anywhere in the nonattainment area. EPA approved Indiana's current NSR program on October 7, 1994 (59 FR 51114). In addition, the state's maintenance plan does not rely on nonattainment NSR, therefore having a fully approved NSR program is not an applicable requirement, but that, nonetheless, we have approved the state's program.1

    1 A detailed rationale for this view is described in a memorandum from Mary Nichols, Assistant Administrator for Air and Radiation, dated October 14, 1994, entitled, “Part D New Source Review Requirements for Areas Requesting Redesignation to Attainment.”

    Section 172(c)(7) requires the SIP to meet the applicable provisions of section 110(a)(2). As noted above, we find that the Indiana SIP meets the section 110(a)(2) applicable requirements for purposes of redesignation.

    (2) Section 176 Conformity Requirements

    Section 176(c) of the CAA requires states to establish criteria and procedures to ensure that Federally-supported or funded activities, including highway and transit projects, conform to the air quality planning goals in the applicable SIPs. The requirement to determine conformity applies to transportation plans, programs and projects developed, funded or approved under title 23 of the U.S. Code and the Federal Transit Act (transportation conformity) as well as to all other Federally-supported or funded projects (general conformity). In light of the elimination of lead additives in gasoline, transportation conformity does not apply to the lead NAAQS. See 73 FR 66964, 67043 n.120. EPA approved Indiana's general conformity SIP on January 14, 1998 (63 FR 2146).

    b. Indiana Has a Fully Approved Applicable SIP Under Section 110(k) of the CAA

    Upon final approval of Indiana's comprehensive 2013 emissions inventories for the Muncie lead area, EPA will have fully approved the Indiana SIP for the Muncie area under section 110(k) of the CAA for all requirements applicable for purposes of redesignation, in accordance with section 107(d)(3)(E)(ii). EPA may rely on prior SIP approvals in approving a redesignation request. See Calcagni Memorandum at (3); Southwestern Pennsylvania Growth Alliance v. Browner, 144 F.3d 984, 989-990 (6th Cir. 1998); Wall v. EPA, 265 F.3d 426 (6th Cir. 2001). EPA also relies on measures approved in conjunction with a redesignation action. See, e.g., 68 FR 25413 (May 12, 2003) (approving I/M program for St. Louis) and 68 FR 25426 (May 12, 2003) (approving redesignation relying in part on I/M program approval). As discussed in the prior section, Indiana has adopted and submitted, and EPA has fully approved, a number of required SIP provisions addressing the 2008 lead standards. As part of its redesignation request and maintenance plan submittal, Indiana submitted a demonstration to EPA that the Muncie nonattainment area has attained the 2008 lead NAAQS. Pursuant to 40 CFR 51.1004(c), EPA's determination that the area has attained the 2008 lead standards will suspend the requirement to submit certain planning SIPs related to attainment, including attainment demonstration requirements, the RACT-RACM requirement of section 172(c)(1) of the CAA, the RFP and attainment demonstration requirements of sections 172(c)(2) and (6) and 182(b)(1) of the CAA, and the requirement for contingency measures of section 172(c)(9) of the CAA. As noted above, the area has continued to attain the standard. Of the CAA requirements applicable to this redesignation request, only the emissions inventory requirement of section 172(c)(3) remains.

    In today's action, EPA is approving Indiana's 2013 emissions inventories for the Muncie area as meeting the requirement of section 172(c)(3) of the CAA. No Muncie area SIP provisions are currently disapproved, conditionally approved, or partially approved. Therefore, the Administrator has fully approved the applicable requirements for the Muncie area under section 110(k) in accordance with section 107(d)(3)(E)(ii).

    3. The Improvement in Air Quality Is Due to Permanent and Enforceable Reductions in Emissions Resulting From Implementation of the SIPs and Applicable Federal Air Pollution Control Regulations and Other Permanent and Enforceable Reductions (Section 107(d)(3)(E)(iii))

    EPA believes that Indiana has demonstrated that the observed air quality improvement in the Muncie area is due to permanent and enforceable reductions in emissions. The only stationary source of lead in the Muncie area is the Exide Technologies facility. According to Indiana this source complies with EPA's January 5, 2012 National Emissions Standards for Hazardous Air Pollutants (NESHAP) for secondary lead smelting at 40 CFR part 63, subpart X. According to Indiana, Exide Technologies complied with this NESHAP through the installation of control technologies and adoption of recordkeeping and reporting requirements that are also located in Title 326, Articles 15 and 20 of the Indiana Administrative Code (80 FR 42393).

    (B) Indiana Has a Fully Approved Maintenance Plan Pursuant to Section 175A of the CAA (Section 107(d)(3)(E)(iv))

    In conjunction with Indiana's request to redesignate the Muncie nonattainment area to attainment status, Indiana has submitted a SIP revision to provide for maintenance of the 2008 lead NAAQS in the area through 2030.

    1. What is required in a maintenance plan?

    Section 175A of the CAA sets forth the required elements of a maintenance plan for areas seeking redesignation from nonattainment to attainment. Under section 175A, the plan must demonstrate continued attainment of the applicable NAAQS for at least 10 years after EPA approves a redesignation to attainment. Eight years after redesignation, the state must submit a revised maintenance plan which demonstrates that attainment will continue to be maintained for 10 years following the initial ten-year maintenance period. To address the possibility of future NAAQS violations, the maintenance plan must contain contingency measures with a schedule for implementation as EPA deems necessary to assure prompt correction of any future lead violations.

    The September 4, 1992, Calcagni memorandum provides additional guidance on the content of a maintenance plan. The memorandum states that a maintenance plan should address the following items: The attainment emissions inventory, a maintenance demonstration showing maintenance for the 10 years of the maintenance period, a commitment to maintain the existing monitoring network, factors and procedures to be used for verification of continued attainment of the NAAQS, and a contingency plan to prevent or correct future violations of the NAAQS.

    Section 175A of the CAA requires a state seeking redesignation to attainment to submit a SIP revision to provide for the maintenance of the NAAQS in the area “for at least 10 years after the redesignation.” EPA has interpreted this as a showing of maintenance “for a period of 10 years following redesignation.” Calcagni memorandum at 9. Where the emissions inventory method of showing maintenance is used, its purpose is to show that emissions during the maintenance period will not increase over the attainment year inventory. Calcagni memorandum at 9-10.

    As discussed in detail in the section below, the state's maintenance plan submission expressly documents that the area's emissions inventories will remain below the attainment year inventories through 2030, more than 10 years after redesignation.

    2. Attainment Inventory

    Indiana developed an emissions inventory for lead for 2013, one of the years in the period during which the Muncie area monitored attainment of the 2008 lead standard. The attainment level of emissions is summarized in Table 2 below along with future maintenance projections.

    3. Demonstration of Maintenance

    Along with the redesignation request, Indiana submitted a revision to its lead SIP to include a maintenance plan for the Muncie area, as required by section 175A of the CAA. Indiana's plan demonstrates maintenance of the 2008 lead standard through 2030 by showing that current and future emissions of lead in the area remain at or below attainment year emission levels. Section 175A requires a state seeking redesignation to attainment to submit a SIP revision to provide for the maintenance of the NAAQS in the area “for at least 10 years after the redesignation.” EPA has interpreted this as a showing of maintenance “for a period of 10 years following redesignation.” Calcagni memorandum at 9. Where the emissions inventory method of showing maintenance is used, its purpose is to show that emissions during the maintenance period will not increase over the attainment year inventory. Calcagni memorandum at 9-10.

    Indiana's plan demonstrates maintenance of the 2008 lead NAAQS through 2030 by showing that current and future emissions of lead for the area will not cause an exceedance of the standard. For the baseline and attainment year inventories, Indiana used Exide Technologies' actual emissions instead of allowable emissions under Indiana Administrative Code. As shown in Table 2, Indiana's submittal indicates that the 2010 and 2013 inventories are based on actual emissions from the Exide Technologies facility (which were 0.82 tons per year (tpy) in 2010 and 0.63 tpy in 2013), and not the allowable emissions set forth in Exide Technologies' operating permit (which were 3.48 tpy in 2010 and 1.73 tpy in 2013). Indiana submitted computer-modeled data indicating that the 2030 maintenance inventory, which is based on the facility's allowable emissions with controls implemented to meet the NESHAP for secondary lead smelting, will ensure that the Muncie area continues to maintain the standard through 2030. To meet the NESHAP for secondary lead smelters, Exide Technologies facility's main building serves as a total enclosure that maintains negative air pressure at all times and is vented to control devices designed to capture lead particulate emissions. This ensures fugitive dust generated inside the facility is not released outside the enclosure and into the ambient air. Since these controls have been installed at the facility, the monitored design value concentrations at the site have been and should remain below the 2008 lead NAAQS. Indiana expects that these permanent and enforceable controls installed at Exide Technologies will ensure that there will be no exceedances of the lead NAAQS in the future. With no other significant sources of lead, the Muncie area is predicted to stay below the standard.

    Table 2—Comparison of 2010, 2013, and 2030 Lead Totals (tpy) for the Muncie Area * 2010
  • (Baseline)
  • 2013
  • (Attainment)
  • 2030
  • (Maintenance)
  • 0.82 0.63 1.73 * 2010 Baseline and 2013 attainment inventories reflect actual lead emissions in the Muncie area, while the 2030 maintenance inventory reflects modeled allowable emissions in Exide Technologies' operating permit.
    4. Monitoring Network

    Indiana's maintenance plan includes a commitment to continue to operate its EPA-approved monitoring network, as necessary to demonstrate ongoing compliance with the NAAQS. Indiana currently operates one lead monitor in the Muncie, Indiana area.

    5. Verification of Continued Attainment

    Indiana remains obligated to continue to quality-assure monitoring data and enter all data into the Air Quality System (AQS) in accordance with Federal guidelines. Indiana will use these data, supplemented with additional information as necessary, to assure that the area continues to attain the standard. Indiana will also continue to develop and submit periodic emission inventories as required by the Federal Consolidated Emissions Reporting Rule (67 FR 39602, June 10, 2002) to track future levels of emissions. Both of these actions will help to verify continued attainment in accordance with 40 CFR part 58.

    6. Contingency Plan

    The contingency plan provisions are designed to promptly correct or prevent a violation of the NAAQS that might occur after redesignation of an area to attainment. Section 175A of the CAA requires that a maintenance plan include such contingency measures as EPA deems necessary to assure that the state will promptly correct a violation of the NAAQS that occurs after redesignation. The maintenance plan should identify the contingency measures to be adopted, a schedule and procedure for adoption and implementation of the contingency measures, and a time limit for action by the state. The state should also identify specific indicators to be used to determine when the contingency measures need to be adopted and implemented. The maintenance plan must include a requirement that the state will implement all pollution control measures that were contained in the SIP before redesignation of the area to attainment. See section 175A(d) of the CAA.

    Indiana's contingency plan defines a warning level and action level response. The warning level response will trigger when a lead monitor three-month rolling average exceeds 0.143 μg/m3 in the maintenance area. If a warning level response is triggered, Indiana will conduct a study to determine whether the lead values indicate a trend toward exceeding the standard and what control measure would be necessary to reverse the trend within twelve months of the conclusion of the calendar year. The action level response will be prompted by the determination of the warning level study that a reverse of the trend is needed, or by the three-month rolling average exceeding 0.15 μg/m3. The action level response will require Indiana to work with the culpable entity to evaluate and implement the needed control measures to bring the area into attainment within 18 months of the conclusion of the calendar year that triggered the response.

    Currently, no new sources of lead are projected for the Muncie area, so all control measures would be determined after an analysis of the situation but could include further controls on fugitive lead emissions, reduction of operating hours, or improved housekeeping and maintenance. Indiana commits to continue implementing SIP requirements upon and after redesignation.

    EPA believes that Indiana's contingency measures, as well as the commitment to continue implementing any SIP requirements, satisfy the pertinent requirements of section 175A(d).

    As required by section 175A(b) of the CAA, Indiana commits to submit to the EPA an updated lead maintenance plan eight years after redesignation of the Muncie area to cover an additional 10-year period beyond the initial 10-year maintenance period.

    For all of the reasons set forth above, EPA is approving Indiana's 2008 lead maintenance plan for the Muncie area as meeting the requirements of CAA section 175A.

    (C) Comprehensive Emissions Inventory

    As discussed above, section 172(c)(3) of the CAA requires areas to submit a comprehensive emissions inventory including all lead sources in the nonattainment area. In its April 14, 2016 submittal, Indiana submitted comprehensive emissions inventories for its 2010 base year, 2013 attainment year, and 2030 maintenance year.

    EPA believes that the 2010, 2013, and 2030 emissions inventories are complete and accurate, and meet the requirement of CAA section 172(c)(3). The inventories are shown in Table 3.

    Table 3—2010, 2013, and 2030 Lead Totals (tpy) for the Muncie Area * 2010
  • (Baseline)
  • 2013
  • (Attainment)
  • 2030
  • (Maintenance)
  • 0.82 0.63 1.73 * 2010 Baseline and 2013 attainment inventories reflect actual lead emissions in the Muncie area, while the 2030 maintenance inventory reflects modeled allowable emissions in Exide Technologies' operating permit.
    V. What action is EPA taking?

    EPA is taking several actions related to the redesignation of the Muncie area to attainment for the 2008 lead NAAQS. First, EPA is finding that Indiana meets the requirements for redesignation under section 107(d)(3)(E) of the CAA for the Muncie area to attainment of the 2008 lead NAAQS. EPA is thus approving Indiana's request to change the designation of the Muncie area from nonattainment to attainment for the 2008 lead NAAQS.

    In addition, EPA is approving Indiana's lead maintenance plan for the Muncie area as a revision to the Indiana SIP. Finally, EPA is approving the 2013 lead attainment year emission inventory which satisfies the requirement in section 172(c)(3) for a current, accurate and comprehensive emission inventory.

    We are publishing these actions without prior proposal because we view this as a noncontroversial amendment and anticipate no adverse comments. However, in the proposed rules section of this Federal Register publication, we are publishing a separate document that will serve as the proposal to approve the state plan if relevant adverse written comments are filed. This rule will be effective July 31, 2017 without further notice unless we receive relevant adverse written comments by June 29, 2017. If we receive such comments, we will withdraw this action before the effective date by publishing a subsequent document that will withdraw the final action. All public comments received will then be addressed in a subsequent final rule based on the proposed action. EPA will not institute a second comment period. Any parties interested in commenting on this action should do so at this time. Please note that if EPA receives adverse comment on an amendment, paragraph, or section of this rule and if that provision may be severed from the remainder of the rule, EPA may adopt as final those provisions of the rule that are not the subject of an adverse comment. If we do not receive any comments, this action will be effective July 31, 2017.

    VI. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by July 31, 2017. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the proposed rules section of today's Federal Register, rather than file an immediate petition for judicial review of this direct final rule, so that EPA can withdraw this direct final rule and address the comment in the proposed rulemaking. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

    List of Subjects 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Lead, Reporting and recordkeeping requirements.

    40 CFR Part 81

    Environmental protection, Air pollution control, National parks, Wilderness areas.

    Dated: May 4, 2017. Robert A. Kaplan, Acting Regional Administrator, Region 5.

    40 CFR parts 52 and 81 are amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    2. In § 52.770 the table in paragraph (e) is amended by adding new entries in alphabetical order for “Muncie 2008 lead emissions inventory” and “Muncie 2008 lead maintenance plan” to read as follows:
    § 52.770 Identification of plan.

    (e) * * *

    EPA-Approved Indiana Nonregulatory and Quasi-Regulatory Provisions Title Indiana date EPA approval Explanation *         *         *         *         *         *         * Muncie 2008 lead emissions inventory 4/14/2016 5/30/2017 [insert Federal Register citation] Muncie 2008 lead maintenance plan 4/14/2016 5/30/2017 [insert Federal Register citation] *         *         *         *         *         *         *
    3. Section 52.797 is amended by adding paragraphs (f) and (g) to read as follows:
    § 52.797 Control strategy: Lead.

    (f) Approval—Indiana's 2008 lead emissions inventory for the Muncie area, as submitted on April 14, 2016, satisfying the emission inventory requirements of section 172(c)(3) of the Clean Air Act for the Muncie area.

    (g) Approval—The 2008 lead maintenance plan for the Muncie, Indiana nonattainment area has been approved as submitted on April 14, 2016.

    PART 81—DESIGNATION OF AREAS FOR AIR QUALITY PLANNING PURPOSES 4. The authority citation for part 81 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    5. Section 81.315 is amended by revising the entry for Muncie, IN in the table entitled “Indiana—2008 Lead NAAQS” to read as follows:
    § 81.315 Indiana. Indiana—2008 Lead NAAQS Designated area Designation for the 2008 NAAQS a Date 1 Type Muncie, IN Delaware County (part) 5/30/2017 Attainment. A portion of the City of Muncie, Indiana bounded to the North by West 26th Street/Hines Road, to the east by Cowan Road, to the south by West Fuson Road, and to the west by a line running south from the eastern edge of Victory Temple's driveway to South Hoyt Avenue and then along South Hoyt Avenue. *         *         *         *         *         *         * a Includes Indian Country located in each county or area, except as otherwise specified. 1 December 31, 2011 unless otherwise noted.
    [FR Doc. 2017-10906 Filed 5-26-17; 8:45 am] BILLING CODE 6560-50-P
    FEDERAL COMMUNICATIONS COMMISSION 47 CFR Part 1 [MD Docket No. 17-123; FCC 17-53] Procedures for Paper Filings and Collecting Application and Regulatory Fees AGENCY:

    Federal Communications Commission.

    ACTION:

    Final rule.

    SUMMARY:

    In this document, the Commission commences the process of migrating away from using P.O. Boxes (“Lockboxes”) to collect application and regulatory fees, as well as paper filings. As the Commission gravitates toward an all-electronic payment and filing system, the P.O. Boxes once established to collect filings and fees via check or money order will be gradually closed, and the Commission's rules changed accordingly. In this, the first step of this process, the Commission amends its rules to close P.O. Box 979092, used to collect petitions filed under of the Communications Assistance for Law Enforcement Act (CALEA), as well as associated fee payments. Permittees wishing to file future petitions will need to do so electronically through the Commission's electronic filing system and pay the pertinent fees through the Fee Filer Online System, or through another electronic payment mechanism designated by the Commission.

    DATES:

    Effective June 29, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Warren Firschein, Office of Managing Director at (202) 418-0844.

    SUPPLEMENTARY INFORMATION:

    1. In this Order, we reduce Commission expenditures and modernize our procedures by amending section 1.1109 1 of our rules, which sets forth the application fee for petitions filed with the Federal Communications Commission (Commission) under section 109(b) of the Communications Assistance for Law Enforcement Act (CALEA).2

    1 47 CFR 1.1109.

    2 47 U.S.C. 1008(b).

    2. Enacted in 1994, CALEA was designed to respond to advances in technology and eliminate obstacles faced by law enforcement personnel in conducting electronic surveillance.3 CALEA imposed certain technical requirements on telecommunications carriers and provided carriers with certain rights to petition the Commission for relief from these requirements.4 CALEA also amended the Commission's fee schedule under section 8 of the Communications Act 5 to require payment of an application fee for one type of CALEA filing—petitions filed under section 109(b) of CALEA.6 Such section 109(b) petitions allowed telecommunications carriers to petition the Commission for an order declaring the petitioning carrier's obligation to comply with CALEA's section 103 capability requirements “not reasonably achievable.” 7 The section 109(b) fee requirement was codified in section 1.1109 of the Commission's rules 8 providing for payment of the fee to P.O. Box 979092 at U.S. Bank in St. Louis, Missouri.9 The only current use of section 1.1109 and P.O. Box 979092 is to collect fees for section 109(b) petitions. The FCC has not received a section 109(b) petition since 2002.

    3See generally Communications Assistance for Law Enforcement Act, Second Report and Order, 15 FCC Rcd 7105 (1999).

    4Id. at 7121-33, paras. 30-46; see also Communications Assistance for Law Enforcement Act and Broadband Access and Services, ET Docket No. 04-295, Second Report and Order and Memorandum Opinion and Order, 21 FCC Rcd 5360 (2006).

    5 47 U.S.C. 158.

    6 Communications Assistance for Law Enforcement Act, Public Law 103-414, 302, 108 Stat. 4279, 4294 (1994). Section 302 of CALEA provided for modification of the Commission's schedule of application fees. In 1994, when CALEA was enacted, that fee was established at $5,000, which was subsequently adjusted for inflation.

    7 47 U.S.C. 1008(b)(1).

    8 47 CFR 1.1109.

    9Id.

    3. The Commission has started to migrate away from using P.O. Boxes 10 and toward using an all-electronic payment system for all application and regulatory fees.11 This change is based on U.S. Treasury guidance and is being implemented to the extent practicable and otherwise permitted by law.12 Utilizing an all-electronic payment system will increase the agency's financial efficiency by reducing expenditures, including the annual fee for utilizing the bank's services as well as the cost to manually process each transaction, and will have no measurable impact on telecommunications carriers.

    10 The FCC collects fees using a series of P.O. Boxes located at U.S. Bank in St. Louis, Missouri. 47 CFR 1.1101-1.1109 (setting forth the fee schedule for each type of application remittable to the Commission along with the correct lockbox).

    11 In 2015, the Commission revised its payment rules to encourage electronic payment of application fees and require electronic payment of regulatory fees. 47 CFR 1.1112 (application fees) and 1.1158 (regulatory fees). These rules became effective November 30, 2015. 80 FR 66816 (Oct. 30, 2015).

    12 Treasury Financial Manual, Bulletin Number 2014-08, “Agency No-Cash or No-Check Policies,” released on August 5, 2014 (Explaining the circumstances under which agencies may decide not to accept payments made in cash or by check and also noting that the U.S. Treasury's move to an all-electronic Treasury as well as the purposes of Federal cash-management statutes.) Available at https://tfm.fiscal.treasury.gov/v1/bull/14-08.pdf (last visited March 10, 2017); see also https://obamawhitehouse.archives.gov/the-press-office/2011/06/13/executive-order-13576-delivering-efficient-effective-and-accountable-gov.

    4. As part of this effort, we are closing P.O. Box 979092. With this Order, we amend our rules to reflect this change as indicated in the Final Rules section of this Order. Future payments for any section 109(b) petition filed with the Commission will be made in accordance with the procedures set forth on the Commission's Web site, https://www.fcc.gov/licensing-databases/fees. For now, such payments will be made through the Fee Filer Online System, accessible at https://www.fcc.gov/licensing-databases/fees/fee-filer, but as we assess and implement U.S. Treasury guidance on an all-electronic payment system, we may transition to other secure payment systems with appropriate public notice and guidance. We make this change without notice and comment because it is a rule of agency organization, procedure, or practice exempt from the general notice-and-comment requirements of the Administrative Procedure Act.13 To file section 109(b) petitions electronically, parties should utilize the Commission's ECFS filing system, which can be found at http://apps.fcc.gov/ecfs/upload/display. Petitions filed in hard copy format should be submitted according to the procedures set forth on the Web page of the FCC's Office of the Secretary, https://www.fcc.gov/secretary.

    13 5 U.S.C. 553(b)(A).

    5. This document does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

    6. Accordingly, it is ordered, that pursuant to sections 4(i), 4(j), 201(b), and 229(a) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 201(b), 229(a), 47 CFR part 1 is amended as set forth below.

    7. It is further ordered, that the Commission shall send a copy of this Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

    Federal Communications Commission. Marlene H. Dortch, Secretary. Final Rules

    For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 1 as follows:

    PART 1—PRACTICE AND PROCEDURE 1. The authority citation for part 1 is revised to read as follows: Authority:

    47 U.S.C. 151, 154(i), 154(j), 155, 157, 160, 201, 225, 227, 303, 309, 332, 1403, 1404, 1451, 1452, and 1455.

    2. Revise § 1.1109 to read as follows:
    § 1.1109 Schedule of charges for applications and other filings for the Homeland services.

    Remit filings and/or payment for these services electronically using the Commission's electronic filing and payment system, in accordance with the procedures set forth on the Commission's Web site, https://www.fcc.gov/licensing-databases/fees.

    Service FCC Form No. Fee
  • amount
  • Payment
  • type code
  • 1. Communication Assistance for Law Enforcement (CALEA) Petitions Correspondence & 159 $6,695.00 CLEA
    [FR Doc. 2017-11034 Filed 5-26-17; 8:45 am] BILLING CODE 6712-01-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 259 [Docket No. 080410551-7410-02] RIN 0648-AW57 Capital Construction Fund; Fishing Vessel Capital Construction Fund Procedures AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Final rule.

    SUMMARY:

    NMFS hereby amends the Capital Construction Fund (CCF) regulations to eliminate provisions that no longer meet the needs of CCF participants, and to simplify and clarify the regulations to better implement the purposes of the underlying statute. These amendments eliminate the minimum cost for reconstruction projects, requirements for minimum annual deposits and the requirement that any vessel acquired with CCF funds must be reconstructed, regardless of vessel condition. The new regulations also prohibit withdrawals of funds under the CCF program (program) for projects that increase harvesting capacity, unless the project is subject to a limited access system in which the fisheries management authority establishes harvesting limits.

    DATES:

    Effective June 29, 2017.

    ADDRESSES:

    Copies of the Environmental Assessment/Regulatory Impact Review/Final Regulatory Flexibility Analysis (EA/RIR/FRFA) prepared for this action may be obtained from Paul Marx, Chief, Financial Services Division, NMFS, Attn: Capital Construction Fund Rulemaking, 1315 East-West Highway, Silver Spring, MD 20910 or by calling Richard VanGorder (see FOR FURTHER INFORMATION CONTACT) or on the Capital Construction Fund Web site at http://www.nmfs.noaa.gov/mb/financial_services/ccf.htm.

    Send comments regarding the burden-hour estimates or other aspects of the collection-of-information requirements contained in this final rule to Richard VanGorder at the address specified above and also to the Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), Washington, DC 20503 (Attention: NOAA Desk Officer) or email to [email protected], or fax to (202) 395-7825.

    FOR FURTHER INFORMATION CONTACT:

    Richard VanGorder at 301-427-8784 or via email at [email protected].

    SUPPLEMENTARY INFORMATION: Background

    This final rule revises and replaces the CCF regulations found at 50 CFR part 259.

    The program was established by the Merchant Marine Act of 1936 (MMA), ch. 858, title VI, sec. 607(a), 49 Stat. 2005 (1936) (current version at 46 U.S.C. 53503 (2007) and is administered pursuant to 50 CFR part 259.

    The purpose of the program is to assist owners and operators of United States flagged vessels in accumulating the large amount of capital necessary for the modernization of the U.S. merchant marine fleet. The extensive vessel reconstruction requirements in the current regulations no longer make sense given the improved status of the merchant marine fleet.

    The program encourages construction, reconstruction, or acquisition of vessels through deferment of Federal income taxes. Owners and operators of vessels deposit income from fishing into CCF accounts prior to paying income taxes. All deferred taxes are eventually recovered upon the sale of the vessel because the cost basis of the vessel is reduced by the dollar amount of CCF funds used for its purchase or improvements.

    To participate in the program, a vessel owner submits an application to the Financial Services Division of the National Marine Fisheries Service in advance of the relevant Federal tax filing due date. The application identifies the income earning vessel(s), the type of project(s) anticipated, and the financial institution that will hold the CCF deposits. Once the Secretary of Commerce deems an application compliant with the CCF statute and regulations, a CCF Agreement is executed between the United States and the vessel owner or operator.

    Currently, there are 1,394 CCF Agreements with a total of approximately $270M on deposit. Many of these CCF Agreements were established years ago and identify scheduled projects that are no longer viable. Consequently, CCF participants are faced with either having funds languish on deposit for nonviable scheduled projects or making a non-qualified withdrawal of funds and paying deferred taxes at the highest marginal rate.

    The authority to make regulatory changes to the program is granted under 46 U.S.C. 53502(a), which permits the Secretary of Commerce to prescribe regulations (except for the determination of tax liability) to carry out the program. The program regulations were last amended in 1997 to permit reconstruction projects for safety improvements.

    The changes to the CCF regulations are intended to ease the current restrictions on the allowable uses of CCF funds while remaining consistent with current agency priorities of maintaining sustainable fisheries. For example, currently, reconstruction is required when using CCF funds to acquire a used vessel. Reconstruction is mandated regardless of the condition of the vessel. Consequently, the CCF participant must often invest money in unnecessary capital improvements. If this requirement is eliminated and the definition of a “qualified reconstruction” is changed, a large portion of the funds that are currently on deposit could be used for projects that are actually needed, rather than required by now-outdated regulations. Additionally, these changes would allow the Government to recapture deferred taxes.

    Summary of Comments and Reponses

    The proposed rule (79 FR 57496, September 25, 2014) solicited public comments through November 10, 2014. During the comment period, NMFS received comments from eight individuals and twenty-six entities. The twenty-six entities include companies that currently participate in the CCF program, CCF representatives, trade associations and environmental groups. Most individuals and entities made multiple comments in one document. Comments were generally in favor of the changes made in the proposed rule but many expressed concerns over certain provisions. The specific comments and our responses are as follows.

    Comment 1: Four individuals and twenty-four entities are opposed to adding harvesting capacity restrictions to acquisition, construction and reconstruction projects.

    Response: NMFS agrees that a purpose of the rule is to prohibit any project activity from increasing harvesting in a fishery, as opposed to affecting harvesting capacity Therefore, the language is modified to prohibit CCF funds from being used for vessel acquisition, construction, or reconstruction that increases harvesting capacity other than in a limited access system in which the fisheries management authority establishes harvesting limits. In a limited access system in which the fisheries management authority establishes harvesting limits, increased capacity will not lead to increased harvesting above the limit set at the fishery level.

    Comment 2: One entity believes that the proposed harvesting capacity restrictions are not restrictive enough.

    Response: As indicated in the response to Comment 1, NMFS believes that prohibiting CCF funds from being used in a manner that increases harvesting capacity is only necessary for fisheries where there is not an established limited access system under a management system which provides adequate safeguards to ensure the goal of maintaining sustainable fisheries is met.

    Comment 3: Five individuals and nineteen entities are opposed to reducing the timeframe to complete construction and reconstruction from eighteen months to twelve months. In addition, one individual and four entities proposed increasing the allowable timeframe up to thirty six months.

    Response: NMFS agrees that reducing the allowable timeframe to complete construction and reconstruction projects may cause an unintended burden on CCF program users. NMFS realizes that building new, safer and more fuel efficient vessels may take more than the proposed twelve month period. Thus, the final rule maintains the current eighteen month timeframe in accordance with existing regulations. NMFS believes that the majority of CCF projects will be completed in eighteen months. NMFS has the authority to grant extensions for projects which may require more time to complete.

    Comment 4: One individual and six entities stated that the definition of an eligible and qualified vessel includes only vessels fewer than five net tons and excludes Coast Guard documented vessels.

    Response: In response to public comments, NMFS has revised the rule to include vessels which are five net tons or greater and Coast Guard documented vessels as eligible and qualified. NMFS agrees that the exclusion of these vessels was unintended and erroneous.

    Comment 5: Eight entities stated that the proposed changes were contrary to the original statutory intent of the CCF program to modernize the US fishing fleet and support domestic shipyards.

    Response: The original statutory intent for the CCF program was to assist owners and operators of United States flagged vessels in accumulating the large amount of capital necessary for the modernization of the U.S. merchant marine fleet. The extensive vessel reconstruction requirements in the current regulations no longer make sense given the improved status of the merchant marine fleet. The changes made in this final rule eliminate provisions that no longer meet the needs of CCF participants and simplify the regulations to better implement the purposes of the underlying statute. These amendments eliminate the minimum cost for reconstruction projects, requirements for minimum annual deposits and the requirement that any vessel acquired with CCF funds must be reconstructed, regardless of vessel condition. NMFS feels that this final rule is consistent with the original purpose and intent of the statute.

    Comment 6: Two individuals and seven entities opined that the stated rationale for the proposed changes were not justified and that the proposed changes impose unnecessary restrictions and less flexibility.

    Response: NMFS disagrees and maintains that certain provisions of the current regulations no longer make sense given the status of the merchant marine fleet. These changes impose no additional burdens on program users. The changes reduce the burdens imposed by simplifying the regulations to eliminate the minimum cost for reconstruction projects, requirements for minimum annual deposits and the requirement that any vessel acquired with CCF funds must be reconstructed, regardless of vessel condition. These changes should bring the program into greater alignment with the current needs of program users and retain flexibility when undertaking CCF projects.

    Comment 7: One individual and one entity stated that the elimination of the minimum deposit requirement will interfere with the goals of the CCF program and may result in termination of CCF agreements.

    Response: The intent of the changes is to prevent forcing participants to deposit funds that are not necessary to complete qualified projects. These changes are consistent with the goals of the CCF program to set aside funds for specific projects to be completed in a timely manner. CCF Agreements will only be terminated if they are deemed inactive. While CCF Agreements may be terminated for inactivity, participants may apply again in the future for a new Agreement if desired.

    Comment 8: One individual has requested that NMFS keep small businesses in mind when constructing the final regulations.

    Response: The final rule has been constructed with the intent to eliminate provisions that no longer meet the needs of CCF participants, and to simplify and clarify the regulations to better implement the purposes of the underlying statute. These changes are intended to benefit all CCF program users including small businesses.

    Comment 9: Two individuals and eight entities stated that harvesting capacity is not defined in the proposed rule.

    Response: NMFS agrees that harvesting capacity is not specifically defined. However, Agreements involving projects that occur within a limited access system in which fisheries management authority establishes harvesting limits will not be affected by any limitations on harvesting capacity.

    Comment 10: One individual stated that the CCF program should be shut down.

    Response: The individual did not provide reasoning as to why the program should be eliminated. Congress has identified a need to modernize and expand the US fishing industry. The CCF program is designed to meet this need.

    Comment 11: One entity requested that former 50 CFR 259.36(c)(3), which was removed in the proposed rule, be added back to the final rule.

    Response: Former 50 CFR 259.36(c)(3) allowed for non-cash deposits or investments as approved depositories. The commenter stated that he had used this provision in the former regulation to include installment sales contracts as CCF assets when the required cash deposit from a vessel sale was not available in the year of sale. NMFS believes that this commenter's use of this provision is erroneous. 46 U.S.C. 53506 specifies that “Amounts in a capital construction fund shall be kept in the depository specified in the agreement and shall be subject to trustee and other fiduciary requirements prescribed by the Secretary. Except as provided in subsection (b) [stock investments], amounts in the fund may be invested only in interest-bearing securities approved by the Secretary.” An installment sales contract does not meet the definition of an allowable CCF investment as specified in the statute.

    Comment 12: One entity stated that the operation of charter vessels that allow customers to harvest fish for their own use does not appear to meet the proposed definition for a commercial fishing vessel and, therefore, would make them ineligible for CCF participation.

    Response: NMFS has revised the definitions for eligible and qualified vessels to specifically allow for charter vessels.

    Comment 13: One entity stated that the termination of inactive and zero balance accounts under 50 CFR 259.6 is contrary to Internal Revenue Code (IRC) section 7518(g)(5). The assertion was that such termination was contrary to this section because it provides that funds are only treated as non-qualified if they have been on deposit for more than twenty five years.

    Response: The commenter is confusing two separate authorities that govern the CCF program relating to time constraints. The IRC section 7518(g)(5) allows for the Secretary to treat funds that have been on deposit for more than twenty five years as non-qualified in years twenty six through thirty at specified percentages and taxed accordingly. Section 259.6 of this final rule separately allows for the Secretary to terminate CCF Agreements that have not undertaken a qualified project in the last ten years. The purpose of this section is to terminate inactive accounts. These two sections are not related and, therefore, do not contradict each other.

    Comment 14: One entity stated that the ten year period to complete a project should commence as of the last amendment date and not the start date of the Agreement.

    Response: NMFS disagrees that the ten year period to begin a project should start as of the last amendment date. The requirement to do at least one project every ten years existed in the prior CCF regulation. The final rule does not change this requirement. The CCF program was created to modernize the US fishing fleet and support domestic shipyards. NMFS believes that requiring CCF program users to utilize their CCF funds for a qualified project at least once every ten years is reasonable. Extending the project start date by amendment could lead to continual extensions without ever undertaking a project which would not be consistent with the underlying intent of the statute to modernize the US fishing fleet.

    Comment 15: One entity believes that the rule prohibits electronically signed documents.

    Response: NMFS agrees that it would be advantageous to permit electronic submission of documents that require an original signature. At this time, we do not have the capabilities to accept electronic signatures. NMFS is optimistic that the option to file using an electronic signature will be available to program users in the future.

    Comment 16: One entity stated that there is no “grandfather” clause in the new regulations.

    Response: The applicability of the final rule to all past, present and future Agreements can be found in 50 CFR 259.10(d) and (e).

    Comment 17: One entity has requested that NMFS add a restriction to the rule that no project be allowed which does not reduce ocean noise pollution.

    Response: NMFS is in support of projects that reduce ocean noise pollution. However, NMFS believes the more appropriate forum for limiting noise pollution is through the Magnuson-Stevens Fishery Conservation and Management Act Fisheries Management Plans.

    Comment 18: Two entities believe that the Environmental Assessment prepared by NMFS lacked the detail required by the National Environmental Policy Act (NEPA) specifically in regards to the potential impacts of adding the harvesting capacity restrictions and twelve month timeframe constraints.

    Response: NMFS believes that the changes made in this final rule are largely administrative in nature and the implementation of this final action should have a nominal, if any, impact on the physical, biological, social and economic environments. Agreements involving projects that occur within a limited access system in which the fisheries management authority establishes harvesting limits will not be affected by any limitations on harvesting capacity. In addition, the final rule maintains the current eighteen month timeframe in accordance with existing regulations, rather than reducing the timeframe to twelve months as had been proposed.

    Summary of Revisions in the Final Rule

    1. Revises § 259.31(a) (redesignated § 259.3(a)) to eliminate the requirement that the Agreement holder reconstruct a used vessel acquired with CCF funds. This permits the acquisition of a used vessel without requiring that it be reconstructed;

    2. Revises § 259.31(b) (redesignated § 259.3(c)) to eliminate the requirement that the minimum cost of a reconstruction project be the lesser of $100,000 or 20% of the reconstructed vessel's acquisition cost. This provision eliminates making excessive capital improvements to vessels based upon an arbitrary amount. Instead, program participants will use the CCF to spend what is needed to improve the vessel. It also removes § 259.31(b)(2) because it was tied to the now eliminated minimum cost requirement;

    3. Revises § 259.31(b)(1) (redesignated § 259.4(a)) to add material increases in safety, reliability, or energy efficiency to the list of qualified reconstruction items.

    4. Eliminates the requirement in § 259.34(a) that the Agreement holder annually make a minimum deposit of 2% of the anticipated cost of the scheduled Agreement objectives. The Final rule also eliminates the minimum cost requirement in paragraphs (a)(1) and (2) of § 259.34. This change is consistent with our attempt to reduce the amount of CCF funds on deposit by not requiring excess deposits to meet an annual deposit requirement;

    5. Removes § 259.32 pertaining to “Conditional Fisheries.” “Conditional Fisheries” regulations were part of the Financial Aid Program Procedures contained in 50 CFR part 251 and were eliminated on April 3, 1996, under the authority of 16 U.S.C. 742.

    Sections are redesignated as necessary due to these changes.

    In addition to the changes easing restrictions on CCF projects, program regulations are amended as follows for purposes of simplicity, clarity, and brevity:

    1. A Definitions section is added (new § 259.1);

    2. Existing § 259.1 is removed because it deals only with deposits for taxable years beginning after December 31, 1969, and before January 1, 1972, and no such deposits remain;

    3. Section 259.30 is redesignated as § 259.2. Section 259.2(b)(1) adds the requirement that the application for an Agreement include the name and Tax Identification Number of the applicant, pursuant to the Debt Collection Improvement Act of 1996 (31 U.S.C. 3701, et seq.);

    4. Section 259.3(a) simplifies “Acquisition” requirements by removing the existing requirements when acquiring a used vessel;

    5. Section 259.3(b) is a new section pertaining specifically to “Construction,” which had been omitted as a separate section in the previous regulations;

    6. Section 259.3(c) replaces old § 259.31(b), and simplifies the requirements related to “Reconstruction” by incorporating the relevant language regarding energy and safety improvements from the deleted Sections 259.31(d) and (e);

    7. Section 259.33 is redesignated as § 259.4;

    8. Section 259.34 is redesignated as § 259.5 and eliminates the minimum deposit requirement;

    9. Section 259.6 is added to provide for termination of inactive accounts and accounts with zero balances on deposit, and to detail the notification procedures and time limit for resolving Agreement deficiencies to avoid termination;

    10. Section 259.35 is redesignated as § 259.7, and the requirement to submit a preliminary deposit and withdrawal report at the end of each calendar year is removed, because the preliminary report no longer serves a useful purpose and is not required by the Internal Revenue Service;

    11. Section 259.36 is redesignated § 259.8, and provisions relating to non-cash deposits or investments are dropped because they have never occurred;

    12. Section 259.37 is redesignated as § 259.9; and

    13. Section 259.38 is redesignated as § 259.10.

    Classification

    This final rule is published under the authority of, and is consistent with, Chapter 535 of the MMA. The NMFS Assistant Administrator has determined that this final rule is consistent with the Magnuson-Stevens Fishery Conservation and Management Act, as amended, and other applicable law.

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

    In compliance with the National Environmental Policy Act, NMFS prepared an environmental assessment (EA) for this final rule. The assessment discusses the impact of this final rule on the natural and human environment and integrates a Regulatory Impact Review (RIR) and a Final Regulatory Flexibility Analysis (FRFA). NMFS will send the assessment, the review and analysis to anyone who requests a copy (see ADDRESSES).

    NMFS prepared a FRFA, under section 604 of the Regulatory Flexibility Act (RFA), to describe the economic impacts this final rule has on small entities. The analysis aided us in considering regulatory alternatives that could minimize the economic consequences on affected small entities. The final rule does not duplicate or conflict with other Federal regulations.

    Summary of FRFA

    The RFA defines a “small business” as having the same meaning as a “small business concern” which is defined under Section 3 of the Small Business Act (SBA). 5 U.S.C. 601(3). Additionally, “small governmental jurisdictions” are defined as governments of cities, counties, towns, townships, villages, school districts, or special districts with populations of fewer than 50,000. 5 U.S.C. 601(5). As defined in the RFA, the small entities that this rule may affect include vessel owners, vessel operators, fish dealers, individual fishermen, small corporations, others engaged in commercial and recreational activities regulated by NOAA and native Alaskan governmental jurisdictions. In addition, the rule affects some larger businesses.

    Because the CCF is a voluntary program that provides tax deferred benefits to qualified applicants, we assume that newly participating entities large or small will not be negatively impacted by this rule. For current participants, the changes allow more flexibility in the use of the funds and, therefore, will only positively affect those entities.

    Description of the Number of Small Entities

    The small business size standard for businesses, including their affiliates, whose primary industry is commercial fishing is $11 million in annual gross receipts (see 50 CFR part 200.2(a)). Most of the 1,394 participants in the program, all of who are fishers, have annual gross revenues of less than $11 million, and are thus considered to be small entities. However, analysts cannot quantify the exact number of small entities that may choose to participate in the program and be directly regulated by this action, the net effects are expected to be positive relative to the status quo.

    Because the new regulations merely simplify existing CCF regulations and policies, this action does not create new reporting requirements for small entities participating in the CCF. Although the CCF requires certain supporting documentation during the life of the Agreement, the CCF's requirements do not impose unusual burdens. Those supporting documents are usually within the normal business records already maintained by small business entities, and include income tax returns, tax basis schedules, vessel ownership documents, etc. Depending on circumstances, the CCF may require other supporting documents that can be acquired at reasonable cost if they are not already available. We estimate it will take small entities fewer than 3.5 hours per application to meet these requirements.

    Because participation is voluntary and requires an average of 3.5 hours to prepare an application, all CCF applicants are assumed to have made a determination that they will incur a benefit by participating in the program. Consequently, it is assumed that the CCF's tax deferrals provide a positive economic impact. Importantly, the CCF does not regulate or manage the affairs of its program users, and the regulations impose no additional compliance obligations, operating costs or any other costs on small entities that did not exist in the original regulations.

    Because these regulations impose no significant costs on any small entities, but rather provide small and large entities with benefits, negative economic impacts on small entities, if any, are expected to be minimal at worst. The impact is likely to be positive. Accordingly, we have determined this rule does not substantially impact a significant number of small businesses.

    Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as “small entity compliance guides.” Even though a FRFA was not required, one was prepared. Copies of the FRFA are available upon request (see ADDRESSES). The information in this FRFA supports a determination that this rule will have beneficial effects on affected small entities. Therefore, NMFS has determined that this final rule will not have a substantial adverse economic impact on a substantial number of small entities. Since a FRFA was not required, “small entity compliance guides” will not be prepared.

    Paperwork Reduction Act

    Notwithstanding any other provisions of law, no person is required to respond to or be subject to a penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act (PRA) unless that collection of information displays a currently valid Office of Management and Budget (OMB) control number. This final rule contains no new collection of information requirements subject to the PRA. Existing collections have been approved by OMB under OMB Control No. 0648-0041. This collection includes the Deposit/Withdrawal Report, the Interim Capital Construction Fund Agreement and Certificate. The estimate of the annual total program public reporting burden for the Deposit/Withdrawal report is 1,200 hours. This equates to an average of less than 1 hour of annual reporting burden per program user. The estimates of the annual total program public reporting burden for the Interim Capital Construction Fund Agreement and Certificate is 2,250 hours. This equates to an average of 1 hour of annual reporting burden per existing program user and 3.5 hours of reporting burden for new applicants to the CCF program. The response time estimates above include the time needed for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and revising the collection of information.

    Send comments regarding the burden hour estimates, or any other aspect of this data collection, including suggestions for reducing the burden, to both NMFS and OMB (see ADDRESSES).

    The Assistant Administrator for Fisheries, NMFS, determined that this final rule does not affect the coastal zone of any state.

    The Assistant Administrator for Fisheries, NMFS, determined that this final rule does not affect endangered or threatened species, marine mammals, or critical habitat.

    This final rule does not contain policies with federalism implications under E.O. 13132.

    List of Subjects in 50 CFR Part 259

    Fisheries, Fishing vessels, Income taxes, Reporting and recordkeeping requirements.

    Dated: May 24, 2017. Alan D. Risenhoover, Acting Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service.

    For the reasons set out in the preamble, NMFS amends 50 CFR Chapter II by revising part 259 to read as follows:

    PART 259—CAPITAL CONSTRUCTION FUND TAX REGULATIONS Sec. 259.1 Definitions. 259.2 Applying for a Capital Construction Fund Agreement (“Agreement”). 259.3 Acquisition, construction, or reconstruction. 259.4 Constructive deposits and withdrawals; ratification of withdrawals (as qualified) made without first having obtained Secretary's consent; first tax year for which an Agreement is effective. 259.5 Maximum deposits and time to deposit. 259.6 Termination of inactive and zero balance accounts. 259.7 Annual deposit and withdrawal reports required. 259.8 CCF accounts. 259.9 Conditional consents to withdrawal qualification. 259.10 Miscellaneous. Authority:

    46 U.S.C. 53501, formerly 46 U.S.C. App. 1177 and 1177-1.

    § 259.1 Definitions.

    As used in this part:

    Act means Chapter 535 of Title 46 of the U.S. Code (46 U.S.C. 53501-53517), as may be amended from time to time.

    Agreement means the contract to participate in the program between the approved CCF applicant (party) and the Secretary.

    Agreement vessel means any eligible vessel or qualified vessel which is subject to an Agreement.

    Citizen of the United States means any person who is a United States citizen and any corporation or partnership organized under the laws of any state which meets the requirements for documenting vessels in the U.S. coastwise trade.

    Commercial fishing means fishing in which the fish harvested, either in whole or in part, are intended to enter commerce or enter commerce through sale, barter or trade.

    Depository means the bank or brokerage account(s) listed in the Agreement where the CCF funds will be physically held.

    Eligible vessel means—

    (1) A vessel—

    (i) Constructed in the United States (and, if reconstructed, reconstructed in the United States), constructed outside of the United States but documented under the laws of the United States on April 15, 1970, or constructed outside the United States for use in the United States foreign trade pursuant to a contract made before April 15, 1970;

    (ii) Documented under the laws of the United States if 5 net tons or greater; and

    (iii) Operated in the foreign or domestic commerce of the United States or in the fisheries of the United States; and

    (2) A commercial fishing vessel or vessel which will carry fishing parties for hire—

    (i) Constructed in the United States and, if reconstructed, reconstructed in the United States;

    (ii) State registered if at least 2 net tons but fewer than 5 net tons or Documented under the laws of the United States if 5 net tons or greater;

    (iii) Owned by a citizen of the United States;

    (iv) Having its home port in the United States; and

    (v) Operated in the commercial fisheries of the United States.

    Extension period means the first day following the end of the Filing period and ending on the last day of the party's last filing extension.

    Filing period means the first day following the end of the Tax Year and ending on the party's last day to file their tax return absent a filing extension.

    Limited Access System means a system that limits participation in a fishery to those satisfying certain eligibility criteria or requirements contained in a fishery management plan or associated regulation.

    Qualified vessel means—

    (1) A vessel—

    (i) Constructed in the United States (and, if reconstructed, reconstructed in the United States), constructed outside of the United States but documented under the laws of the United States on April 15, 1970, or constructed outside the United States for use in the United States foreign trade pursuant to a contract made before April 15, 1970;

    (ii) Documented under the laws of the United States if 5 net tons or greater; and

    (iii) Agreed, between the Secretary and the person maintaining the capital construction fund established under 46 U.S.C. 53503, to be operated in the fisheries of the United States; and

    (2) A commercial fishing vessel or vessel which will carry fishing parties for hire—

    (i) Constructed in the United States and, if reconstructed, reconstructed in the United States;

    (ii) State registered if at least 2 net tons but fewer than 5 net tons or Documented under the laws of the United States if 5 net tons or greater;

    (iii) Owned by a citizen of the United States;

    (iv) Having its home port in the United States; and

    (v) Operated in the commercial fisheries of the United States; and

    (3) Gear which is permanently fixed to the vessel. The expenditure for gear and certain nets which are not fixed to the vessel (pots, traps, longline, seine nets, gill set nets and gill drift nets) is excluded from the amount eligible for qualified withdrawals of CCF funds.

    Schedule A means the section of the Agreement that designates the income producing vessel from which deposits are made to a designated account.

    Schedule B means the section of the Agreement that designates the qualified project for which the CCF funds are to be expended.

    Secretary means the Secretary of Commerce with respect to eligible or qualified vessels operated or to be operated in the fisheries of the United States.

    Tax due date means the date the party's Federal tax return must be filed, including extensions, with the Internal Revenue Service.

    Tax year means the period between January 1 and December 31 for Calendar year filers or the designated fiscal year for fiscal year filers.

    United States means the United States of America and, for citizenship purposes, includes the Commonwealth of Puerto Rico, American Samoa, Guam, the U.S. Virgin Islands, the Republic of the Marshall Islands, the Federated States of Micronesia, the Commonwealth of the Northern Mariana Islands, and any other commonwealth, territory, or possession of the United States, or any political subdivision of any of them.

    § 259.2 Applying for a Capital Construction Fund Agreement (“Agreement”).

    (a) General qualifications. To be eligible to enter into an Agreement an applicant must:

    (1) Be a citizen of the United States (citizenship requirements are those necessary for documenting vessels in the coastwise trade within the meaning of section 2 of the Shipping Act, 1916, as amended);

    (2) Own or lease one or more eligible vessels (as defined at 46 U.S.C. 53501) operating in the foreign or domestic commerce of the United States;

    (3) Have an acceptable plan to acquire, construct, or reconstruct one or more qualified vessels (as defined at 46 U.S.C. 53501). The plan must be a firm representation of the applicant's actual intentions. Qualified vessels must be for commercial operation in the fisheries of the United States. If the vessel is 5 net tons or over, it must be documented with a fishery trade endorsement. Dual documentation in both the fisheries and the coastwise trade of the United States is permissible. Any vessel which will carry fishing parties for hire must be inspected and certified (under 46 CFR part 176) by the U.S. Coast Guard as qualified to carry more than six passengers. If the vessel weighs fewer than 5 net tons the party must demonstrate to the Secretary's satisfaction that the carrying of fishing parties for hire will constitute its primary activity.

    (b) Content of application. Applicants seeking an Agreement must submit a formal application providing the following information:

    (1) Name and Tax Identification Number (TIN) of applicant;

    (2) Proof of U.S. citizenship;

    (3) The first taxable year for which the Agreement is to apply (see § 259.4 for the latest time at which applications for an Agreement relating to the previous taxable year may be received);

    (4) The following information regarding each eligible vessel which is to be incorporated in Schedule A of the Agreement:

    (i) Name of vessel,

    (ii) Official number or, in the case of vessels weighing under 5 net tons, the State registration number, where required,

    (iii) Type of vessel (i.e., catching vessel, processing vessel, transporting vessel, charter vessel, barge, passenger carrying fishing vessel, etc.),

    (iv) General characteristics (i.e., net tonnage, fish-carrying capacity, age, length, type of fishing gear, number of passengers carried or in the case of vessels operating in the foreign or domestic commerce the various uses of the vessel, etc.),

    (v) Whether it is owned or leased and, if leased, the name of the owner, and a copy of the lease,

    (vi) Date and place of construction,

    (vii) If reconstructed, date of redelivery and place of reconstruction,

    (viii) Trade (or trades) in which the vessel is documented and date last documented,

    (ix) The fishery of operation (which in this section means each species or group of species). Each species must be specifically identified by the acceptable common names of fish, shellfish, or other living marine resources which each vessel catches, processes, or transports or will catch, process, or transport for commercial purposes such as marketing or processing the catch),

    (x) The area of operation (which for fishing vessels means the general geographic areas in which each vessel will catch, process, or transport, or charter for each species or group of species of fish, shellfish, or other living marine resources),

    (5) The specific objectives to be achieved by the accumulation of assets in a Capital Construction Fund (to be incorporated in Schedule B of the Agreement) including:

    (i) Number of vessels,

    (ii) Type of vessel (i.e., catching, processing, transporting, or passenger carrying fishing vessels),

    (iii) General characteristics (i.e., net tonnage, fish-carrying capacity, age, length, type of fishing gear, number of passengers carried),

    (iv) Cost of projects,

    (v) Amount of indebtedness to be paid for vessels to be constructed, acquired, or reconstructed (all notes, mortgages, or other evidence of indebtedness must be submitted as soon as available, together with sufficient additional evidence to establish that full proceeds of the indebtedness to be paid from a CCF account under an Agreement, were used solely for the purpose of the construction, acquisition, or reconstruction of Schedule B vessels),

    (vi) Date of construction, acquisition, or reconstruction,

    (vii) Fishery of operation (which in this section means each species or group of species must be specifically identified by acceptable common name of fish, shellfish, or other living marine resources), and

    (viii) Area of operation (which in this section means the general geographic areas in which each vessel will operate for each species or group of species of fish, shellfish, or other living marine resources),

    (c) Filing. The application must be signed and submitted to the Financial Services Division of the National Marine Fisheries Service. As a general rule, the Agreement must be executed and entered into by the taxpayer on or prior to the due date for the filing of the Federal tax return in order to be effective for the tax year to which that return relates. It is in the Applicant's best interest to file at least 45 days in advance of such date.

    § 259.3 Acquisition, construction, or reconstruction.

    CCF funds cannot be used for any vessel acquisition, construction, or reconstruction that increases harvesting capacity in a fishery or fisheries, other than in a limited access system in which the fisheries management authority establishes harvesting limits.

    (a) Acquisition. CCF funds can be used to acquire any used qualified vessel that will fish in a limited access system in which the fisheries management authority establishes harvesting limits. If the fishery or fisheries is not a limited access system, CCF funds can only be used to replace an existing, recently sunken, or scrapped vessel and its existing harvesting capacity. The replaced vessel must lose its fisheries trade endorsement and the vessel owner must notify the Coast Guard Documentation Center of that fact.

    (b) Construction. CCF funds can be used to construct a new qualified vessel that will fish in a limited access system in which the fisheries management authority establishes harvesting limits. If the fishery or fisheries is not a limited access system, CCF funds can only be used to replace an existing, recently sunken, or scrapped vessel and its existing harvesting capacity. The replaced vessel must lose its fisheries trade endorsement and the vessel owner must notify the Coast Guard Documentation Center of that fact.

    (c) Reconstruction. Reconstruction may include rebuilding, replacing, reconditioning, refurbishing, repairing, converting and/or improving any portion of a vessel. A reconstruction project must, however, either substantially prolong the useful life of the reconstructed vessel, increase its value, materially increase its safety, reliability, or energy efficiency, or adapt it to a different commercial use in the fishing trade or industry. No vessel more than 25 years old at the time of withdrawal shall be a qualified vessel for the purpose of reconstruction unless a special showing is made, to the Secretary's discretionary satisfaction, that the type and degree of reconstruction intended will result in an efficient and productive vessel with an economically useful life of at least 10 years beyond the date reconstruction is completed.

    (d) Time permitted for construction or reconstruction. Construction or reconstruction must be completed within 18 months from the date construction or reconstruction first commences, unless otherwise consented to by the Secretary.

    § 259.4 Constructive deposits and withdrawals; ratification of withdrawals (as qualified) made without first having obtained Secretary's consent; first tax year for which an Agreement is effective.

    (a) Constructive deposits and withdrawals (before Agreement executed date). Constructive deposits and withdrawals are deemed to have been deposited to and withdrawn from a designated CCF account even though the funds were not physically deposited. Constructive deposits and withdrawals shall be permissible only during the “Tax Year” for which a written application for an Agreement is submitted to the Secretary. Once the Secretary executes the Agreement, the constructive deposit and withdrawal period ends. All deposits must be physically deposited into a designated CCF account.

    (1) All qualified deposits and expenditures occurring within the period specified directly above, that are within the eligible ceilings specified at 46 U.S.C. 53505, may be consented to by the Secretary as constructive deposits and withdrawals. In order for the Secretary to provide his or her consent for constructive deposit and withdrawal treatment, the applicant must include a written request with the application and provide sufficient supporting data to enable the Secretary to evaluate the request. This written request must be submitted no later than the “Extension Period” for that party's initial tax year.

    (2) [Reserved]

    (b) Constructive deposits and withdrawals (after the Agreement effective date). The Secretary shall not permit constructive deposits or withdrawals after the effective date of an Agreement. Deposits made after the effective date of an Agreement must be physically deposited into a dedicated CCF account.

    (c) First tax year for which an Agreement is effective. In order for an Agreement to be effective for any applicant's “Tax Year,” the written application must be submitted to the Secretary before the end of the “Filing Period” or “Extension Period” for that tax year, whichever applies. If the written application is received by the Secretary, after the end of the “Filing Period” or “Extension Period,” whichever applies, then the Agreement will be first effective for the next succeeding “Tax Year.”

    (1) It is in the applicant's best interest to submit his or her written application at least 45 days in advance of the end of his or her tax due date. If the written application is submitted too close to the tax due date, and the Secretary is not ultimately able to execute the Agreement, the applicant must bear the burden of negotiating with the Internal Revenue Service for relief. The Secretary shall regard any penalties related to this denied application as due to the applicant's failure to apply for an Agreement in a timely manner.

    (2) [Reserved]

    (d) Ratification of withdrawals, as qualified, made without first having obtained Secretary's prior consent. Any withdrawals made after the effective date of an Agreement without the Secretary's consent are automatically non-qualified withdrawals, unless the Secretary subsequently consents to them by ratification.

    (1) The Secretary may ratify, as qualified, any withdrawal made without the Secretary's prior consent, provided the withdrawal would have resulted in the Secretary's consent had it been requested before withdrawal.

    (2) The Secretary may issue his or her retroactive consent, if appropriate, as work priorities permit. However, if the Secretary is unable to issue retroactive consent for withdrawals made without his or her consent, then those withdrawals, and any associated penalties, will be deemed due to the party's failure to apply in a timely manner.

    (3) It is recommended that a party submit his or her request for withdrawal at least 45 days in advance of the expected date of withdrawal. Withdrawals made without the Secretary's consent, in reliance on obtaining the Secretary's consent, are made purely at a party's own risk. Should any withdrawal made without the Secretary's consent prove, for any reason, to be one which the Secretary will not or cannot consent to ratify, then the result will be an unqualified withdrawal and/or an involuntary termination of the Agreement.

    (4) Should a party withdraw CCF funds for a project not previously deemed an eligible Schedule B objective without having first obtained the Secretary's consent, the Secretary may entertain an application to amend the Agreement's Schedule B objectives as the prerequisite to consenting by ratification to the withdrawal.

    (5) Redeposit of any withdrawals made without the Secretary's consent, and for which such consent is not subsequently given (either by ratification or otherwise), shall not be permitted. If the non-qualified withdrawal adversely affects the Agreement's general status the Secretary may terminate the Agreement.

    § 259.5 Maximum deposit amounts and time to deposit.

    (a) Other than the maximum annual ceilings established by the Act, the Secretary shall not establish an annual ceiling. However, deposits can no longer be made once a party has deposited 100 percent of the anticipated cost of all Schedule B objectives unless the Agreement is then amended to establish additional Schedule B objectives.

    (b) Ordinarily, the Secretary shall permit deposits to accumulate prior to commencement of any given Schedule B objective for a maximum of ten years. However, at the Secretary's sole discretion and based on good and sufficient cause shown, the time period may be extended.

    § 259.6 Termination of inactive and zero balance accounts.

    (a) If a Schedule B objective has not commenced within 10 years from the date the Agreement was established, and has not been extended by written approval of the Secretary, the Agreement is considered inactive and subject to termination.

    (b) If the account balance of all depositories of an Agreement is zero dollars 10 years after the date it was established, and has not been extended through amendment, the Agreement is considered inactive and subject to termination unless its Schedule B objective has commenced.

    (c) A certified letter will be sent to holders of Agreements identified for termination informing them that the agreement will terminate 60 days after the date of the letter unless the deficiencies identified in the letter are addressed.

    § 259.7 Annual deposit and withdrawal reports required.

    (a) The Secretary will require from each party an annual deposit and withdrawal report for each CCF depository. Failure to submit such reports may be cause for involuntary termination of the party's Agreement.

    (1) A final deposit and withdrawal report at the end of the tax year, which shall be submitted not later than 30 days after expiration of the due date, for filing the party's Federal income tax return. The report must be made on a form prescribed by the Secretary using a separate form for each CCF depository.

    (2) Each report must bear a certification that the deposit and withdrawal information given includes all annual deposit and withdrawal activity for each CCF depository. Negative reports must be submitted in those cases where there is no deposit and/or withdrawal activity.

    (b) The Secretary, at his or her discretion, may, after due notice, disqualify withdrawals and/or involuntarily terminate the Agreement for the participant's failure to submit the required annual deposit and withdrawal reports.

    (c) Additionally, each party shall submit, not later than 30 days after expiration of the party's tax due date, a copy of the party's Federal Income Tax Return filed with IRS for the preceding tax year. Failure to submit the Federal Income Tax Return shall, after due notice, be cause for the same adverse action specified in paragraph (b) of this section.

    § 259.8 CCF accounts.

    (a) General. Each CCF account in a scheduled depository shall have an account number, which must be reflected on the reports required by § 259.7. All CCF accounts shall be reserved only for CCF transactions. There shall be no intermingling of CCF and non-CCF transactions and there shall be no pooling of 2 or more CCF accounts without the prior consent of the Secretary. Safe deposit boxes, safes, or the like shall not be eligible CCF depositories without the Secretary's consent, which shall be granted solely at his or her discretion.

    (b) Assignment. The use of funds held in a CCF depository for transactions in the nature of a countervailing balance, compensating balance, pledge, assignment, or similar security arrangement shall constitute a material breach of the Agreement unless prior written consent of the Secretary is obtained.

    (c) Depositories. Section 53506(a) of the Act provides that amounts in a CCF account must be kept in a depository or depositories specified in the Agreements and be subject to such trustee or other fiduciary requirements as the Secretary may require. Unless otherwise specified in the Agreement, the party may select the type or types of accounts in which the assets of the Fund may be deposited.

    § 259.9 Conditional consents to withdrawal qualification.

    The Secretary may conditionally consent to the qualification of a withdrawal. This consent is conditioned upon the timely submission, to the Secretary, of the items requested by the Secretary in the withdrawal approval letter. Failure to provide these items in a timely manner, and after due notice, will result in nonqualification of the withdrawal and/or involuntary termination of the Agreement.

    § 259.10 Miscellaneous.

    (a) Wherever the Secretary prescribes time constraints, the postmark date shall control if mailed. If a private delivery service is used, including Federal Express or United Parcel Service, the date listed on the label shall control. Submission of CCF transactions by email or facsimile is only allowable when an original signature is not required.

    (b) All CCF information received by the Secretary shall be held strictly confidential to the extent permitted by law, except that it may be published or disclosed in statistical form provided such publication does not disclose, directly or indirectly, the identity of the fund holder.

    (c) While recognizing that precise regulations are necessary in order to treat similarly situated parties similarly, the Secretary also realizes that precision in regulations can sometimes cause inequitable effects to result from unavoidable, unintended, or minor discrepancies between the regulations and the circumstances they attempt to govern. The Secretary will, consequently, at his or her discretion, as a matter of privilege and not as a matter of right, attempt to afford relief to parties where literal application of the purely procedural, as opposed to substantive, aspects of these regulations would otherwise work an inequitable hardship. This privilege will be sparingly granted and no party should act in reliance on its being granted.

    (d) These §§ 259.1 through 259.10 are applicable to all Agreements first entered into (or amended) on or after the date these sections are adopted.

    (e) These §§ 259.1 through 259.10 are specifically incorporated in all Agreements existing prior to the date these sections are adopted.

    [FR Doc. 2017-11083 Filed 5-26-17; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 648 [Docket No. 151211999-6343-02] RIN 0648-XF467 Fisheries of the Northeastern United States; Northeast Multispecies Fishery; American Plaice Trimester Total Allowable Catch Area Closure for the Common Pool Fishery AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Temporary rule; area closure.

    SUMMARY:

    This action closes the American Plaice Trimester Total Allowable Catch Area to Northeast multispecies common pool vessels fishing with trawl gear for the remainder of Trimester 1, through August 31, 2017. The closure is required by regulation because the common pool fishery has caught 90 percent of its Trimester 1 quota for American plaice. This closure is intended to prevent an overage of the common pool's quota for this stock.

    DATES:

    This action is effective May 24, 2017, through August 31, 2017.

    FOR FURTHER INFORMATION CONTACT:

    Reid Lichwell, Fishery Management Specialist, (978) 281-9112.

    SUPPLEMENTARY INFORMATION:

    Federal regulations at § 648.82(n)(2)(ii) require the Regional Administrator to close a common pool Trimester Total Allowable Catch (TAC) Area for a stock when 90 percent of the Trimester TAC is projected to be caught. The closure applies to all common pool vessels fishing with gear capable of catching that stock for the remainder of the trimester.

    As of May 21, 2017, the common pool fishery caught approximately 90 percent of the Trimester 1 TAC (5.2 mt) for American plaice. Effective May 24, 2017, the American plaice Trimester TAC Area is closed for the remainder of Trimester 1, through August 31, 2017, to all common pool vessels on a Northeast multispecies day-at-sea fishing with trawl gear. The American Plaice Trimester TAC Area consists of statistical areas 512, 513, 514, 515, 521, 522, and 525. The area reopens at the beginning of Trimester 2 on September 1, 2017.

    If a vessel declared its trip through the Vessel Monitoring System (VMS) or the interactive voice response system, and crossed the VMS demarcation line prior to May 24, 2017, it may complete its trip within the Trimester TAC Area.

    Any overage of the Trimester 1 or 2 TACs must be deducted from the Trimester 3 TAC. If the common pool fishery exceeds its total quota for a stock in the 2017 fishing year, the overage must be deducted from the common pool's quota for that stock for fishing year 2018. Any uncaught portion of the Trimester 1 and Trimester 2 TACs is carried over into the next trimester. However, any uncaught portion of the common pool's total annual quota may not be carried over into the following fishing year.

    Weekly quota monitoring reports for the common pool fishery are on our Web site at: http://www.greateratlantic.fisheries.noaa.gov/ro/fso/MultiMonReports.htm. We will continue to monitor common pool catch through vessel trip reports, dealer-reported landings, VMS catch reports, and other available information and, if necessary, we will make additional adjustments to common pool management measures.

    Classification

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

    The Assistant Administrator for Fisheries, NOAA, finds good cause pursuant to 5 U.S.C. 553(b)(B) and 5 U.S.C. 553(d)(3) to waive prior notice and the opportunity for public comment and the 30-day delayed effectiveness period because it would be impracticable and contrary to the public interest.

    The regulations require the Regional Administrator to close a trimester TAC area to the common pool fishery when 90 percent of the Trimester TAC for a stock has been caught. Updated catch information only recently became available indicating that the common pool fishery has caught 90 percent of its Trimester 1 TAC for American plaice as of May 21, 2017, and 100 percent of the TAC will likely be caught by May 23. The time necessary to provide for prior notice and comment, and a 30-day delay in effectiveness, would prevent the immediate closure of the American Plaice Trimester 1 TAC Area. This increases the likelihood that the common pool fishery will exceed its annual quota of American plaice to the detriment of this stock, which could undermine management objectives of the Northeast Multispecies Fishery Management Plan. Additionally, an overage of the trimester or annual common pool quotas could cause negative economic impacts to the common pool fishery as a result of overage paybacks deducted from a future trimester or fishing year.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: May 24, 2017. Margo B. Schulze-Haugen, Acting Deputy Director, Office of Sustainable Fisheries, National Marine Fisheries Service.
    [FR Doc. 2017-11058 Filed 5-24-17; 4:15 pm] BILLING CODE 3510-22-P
    82 102 Tuesday, May 30, 2017 Proposed Rules NATIONAL CAPITAL PLANNING COMMISSION 1 CFR Chapter VI National Environmental Policy Act Regulations. AGENCY:

    National Capital Planning Commission

    ACTION:

    Proposed rule; public meetings.

    SUMMARY:

    The National Capital Planning Commission (NCPC or Commission) proposes to adopt new regulations governing NCPC's implementation of the National Environmental Policy Act (NEPA) and regulations promulgated by the Council on Environmental Quality (CEQ). Federal agencies and NCPC on behalf of non-federal agencies must comply with the requirements of NEPA and CEQ regulations for projects submitted to the Commission for review and approval.

    DATES:

    Submit comments on or before July 14, 2017. Public meetings to discuss the proposed Policies and Procedures will be held on Tuesday, June 13, 2017 from 6:00 p.m.-7:30 p.m. and Thursday, June 15, 2017 from 9:30 a.m.-11:00 a.m. Both meetings will be held at the National Capital Planning Commission, 401 9th Street NW., Suite 500, Washington, DC 20004.

    ADDRESSES:

    You may submit written comments on the proposed Policies and Procedures by either of the methods listed below.

    1. U.S. mail, courier, or hand delivery: Anne R. Schuyler, General Counsel/National Capital Planning Commission, 401 9th Street NW., Suite 500, Washington, DC 20004.

    2. Electronically: [email protected]

    FOR FURTHER INFORMATION CONTACT:

    Anne R. Schuyler, General Counsel at 202-482-7223 or [email protected]

    SUPPLEMENTARY INFORMATION:

    The current regulation are published on the NCPC Web site at the following location: https://www.ncpc.gov/ncpc/Main(T2)/ProjectReview(Tr2)/ProjectReview(Tr3)/SubmissionGuidelines.html?sgpage=3. These regulations lay out the process federal agencies and NCPC on behalf of non-federal agencies must follow to ensure NEPA compliance. While the subject regulations are critical to the Commission's ability to carry out its review authorities, they have not been updated since 2004. As such, NCPC proposes revisions to its Environmental Policies and Procedures to simplify the regulations and streamline the agency's NEPA process. In this proposal, NCPC is also proposing to establish a new chapter (chapter VI) in title 1 of the Code of Federal Regulations (CFR) to promote orderly codification. As the NCPC updates its regulations currently found in 1 CFR parts 455, 456 and 457 it will move them to its new chapter VI in title 1.

    Key Changes Incorporated Into NCPC's Proposed Environmental Policies and Procedures

    NCPC's current NEPA procedures were adopted in 2004 and generally remain appropriate and effective. However certain portions of the existing policies and procedures require revision to simplify, streamline, and improve the effectiveness of NCPC's process for complying with NEPA.

    One of the most significant changes incorporated into the proposed Environmental Policies and Procedures (Policies and Procedures) is the elimination of procedures for complying with Section 106 of the National Historic Preservation Act (NHPA). In 2004, when it adopted its current regulations, NCPC opted to issue combined NEPA and the NHPA regulations to ensure coordinated implementation of both procedures. However, regulations promulgated by the ACHP do not require agencies to adopt agency specific processes and procedures. Instead ACHP regulations establish the processes and procedures all federal agencies must follow. This resulted in the inclusion of duplicative information in NCPC's current policies and procedures. While this information proved helpful, it diverted attention away from NCPC's agency specific NEPA policies and procedures mandated by CEQ. Accordingly, the proposed Policies and Procedures delete detailed references to Section 106 consultation procedures. They do retain references to coordination between NEPA and NHPA and consideration of historic resources in the NEPA process.

    To clarify roles and responsibilities, the proposed Policies and Procedures distinguish between federal agency applicants and non-federal agency applicants. Federal agency applicants include cabinet level departments and executive agencies such as the U.S. General Services Administration (GSA). Non-federal agency applicants include, without limitation, the Smithsonian Institution, the John F. Kennedy Center for the Performing Arts, the National Gallery of Art, the US Institute of Peace, the Government of the District of Columbia, the Maryland National Capital Park and Planning Commission (MNCPPC) and private parties implementing projects on federal land. NCPC's jurisdiction extends to non-federal agency applicants when they undertake projects on federally-owned land. Under the proposed Policies and Procedures, NCPC serves as lead agency when the applicant is a non-federal agency. While this deviates from current practice, the proposal ensures NCPC a prominent role in the NEPA process and the ability to ensure consideration of its views.

    The proposed Policies and Procedures also alter the timing and sequencing of an applicant's submission of NEPA documentation for applications governed by the National Capital Planning Act and the Commemorative Works Act. Under the current regulations, an applicant must complete the NEPA process at the time of preliminary review. Under the proposed regulations, an applicant must complete its NEPA process at the time of final review. This revised approach allows the Commission an opportunity to provide input on a project when it is still in the developmental phase. It also provides a NEPA sequencing consistent with federal agency project development schedules. This eliminates the pressure on federal agency applicants to expedite its NEPA process to meet NCPC's current sequencing policies.

    NCPC also proposes several changes to its list of projects eligible for application of a CATEX. NCPC proposes to eliminate three existing CATEXs because they are based on old, antiquated authorities which have little to no relationship to NCPC's present day review roles. NCPC proposes to add four new CATEXs and to increase the number of extraordinary circumstances with the potential to negate application of CATEXs. The new CATEXs and extraordinary circumstances reflect matters addressed in federal, state and local laws and regulations and Executive Orders applicable to projects that come before NCPC.

    Section by Section Analysis of NCPC's Proposed Environmental Policies and Procedures

    Subpart A—General. This subpart contains three subsections addressing purpose, policy and definitions.

    § 601.1 Purpose. This section presents a clear, succinct statement of purpose.

    § 601.2 Policies. This section states NCPC's policies implementing NEPA. The content is similar to that of the existing policies and procedures, but the proposed Policies and Procedures consolidate all policies into one section. The existing Policies and Procedures disperse NCPC's NEPA policies throughout multiple sections.

    § 601.3 Definitions. This section defines terms frequently used in the document. It deletes definitions from the existing regulations that are infrequently or no longer used in the proposed regulations.

    Subpart B—Lead and Cooperating Agencies. This subpart assigns lead and cooperating agency status and states the obligations required of an applicant depending on their assigned status.

    § 601.4 Designation of Lead Agency. This section confers lead agency status on federal agency applicants and upon NCPC when the applicant is a non-federal agency. By definition, a federal agency means the executive agencies defined in 5 U.S.C. 105. A non-federal agency applicant means those applicants outside the statutory definition of federal agency that undertake projects on federal land and include, without limitation, the Smithsonian Institution, the John F. Kennedy Center for the Performing Arts, the National Gallery of Art, the U.S. Institute of Peace, the Government of the District of Columbia, MNCPPC, and private parties undertaking development on federal land.

    §  601.5 Lead Agency obligations. This section lists the general obligations of a lead agency.

    § 601.6 Resolving disputes over Lead Agency status. The section includes a dispute resolution provision for circumstances when there is a disagreement over which agency serves as the lead.

    § 601.7 Cooperating Agencies. This section lists the obligations of NCPC when it serves as a cooperating agency and requires non-federal agencies to comply with the same obligations when NCPC serves as lead agency.

    Subpart C—NEPA Submission Schedules. This subpart establishes the NEPA submission schedule for applications reviewed by the Commission pursuant to the Planning Act and the Commemorative Works Act.

    § 601.8 NEPA Submission schedule for applications governed by the National Capital Planning Act. This section establishes a revised NEPA submission schedule as follows: Initiation of scoping at the time of concept review; issuance of a draft environmental document (EA or EIS) at the time of preliminary review; and issuance of a final environmental document and final determination (FONSI or ROD) at the time of final review. The section also addresses the NEPA process to be undertaken by NCPC as the lead agency when emergency circumstances exist and application of a CATEX is not possible.

    § 601.9 NEPA submission schedule for applications governed by the Commemorative Works Act. This section establishes a new NEPA submission schedule as follows: Commencement of the NEPA process at the time of concept site and concept design review; issuance of a draft environmental document for public review at the time of preliminary approval of a site and design; and issuance of a final environmental document and a final determination (FONSI or ROD) at the time of final site and design review.

    Subpart D—Initiating the NEPA Process. This subpart describes the characteristics of Commission actions eligible for a CATX, lists the extraordinary circumstances that may negate the application of a CATEX, and lists NCPC's CATEXs.

    § 601.10 Characteristics of Commission actions eligible for a Categorical Exclusion.This section lists four types of actions the generally qualify for application of a CATEX:

    § 601.11 Extraordinary Circumstances. This section list ten extraordinary circumstances that may negate NCPC's application of a CATEX. Current regulations specify only five extraordinary circumstances.

    § 601.12 National Capital Planning Commission Categorical Exclusions. This section lists ten categorical exclusions available for use by NCPC. It includes a few new, but minor types of projects eligible for categorical exclusion and removes some existing CATEX based on old, antiquated authorities.

    Subpart E—Environmental Assessments. This subpart identifies the characteristics of Commission actions eligible for an EA; the specific types of Commission actions eligible for an EA; the contents, process for preparing, and process for adopting an EA; the process for closing out the EA process; and the requirements for determining when a supplemental EA should be prepared.

    § 601.13 Characteristics of Commission actions eligible for and Environmental Assessment. This section lists four characteristics that generally render a Commission action eligible for an EA.

    § 601.14 Commission actions generally eligible for an Environmental Assessment. This section lists five specific actions of the Commission which comply with the criteria listed in § 601.13 above and, therefore, qualify for preparation of an EA.

    § 601.15 Preparing an Environmental Assessment. This section provides general guidance on the contents of an EA and the entities to be involved in the preparation of the document. The section also authorizes NCPC's Executive Director to undertake a public scoping process for an EA if he/she determines it to be appropriate, outlines the public scoping process, and authorizes NCPC in its discretion to solicit public comment on a draft EA.

    § 601.16 Finding of No Significant Impact. This section directs NCPC as the lead agency to prepare a FONSI, if warranted, at the conclusion of the EA process. It also provides NCPC the option of either co-signing the lead agency's FONSI or preparing its own FONSI when NCPC serves as a cooperating agency. The section also specifies remedies the Commission can pursue when a lead agency's EA fails to support a FONSI.

    § 601.17 Supplemental Environmental Assessments. This section establishes when a supplemental EA may be warranted.

    Subpart F—Environmental Impact Statements. This subpart establishes the requirement for and timing of an EIS; links the requirement for an EIS to the context and intensity of impacts; requires use of techniques that minimize the length of an EIS; authorizes use of programmatic EISs and tiering; lists the contents of an EIS; sets forth the process for preparing an EIS; addresses preparation and issuance of a Final EIS; and addresses the preparation, and issuance of a ROD.

    § 601.18 Requirement and timing of an Environmental Impact Statement. This section requires NCPC preparation of an EIS on behalf on non-federal agency applicants, prior to the Commission's approval of a major federal action that has the potential to significantly affect the quality of the human environment.

    § 601.19 Context, intensity and significance of impacts. This section requires the determination on whether an EIS is necessary and whether an impact is significant based on the context and intensity of a project's impacts. The section discusses the meaning of context and intensity and lists the characteristics that render projects significant.

    § 601.20 Streamlining Environmental Impact Statements. This section requires NCPC to minimize the length of an EIS when NCPC serves as the lead agency and lists techniques that can achieve this result.

    § 601.21 Programmatic Environmental Impact Statements and tiering. This section authorizes use of a PEA and PEIS to assess the impacts of proposed plans and projects when there is uncertainty regarding the timing, the location, and the environmental impacts of subsequent implementing actions. When NCPC proceeds with a specific action, it authorizes the use of tiering or working from where the PEA or PEIS left off to define specific issues associated with the proposed action.

    § 601.22 Contents of an Environmental Impact Statement. This section enumerates the specific sections and contents that must be included in an EIS when NCPC is lead agency.

    § 601.23 The Environmental Impact Statement process. This section specifies the parties that must be included in the draft EIS preparation process, the process to follow for determining the scope of an EIS, and the process for obtaining public comment when NCPC is lead agency.

    § 601.24 Final Environmental Impact Statement. This section provides for the preparation of a final EIS responsive to public comments and provides for a forty five-day Commission-sponsored review period of the final EIS before the Commission takes action when NCPC is lead agency.

    § 601.25 Record of Decision. This section requires the preparation of a ROD stating the Commission's decision and any conservation or mitigation measures required by the Commission when NCPC is lead agency. It also lists the required contents of a ROD. This section enables NCPC to co-sign the ROD of the lead agency if NCPC serves as a cooperating agency and concurs with the applicant's ROD.

    § 601.26 Supplemental Environmental Impact Statement. This section specifies a supplemental EIS may be warranted if the original document is more than five years old and changed project specifications or new circumstances or information exist.

    § 601.27 Legislative Environmental Impact Statement. This sections requires NCPC to prepare an EIS when initiating the submission of draft legislation to Congress.

    Subpart G—Dispute Resolution. This subpart sets forth a mechanism for dispute resolution.

    § 601.28Dispute resolution. Unless a specific dispute resolution is invoked elsewhere in the Policies and Procedures, this section requires disputes arising under the Policies and Procedures to be resolved through interagency negotiations starting at the working levels and rising to the level necessary to resolve the dispute. If disputes cannot be settled through interagency negotiations, the parties are required to engage in mediation.

    Compliance With Laws and Executive Orders 1. Executive Orders 12866 and 13563

    By Memorandum dated October 12, 1993 from Sally Katzen, Administrator, Office of Information and Regulatory Affairs (OIRA) to Heads of Executive Departments and Agencies, and Independent Agencies, OMB rendered the NCPC exempt from the requirements of Executive Order 12866 (See, Appendix A of cited Memorandum). Nonetheless, NCPC endeavors to adhere to the provisions of Executive Orders and developed this proposed rule in a manner consistent with the requirements of Executive Order 13563. NCPC worked closely with CEQ on the derivation of the proposed Policies and Procedures and intends to work with the land-holding agencies and certain non-federal agencies impacted by these during the public comment period.

    2. Executive Order 13771

    By virtue of its exemption from the requirements of EO 12866, NCPC is exemption from this executive order. NCPC confirmed this fact with OIRA.

    3. Regulatory Flexibility Act

    As required by the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), the NCPC certifies that the proposed rule will not have a significant economic effect on a substantial number of small entities.

    4. Small Business Regulatory Enforcement Fairness Act

    This is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. It does not have an annual effect on the economy of $100 million or more; will not cause a major increase in costs for individuals, various levels of governments or various regions; and does not have a significant adverse effect on completion, employment, investment, productivity, innovation or the competitiveness of US enterprises with foreign enterprises.

    5. Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq.)

    A statement regarding the Unfunded Mandates Reform Act is not required. The proposed rule neither imposes an unfunded mandate of more than $100 million per year nor imposes a significant or unique effect on State, local or tribal governments or the private sector.

    6. Federalism (Executive Order 13132)

    In accordance with Executive Order 13132, the proposed rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment. The proposed rule does not substantially and directly affect the relationship between the Federal and state governments.

    7. Civil Justice Reform (Executive Order 12988)

    The General Counsel of NCPC has determined that the proposed rule does not unduly burden the judicial system and meets the requirements of Executive Order 12988 3(a) and 3(b)(2).

    8. Paperwork Reduction Act

    The proposed rule does not contain information collection requirements, and it does not require a submission to the Office of Management and Budget under the Paperwork Reduction Act.

    9. National Environmental Policy Act

    The proposed rule is of an administrative nature, and its adoption does not constitute a major federal action significantly affecting the quality of the human environment. NCPC's adoption of the proposed rule will have minimal or no effect on the environment; impose no significant change to existing environmental conditions; and will have no cumulative environmental impacts.

    10. Clarity of the Regulation

    Executive Order 12866, Executive Order 12988, and the Presidential Memorandum of June 1, 1998 requires the NCPC to write all rules in plain language. NCPC maintains the proposed rule meets this requirement. Those individuals reviewing the proposed rule who believe otherwise should submit specific comments to the addresses noted above recommending revised language for those provision or portions thereof where they believe compliance is lacking.

    11. Public Availability of Comments

    Be advised that personal information such as name, address, phone number electronic address, or other identifying personal information contained in a comment may be made publically available. Individuals may ask NCPC to withhold the personal information in their comment, but there is no guarantee the agency can do so.

    List of Subjects in 1 CFR Part 601

    Environmental Policies and Procedures.

    For the reasons stated in the preamble, the National Capital Planning Commission proposes to establish 1 CFR chapter VI, consisting of part 601, to read as follows:

    CHAPTER VI—NATIONAL CAPITAL PLANNING COMMISSION PART 601—ENVIRONMENTAL POLICIES AND PROCEDURES Subpart A—General Sec. 601.1 Purpose. 601.2 Policies. 601.3 Definitions. Subpart B—Lead and Cooperating Agencies 601.4 Designation of Lead Agency. 601.5 Lead Agency obligations. 601.6 Resolving disputes over Lead Agency status. 601.7 Cooperating Agencies. Subpart C—NEPA Submission Schedules 601.8 NEPA submission schedule for applications governed by the National Capital Planning Act. 601.9 NEPA submission schedule for applications governed by the Commemorative Works Act. Subpart D—Initiating the NEPA Process 601.10 Characteristics of Commission actions eligible for a Categorical Exclusion. 601.11 Extraordinary Circumstances. 601.12 National Capital Planning Commission Categorical Exclusions. Subpart E—Environmental Assessments 601.13 Characteristics of Commission actions eligible for an Environmental Assessment. 601.14 Commission actions generally eligible for an Environmental Assessment. 601.15 Process for preparing an Environmental Assessment. 601.16 Finding of No Significant Impact. 601.17 Supplemental Environmental Assessments. Subpart F—Environmental Impact Statements 601.18 Requirement for and timing of an Environmental Impact Statement. 601.19 Context, intensity, and significance of impacts. 601.20 Streamlining Environmental Impact Statements. 601.21 Programmatic Environmental Impact Statements and tiering. 601.22 Contents of an Environmental Impact Statement. 601.23 The Environmental Impact Statement process. 601.24 Final Environmental Impact Statement. 601.25 Record of Decision. 601.26 Supplemental Environmental Impact Statement. 601.27 Legislative Environmental Impact Statement. Subpart G—Dispute Resolution 601.28 Dispute resolution. 601.29 [Reserved] Authority:

    40 CFR 1507.3.

    Subpart A—General
    § 601.1 Purpose.

    This part establishes rules that supplement the Council on Environmental Quality's (CEQ) National Environmental Policy Act (NEPA) regulations that the National Capital Planning Commission (NCPC or Commission) and its applicants shall follow to ensure:

    (a) Compliance with NEPA, as amended (42 U.S.C. 4321 et seq.) and CEQ regulations for implementing the procedural provisions of NEPA (40 CFR parts 1501 through 1508).

    (b) Compliance with other laws, regulations, and Executive Orders identified by NCPC as applicable to a particular application.

    § 601.2 Policies.

    Consistent with 40 CFR 1500.1 and 1500.2, it shall be the policy of the NCPC to:

    (a) Comply with the procedures and policies of NEPA and other related laws, regulations, and orders applicable to Commission actions.

    (b) Provide applicants sufficient guidance to ensure plans and projects comply with the rules of this part and other laws, regulations, and orders applicable to Commission actions.

    (c) Integrate NEPA into its decision-making process at the earliest possible stage.

    (d) Integrate the requirements of NEPA and other planning and environmental reviews required by law including, without limitation, the National Historic Preservation Act, 54 U.S.C. 306108 (NHPA), to ensure all such procedures run concurrently.

    (e) Use the NEPA process to identify and assess the reasonable alternatives to proposed actions that will avoid or minimize adverse effects on the quality of the human environment in the National Capital Region.

    (f) Use all practicable means to protect, restore, and enhance the quality of the human environment including built and socioeconomic environments and historic properties within the National Capital Region.

    (g) Streamline the NEPA process and Environmental Impact Statements (EIS) to the maximum extent possible.

    (h) Use the NEPA process to foster meaningful public involvement in NCPC decisions.

    § 601.3 Definitions.

    For purposes of this part, the following definitions shall apply:

    Administrative Record means a compilation of all materials (written and electronic) that were before the agency at the time it made its final decision. An Administrative Record documents an agency's decision-making process and the basis for the decision.

    Categorical Exclusion or CATEX means, as defined by 40 CFR 1508.4, a category of actions which do not individually or cumulatively have a significant effect on the human environment and which have been found to have no such effect in procedures adopted by a federal agency (NCPC) in implementation of CEQ's regulations and for which, therefore, neither an Environmental Assessment (EA) nor an EIS is required.

    Central Area means the geographic area in the District of Columbia comprised of the Shaw School and Downtown Urban Renewal Areas or such other area as the District of Columbia and NCPC shall subsequently jointly determine.

    Chairman means the Chairman of the National Capital Planning Commission appointed by the President, pursuant to 40 U.S.C. 8711(c).

    Commemorative Works Act or CWA means the federal law codified at 40 U.S.C. 8901 et seq. that sets forth the requirements for the location and development of new memorials and monuments on land under the jurisdiction of the National Park Service (NPS) or the General Services Administration (GSA) in the District of Columbia and its environs.

    Commission means the National Capital Planning Commission created by 40 U.S.C. 8711.

    Comprehensive Plan means The Comprehensive Plan for the National Capital: Federal Elements prepared and adopted by the Commission pursuant to 40 U.S.C. 8721(a).

    Cooperating Agency means, as defined in 40 CFR 1508.5, any Federal Agency other than a Lead Agency and a Non-federal Agency that has jurisdiction by law or special expertise with respect to a proposal (or reasonable alternative) for legislation or other major action significantly affecting the quality of the human environment; a state or local agency of similar qualifications; or when the effects are on a reservation, an Indian Tribe when agreed to by the Lead Agency.

    Cumulative Impact means, as defined in 40 CFR 1508.7, the impact on the environment that results from the incremental impact of an action when added to other past, present, and reasonably foreseeable future actions regardless of what agency (federal or non-federal) or person undertakes such other actions. Cumulative impacts can result from individually minor, but collectively significant, actions taking place over a period of time.

    Emergency Circumstances means an unexpected, serious occurrence or situation requiring immediate attention to protect the lives and safety of the public and protect property and ecological resources and functions from imminent harm.

    Environmental Assessment or EA means, as defined in 40 CFR 1508.9, a concise document for which a federal agency is responsible that serves to briefly provide sufficient evidence and analysis for determining whether to prepare an EIS or FONSI; aid an agency's compliance with NEPA when no EIS is necessary; facilitate preparation of an EIS when one is necessary; and includes a brief discussion of the need for the proposal, alternatives as required by section 102(2)(E) of NEPA, the environmental impacts of the proposed action and alternatives, and a listing of agencies and persons consulted.

    Environmental Impact Statement or EIS means, as defined in 40 CFR 1508.11, a detailed written statement as required by 42 U.S.C. 4332(2)(C).

    Environs means the territory surrounding the District of Columbia included in the National Capital Region pursuant to 40 U.S.C. 8702(a)(1).

    Executive Director means the Executive Director employed by the National Capital Planning Commission pursuant to 40 U.S.C. 8711(d).

    Executive Director's Recommendation or EDR means a concise written report and recommendation prepared by NCPC staff under the direction of NCPC's Executive Director regarding a proposed action and transmitted to the Commission for its consideration.

    Extraordinary Circumstances means special circumstances that when present may negate an agency's ability to categorically exclude a project and may require an agency to undertake further NEPA review.

    Federal Agency means the executive agencies of the federal government as defined in 5 U.S.C. 105.

    Finding of No Significant Impact or FONSI means, as defined at 40 CFR 1508.13, a document prepared by NCPC or a Federal Agency applicant that briefly presents the reasons why an action, not otherwise excluded (40 CFR 1508.4), will not have a significant effect on the human environment and for which an EIS will not be prepared. It shall include the EA or a summary of it and shall note any other EAs or EISs related to it (40 CFR 1501.7(a)(5)). If the EA is included in the FONSI, the FONSI need not repeat any of the discussion in the EA but may be incorporated by reference.

    Lead Agency means, as defined in 40 CFR 1508.16, the agency or agencies preparing or having primary responsibility for preparing an EA or an EIS.

    Memorandum of Understanding or MOU means for purposes of implementing NEPA, a written agreement entered into between a Lead, Co-lead and a Cooperating Agency to facilitate implementation of NEPA and preparation of the requisite environmental documentation. A MOU can be written at a programmatic level to apply to all projects involving NCPC and a Federal or Non-Federal Agency applicant or on a project-by-project basis. A MOU as defined here shall be in addition to and not preclude MOUs prepared by NCPC and Federal agencies for other purposes.

    Mitigation means, as defined in 40 CFR 1508.20, avoiding an impact altogether by not taking a certain action or parts of an action; minimizing impacts by limiting the degree or magnitude of the action and its implementation; rectifying the impact by repairing, rehabilitating, or restoring the affected environment; reducing or eliminating the impact over time by preservation and maintenance operations during the life of the action; and compensating for the impact by replacing or providing substitute resources or environments.

    Monumental Core means the general area encompassed by the Capitol grounds, the Mall, the Washington Monument grounds, the White House grounds, the Ellipse, West Potomac Park, East Potomac Park, the Southwest Federal Center, the Federal Triangle area, President's Park, the Northwest Rectangle, Arlington Cemetery and the Pentagon area, and Joint Base Myer-Henderson Hall.

    National Capital Planning Act means the July 1952 legislative enactment, codified at 40 U.S.C. 8701 et seq., that created the present day National Capital Planning Commission and conferred authority upon it to serve as the planning and zoning authority for the federal government.

    National Capital Region means, as defined in 40 U.S.C. 8702(2), the District of Columbia; Montgomery and Prince Georges Counties in Maryland; Arlington, Fairfax, Loudon, and Prince William Counties in Virginia; and all cities in Maryland or Virginia in the geographic area bounded by the outer boundaries of the combined area of the counties listed.

    NEPA Document or Document means a Categorical Exclusion determination, an EA, or an EIS.

    Non-federal Agency means those applicants outside the definition of Federal Agency that prepare plans for or undertake projects on federal land and include, without limitation, the Smithsonian Institution, the John F. Kennedy Center for the Performing Arts, the National Gallery of Art, the United States Institute of Peace, the Government of the District of Columbia, the Maryland National Capital Parks and Planning Commission; and private parties undertaking development on federal land.

    Notice of Availability or NOA means a public notice or other means of public communication that announces the availability of an EA or an EIS for public review.

    Notice of Intent or NOI means, as defined in 40 CFR 1508.22, a notice published in the Federal Register that an EIS will be prepared and considered. The notice shall briefly describe the proposed action and possible alternatives; describe the agency's proposed Public Scoping process including whether, when, and where any Public Scoping meeting will be held; and state the name and address of a person within the agency who can answer questions about the proposed action and the EIS. For purposes of NCPC implementation of NEPA, NCPC may determine, at its sole discretion, to publish an NOI that an EA will be prepared and considered.

    Programmatic NEPA Review means a broad or high level NEPA review that assesses the environmental impacts of proposed policies, plans or programs, or projects for which subsequent project or site-specific NEPA analysis will be conducted. A Programmatic NEPA Review utilizes a tiering approach.

    Record of Decision or ROD means a concise public record of an agency's decision in cases requiring an EIS that is prepared in accordance with 40 CFR 1505.2.

    Scope means, as defined in 40 U.S.C. 1508.25, the range of actions (connected, cumulative and similar); alternatives (no action, other reasonable courses of action; and mitigation measures not included in the proposed action); and impacts (direct, indirect and cumulative) considered in an EIS or an EA. The process of defining and determining the scope of issues to be addressed in an EIS or EA with public involvement shall be referred to as Public Scoping. Internal scoping activities shall be referred to by the word scoping without capitalization.

    Submission Guidelines means the formally-adopted document which describes the application process and application requirements for projects requiring review by the Commission.

    Tiering means, as defined in 40 CFR 1508.28, an approach where Federal Agency applicants, NCPC on behalf of Non-federal Agency applicants, or NCPC for its own projects initially consider the broad, general impacts of a proposed program, plan, policy, or large scale project—or at the early stage of a phased proposal—and then conduct subsequent narrower, decision focused reviews.

    Subpart B—Lead and Cooperating Agencies
    § 601.4 Designation of Lead Agency.

    (a) A Federal Agency applicant shall serve as the Lead Agency and prepare an EA or an EIS for:

    (1) An application that requires Commission approval; and

    (2) An application submitted for action on a master plan that includes future projects that require Commission approval; provided that:

    (i) The applicant intends to submit individual projects covered by the master plan to the Commission within five years of the date of Commission action on the master plan; and

    (ii) The applicant intends to use the master plan EA or EIS to satisfy its NEPA obligation for specific projects referenced in the master plan.

    (b) At the sole discretion of the Executive Director, and unless determined otherwise, NCPC shall serve as Lead Agency and prepare and EA or and EIS for:

    (1) An application submitted by a Non-federal Agency that requires Commission approval;

    (2) An application submitted by a Non-federal Agency for action on a master plan that includes future projects that require Commission approval; provided that:

    (i) The Non-federal Agency applicant intends to submit individual projects covered by the master plan to the Commission within five years of the date of Commission action on the master plan; and

    (ii) The Non-federal Agency applicant intends to use the master plan EA or EIS to satisfy its NEPA obligation for a specific project referenced in the master plan; and

    (3) An application for approval of land acquisitions undertaken pursuant to 40 U.S.C. 8731-8732.

    § 601.5 Lead Agency obligations.

    (a) The obligations of a Federal Agency applicant designated as the Lead Agency in accordance with § 601.4(a) shall include, without limitation, the following:

    (1) Act as Lead Agency as defined in 40 CFR 1501.5 for the NEPA process.

    (2) Designate NCPC to participate as a Co-lead or Cooperating Agency and consult with Commission staff as early as possible in the planning process to obtain guidance with respect to the goals, objectives, standards, purpose, need, and alternatives for the NEPA analysis.

    (3) Invite affected federal, state, regional and local agencies, and other potentially interested parties to participate as a Cooperating Agency in the NEPA process.

    (4) Consult with the affected agencies and entities as early as possible in the planning process to obtain guidance on the goals, objectives, standards, purpose, need, and alternatives for the NEPA analysis.

    (5) Work with Cooperating Agencies and stakeholders, e.g., those with a direct stake in the outcome, in the following manner:

    (i) Keep them informed on the project schedule and substantive matters; and

    (ii) Allow them an opportunity to review and comment within reasonable time frames on, without limitation, Public Scoping notices; technical reports; public materials (including responses to comments received from the public); potential mitigation measures; the draft EA or EIS; and the draft FONSI or ROD.

    (6) Prepare the appropriate NEPA Document consistent with the applicant's NEPA regulations, the requirements of this part, and CEQ regulations.

    (7) Determine in its NEPA Document whether an action will have an adverse environmental impact or would limit the choice of reasonable alternatives under 40 CFR 1505.1(e) and take appropriate action to ensure that the objectives and procedures of NEPA are achieved.

    (8) Prepare, make available for public review, and issue a FONSI or ROD.

    (9) Ensure that the draft and final EIS comply with the requirements of 40 CFR 1506.5(c) and include a disclosure statement executed by any contractor (or subcontractor) under contract to prepare the EIS document and that the disclosure appears as an appendix to the EIS.

    (10) Compile, maintain, and produce the Administrative Record.

    (11) Provide periodic reports on implementation of Mitigation measures to NCPC and other Cooperating Parties consistent with a schedule established in the NEPA Document.

    (12) Re-evaluate and update NEPA documents that are five or more years old as measured from the time of their adoption when either or both of the following criteria apply:

    (i) There are substantial changes to the proposed action that are relevant to environmental concerns; and

    (ii) There are significant new circumstances or information that are relevant to environmental concerns and have a bearing on the proposed action or its impacts.

    (13) Consult with NCPC on the outcome of the re-evaluation of its NEPA Document; provided that the NCPC reserves the right to make the final determination as to whether a Lead Agency's NEPA document requires updating.

    (b) When NCPC serves as Lead Agency in accordance with § 601.4(b), in addition to the obligations listed in paragraphs (a)(1) through (12) of this section, NCPC may:

    (1) Ask applicants, at its sole discretion, to enter into a MOU. The MOU may be prepared as a programmatic MOU that addresses a uniform approach for the treatment of all applications from a particular applicant or address a specific application. The request to enter into a project specific MOU shall be made after a determination is made as to the inability to utilize a CATEX. A MOU shall specify, without limitation, project information; roles and responsibilities; project timelines and schedules; principal contacts and contact information; and a mechanism for resolving disputes.

    (2) Request assistance from a Non-federal Agency applicant with the preparation of a NEPA Document. If requested by NCPC, the assistance shall include the provision of funding for a contractor retained by NCPC to prepare the requisite NEPA document. When Non-federal Agency financial assistance is requested, NCPC shall invite the Non-federal Agency applicant to participate in the procurement process to select the contractor.

    (3) Require Non-federal Agency applicants to submit periodic reports on implementation of Mitigation measures to NCPC consistent with a schedule established in the NEPA Document.

    § 601.6 Resolving disputes over Lead Agency status.

    (a) In the event of a dispute with a Federal Agency applicant or a Non-federal Agency applicant over Lead Agency status, the parties shall use their best efforts to cooperatively resolve disputes at the working levels of their respective agencies and, if necessary, by escalating such disputes within their respective agencies.

    (b) If internal resolution at higher agency levels proves unsuccessful, at NCPC's sole discretion, one of the following actions shall be pursued: the parties shall request CEQ's determination on which agency shall serve as Lead, NCPC shall prepare its own NEPA Document, or NCPC shall decline to take action on the underlying application.

    (c) Disputes other than those relating to the designation of Lead Agency status or Cooperating Status as described in § 601.7(b), shall be governed by the requirements of subpart G of this part.

    § 601.7 Cooperating Agencies.

    (a) When a Federal Agency applicant serves as the Lead Agency, NCPC shall act as a Cooperating Agency. As a Cooperating Agency, NCPC shall, without limitation, undertake the following:

    (1) Act as a Cooperating Agency as described in 40 CFR 1501.6.

    (2) Assist in the preparation of and sign a MOU if requested by the Lead Agency. At the lead agency's discretion, the MOU may be prepared as a programmatic MOU that addresses a uniform approach for the treatment of all applications where NCPC serves as a cooperating agency or address a specific application. The request to enter into a project specific MOU shall be made after a determination is made as to the inability to utilize a CATEX.

    (3) Participate in the NEPA process by providing comprehensive, timely reviews of and comments on key NEPA materials including, without limitation, Public Scoping notices; technical reports; documents (including responses to comments received from the public); the draft and final EA or EIS; and the FONSI or ROD.

    (4) Supply available data, assessments, and other information that may be helpful in the preparation of the NEPA Document or the Administrative Record in a timely manner.

    (5) Make an independent evaluation of the Federal Agency applicant's NEPA Document and take responsibility for the scope and contents of the EIS or EA when it is sufficient as required by 40 CFR 1506.5.

    (6) Prepare and sign a ROD or FONSI or, if NCPC concurs with the contents of the document, co-sign the Federal Agency's ROD or FONSI.

    (7) Provide documentation as requested and as needed by the Lead Agency for the Administrative Record.

    (b) In the event a Federal Agency applicant fails to allow NCPC to participate in a meaningful manner as a Cooperating Agency, the parties shall agree to use their best efforts to cooperatively resolve the issue at the working levels of their respective agencies, and, if necessary, by escalating the issue within their respective agencies. If internal resolution at higher agency levels is unsuccessful, NCPC at its sole discretion shall either require the parties to seek mediation, prepare its own NEPA Document either as a stand-alone document or a supplement to the Federal Agency applicant's NEPA Document, or take no action on the underlying application.

    (c) When NCPC serves as Lead Agency on behalf of Non-federal Agency applicant, the Non-federal Agency applicant shall serve as a Cooperating Agency and comply with the requirements of paragraphs (a)(1) through (4) and (7) of this section. Non-federal Agency applicants shall extend all assistance necessary to facilitate NCPC's compliance with NEPA including the provision of funding for consultant services if requested.

    Subpart C—NEPA Submission Schedules
    § 601.8 NEPA submission schedule for applications governed by the National Capital Planning Act.

    (a) Federal Agency and Non-federal Agency applicants shall comply with NEPA for the following types of projects:

    (1) Projects requiring Commission approval; and

    (2) Master plans requiring Commission action with future projects requiring subsequent Commission approval; provided that:

    (i) The applicant intends to submit individual projects depicted in the master plan to the Commission within five years of the date of Commission action on the master plan; and

    (ii) The applicant intends to use the master plan EA or EIS to satisfy its NEPA obligation for specific projects referenced in the master plan.

    (b) When Federal Agency and Non-federal Agency applicants submit projects of the type described in paragraph (a) of this section, the applicant shall submit the NEPA documentation timed to coincide with the Commission's review stages as set forth in paragraphs (c) through (f) of this section.

    (c) Concept review. If NCPC's Submission Guidelines require review at the concept stage, the NEPA Public Scoping process shall have been initiated before the applicant submits an application for concept review. Available NEPA documentation, including a CATEX determination, shall be included in the application to facilitate effective Commission concept review.

    (d) Preliminary review. An applicant shall have issued or published its Draft NEPA Document before the applicant submits an application for preliminary review. The NEPA information shall be provided to the Commission to facilitate the Commission's preliminary review and the provision of meaningful Commission comments and direction.

    (e) Final review. The responsible Lead Agency shall complete and sign the final determination ROD or a FONSI) resulting from the NEPA Document before the applicant submits an application for final review. If NCPC is not the Lead Agency for NEPA, it shall at the time of final review undertake the steps outlined in § 601.7(a)(5) and (6). If applicable, the Section 106 consultation process required by the NHPA shall also be complete at this stage.

    (f) Deviations from the submission schedule for emergency circumstances. (1) This paragraph (f) applies when the following three conditions exist:

    (i) NCPC is the Lead Agency;

    (ii) Emergency Circumstances exist; and

    (iii) An Extraordinary Circumstance as set forth in § 601.11 is present that precludes use of a CATEX.

    (2) When the three conditions described in paragraphs (f)(1)(i) through (iii) of this section exist, the Executive Director shall make a determination as to whether the CATEX can or cannot be applied as soon as practicable. If the Executive Director determines a CATEX may not be applied, he/she shall take one of the steps indicated in paragraph (f)(2)(i) or (ii) of this section.

    (i) When Emergency Circumstances render it necessary to take an action that requires an EA before the EA can be competed, the Executive Director shall develop alternative arrangements focused on minimizing environmental impacts of the proposed action. These steps shall follow those normally undertaken for an EA, to include, to the maximum extent practicable, preparation of a document with appropriate content, interagency coordination, and public notification and involvement. The Commission shall grant approval for the alternative arrangement. At the earliest opportunity, the Executive Director shall advise CEQ of the alternative arrangement.

    (ii) Where Emergency Circumstances make it necessary for the Commission to take an action with significant environmental impacts without observing the rules of this part and CEQ's regulations, the Executive Director shall advise the Commission of the situation. Thereafter, as soon as practicable, the Executive director shall consult with CEQ regarding alternative arrangements for complying with NEPA.

    § 601.9 NEPA submission schedule for applications governed by the Commemorative Works Act.

    (a) When, pursuant to the Commemorative Works Act, NPS or GSA submits an application to the Commission for approval of a site and design for a commemorative work, the applicant shall be required to comply with NEPA and submit the NEPA documentation timed to coincide with the Commission's review stages as set forth in paragraphs (b) through (e) of this section.

    (b) Concept site review. (1) If NCPC's Submission Guidelines require concept site review, the NEPA Scoping Process shall have been initiated before NPS or GSA submits an application to the Commission for concept site review. Available NEPA documentation for all concept sites shall be included in the application to facilitate effective Commission concept review.

    (2) The Commission shall provide comments to NPS or GSA on the multiple sites to assist the applicant in selecting a preferred site.

    (c) Concept design review for preferred sites. (1) If NCPC's Submission Guidelines require concept design review, the NEPA Public Scoping Process shall have been initiated before NPS or GSA submits an application to the Commission for a concept design review. Available NEPA documentation shall be included in the application to facilitate effective Commission concept review.

    (2) The Commission shall provide comments to NPS or GSA on the preferred site(s) and the concept designs for each site to facilitate selection of a preferred site and refinement of the memorial design for that site. The Commission may impose conditions on or establish guidelines for the applicant to follow in preparing its preliminary and final commemorative work design to avoid, minimize or mitigate environmental impacts including adverse effects on historic properties.

    (d) Preliminary site and design review. (1) NPS or GSA shall have issued or published its Draft NEPA Document for the site selection process and the memorial design and shall have initiated the requisite public comment period before the applicant submits an application for preliminary site and design approval. The NEPA information shall be provided to the Commission to facilitate the Commission's preliminary review and the provision of meaningful Commission comments and directions.

    (2) The Commission shall take an appropriate action on the preferred site and preliminary design and provide comments to the applicant on the preliminary design to assist the applicant's preparation of a final design.

    (e) Final site and design review. The final environmental determination (ROD or FONSI) applicable to both the site selection and memorial design shall be completed and signed by NPS or GSA before the applicant submits an application for final review. NCPC shall have either co-signed the NPS or GSA ROD or FONSI or prepared and signed its own independent document. If applicable, the Section 106 consultation process required by the NHPA shall also be complete at this stage.

    Subpart D—Initiating the NEPA Process
    § 601.10 Characteristics of Commission actions eligible for a Categorical Exclusion.

    (a) A categorical exclusion is a type of action that does not individually or cumulatively have a significant effect on the human environment and which has been found to have no such effect by NCPC.

    (b) Actions that generally qualify for application of a categorical exclusion and do not require either an EA or an EIS exhibit the following characteristics:

    (1) Minimal or no effect on the human environment;

    (2) No significant change to existing environmental conditions;

    (3) No significant cumulative environmental impacts; and

    (4) Similarity to actions previously assessed in an EA concluding in a FONSI and monitored to confirm the FONSI.

    § 601.11 Extraordinary Circumstances.

    (a) Before applying a CATEX listed in § 601.12, the Executive Director shall consider whether a project or plan requires additional environmental review or analysis due to the existence of Extraordinary Circumstances. If any of the Extraordinary Circumstances listed in paragraphs (b)(1) through (10) of this section are present, the Executive Director shall direct staff to undertake a preliminary analysis to determine if the presence of the Extraordinary Circumstances negates the application of a CATEX. If the preliminary analysis determines application of a CATEX is not appropriate, the Executive Director shall see that the proper NEPA Document is prepared and made available to the Commission before the Commission takes action on the matter. If the Extraordinary Circumstance does not negate application of a CATEX, the appropriate CATEX shall be applied and its application documented for the record.

    (b) Extraordinary Circumstances that may negate the application of a CATEX include:

    (1) A reasonable likelihood of significant impact on public health or safety.

    (2) A reasonable likelihood of significant environmental impacts on sensitive resources unless the impact has been resolved through another processes to include, without limitation, Section 106 of the NHPA. Environmentally sensitive resources include without limitation:

    (i) Proposed federally listed, threatened or endangered species or their designated critical habitats.

    (ii) Properties listed or eligible for listing on the National Register of Historic Places.

    (iii) Areas having special designation or recognition based on federal law or an Executive Order, to include without limitation, National Historic Landmarks, floodplains, wetlands, and National Parks.

    (iv) Cultural, scientific or historic resources.

    (3) A reasonable likelihood of effects on the environment that are risky, highly uncertain, or unique.

    (4) A reasonable likelihood of violating an Executive Order, or federal, state or local law or requirements imposed for the protection of the environment.

    (5) A reasonable likelihood of causing a significant increase in surface transportation congestion, disruption of mass transit, and interference with pedestrian and bicycle movements.

    (6) A reasonable likelihood of significantly degrading air quality or violating air quality control standards under the Clean Air Act (42 U.S.C. 7401-7671q).

    (7) A reasonable likelihood of significantly impacting water quality, public water supply systems, or state or local water quality control standards under the Clean Water Act (33 U.S.C. 1251 et seq.) and the Safe Drinking Act (42 U.S.C. 300f).

    (8) A reasonable likelihood of a disproportional high and adverse effect on low income and minority populations.

    (9) A reasonable likelihood of degrading existing unsatisfactory environmental conditions.

    (10) A reasonable likelihood of establishing a precedent for future action or making a decision in principle about future actions with potentially significant environmental effects.

    (c) The Executive Director shall include in his EDR, or the documentation of a Delegated Action, his/her decision to apply or not apply a Categorical Exclusion because of Extraordinary Circumstances and the rationale for this decision.

    § 601.12 National Capital Planning Commission Categorical Exclusions.

    Commission actions that may be categorically excluded and normally do not require either an EA or an EIS include:

    (a) Approval of the installation or restoration of onsite primary or secondary electrical distribution systems including minor solar panel arrays.

    (b) Approval of the installation or restoration of minor site elements, such as but not limited to identification signs, sidewalks, patios, fences, curbs, retaining walls, landscaping, and trail or stream improvements. Additional features include water distribution lines and sewer lines which involve work that is essentially replacement in kind.

    (c) Approval of the installation or restoration of minor building elements, such as, but not limited to windows, doors, roofs, building signs, and rooftop equipment and green roofs.

    (d) Adoption of a Federal Element of the Comprehensive Plan or amendment thereto or broad based policy or feasibility plans prepared and adopted by the Commission in response to the Comprehensive Plan.

    (e) Approval of an action proposed by a District of Columbia agency which the agency has determined is not a major action significantly affecting the quality of the human environment or is designated an exclusion in accordance with the requirements and procedures of DC Code. 8-109.06 and any regulations adopted to implement the referenced statutory provision.

    (f) Approval of changes to highway plans for portions of the District of Columbia prepared by the Mayor, pursuant to D.C Code. 9-103.02, subject to documentation by the District that such plans involve no major traffic volume increase, have minimal or no effect on the environment, result in no significant change to existing environmental conditions, and impose no significant cumulative environmental impact associated with the action associated with the action as demonstrated in accordance with the requirements and procedures of DC Code. 8-109.01 et seq. and any regulations adopted to implement the referenced statutory provisions.

    (g) Approval of the sale by the Secretary of the Interior of parcels of real estate held by the United States in the District of Columbia under the jurisdiction of NPS that are no longer needed for public purposes pursuant to 40 U.S.C. 8735. Such an action shall be accompanied by a NPS NEPA determination that demonstrates minimal or no effect on the environment, no significant change to existing environmental conditions, and no significant cumulative environmental impact associated with the action.

    (h) Approval of the exchange of parcels of District-owned land, or part thereof, for an abutting lot or parcel of land, or part thereof pursuant to DC Code. 10-901, when such plans involve minimal or no effect on the environment, no significant change to existing environmental conditions, and no significant cumulative environmental impact associated with the action as demonstrated in accordance with the requirements and procedures of DC Code 8-109.01 et seq. and any regulations adopted to implement the referenced statutory provisions.

    (i) Approval of the installation of communication antennae on federal buildings and co-location of communication antennae on federal property consistent with GSA Bulletin FMR D-242, Placement of Commercial Antennas on Federal Property.

    (j) Approval of new construction, building expansion, or improvements to existing facilities, when:

    (1) The new structure and proposed use are in compliance with local planning and zoning and any applicable District of Columbia, state, or federal requirements.

    (2) The site and the scale of construction are consistent with those of existing adjacent or nearby buildings.

    (3) The proposed use will not substantially increase the number of motor vehicles at the Facility.

    (4) There is no evidence of community controversy or other environmental issues.

    (k) Approval of transfers of jurisdiction pursuant to 40 U.S.C. 8421(a) that will not lead to anticipated changes in the use of land and that have no potential for environmental impact.

    (l) Approval of a minor modification to a General Development Plan applicable to lands acquired pursuant to the Capper-Cramton Act, 46 Stat. 482 (1930), as amended, when no or minimal environmental impacts are anticipated.

    (m) Approval of an action proposed by a Federal Agency applicant when such applicant has determined a categorical exclusion set forth in its NEPA-implementing procedures applies to the proposed action; provided the Executive Director shall review the determination as to both the applicability of the exclusion and the absence of any extraordinary circumstances.

    (n) Reorganization of NCPC.

    (o) Personnel actions, including, but not limited to, investigations; performance reviews; award of personal service contracts, promotions, and awards; reductions in force, reassignments and relocations; and employee supervision and training.

    (p) Legal activities including, but not limited to, legal advice and opinions; litigation or other methods of dispute resolution; and procurement of outside legal services.

    (q) Procurement of goods and services, transactions, and other types of activities related to the routine and continuing administration, management, maintenance and operations of the Commission or its facilities.

    (r) Adoption and issuance of rules, directives, official policies, guidelines, and publications or recommendations of an educational, financial, informational, legal, technical or procedural nature.

    Subpart E—Environmental Assessments
    § 601.13 Characteristics of Commission actions eligible for an Environmental Assessment.

    (a) An EA is a concise document with sufficient information and analysis to enable the Executive Director to determine whether to issue a FONSI or prepare an EIS.

    (b) Commission actions that generally require an EA exhibit the following characteristics:

    (1) Minor but likely insignificant degradation of environmental quality;

    (2) Minor but likely insignificant cumulative impact on environmental quality; and

    (3) Minor but likely insignificant impact on protected resources.

    § 601.14 Commission actions generally eligible for an Environmental Assessment.

    Commission actions that typically require preparation of an EA include without limitation:

    (a) Approval of final plans for Federal public buildings in the District of Columbia, and the provisions for open space in and around the same, pursuant to 40 U.S.C. 8722(d) and DC Code 2-1004(c), unless such plans meet the criteria of § 601.12(j).

    (b) Approval of final plans for District of Columbia public buildings and the open space around them within the Central Area pursuant to 40 U.S.C. 8722(e) and DC Code 2-1004(d) unless such plans meet the criteria of § 601.12(e) or (j).

    (c) Recommendations to a Federal or District of Columbia agency on any master plan or master plan modification submitted to the Commission that include proposed future projects that require Commission approval pursuant to 40 U.S.C. 8722(d)-(e) and DC Code 2-1004(c)-(d) within a five-year timeframe.

    (d) Approval of a final site and design for a commemorative work authorized under the Commemorative Works Act pursuant to 40 U.S.C. 8905.

    (e) Approval of transfers of jurisdiction over properties within the District of Columbia owned by the United States or the District among or between federal and District authorities, pursuant to 40 U.S.C. 8124(a), unless such transfers met the criteria of § 601.12(k).

    § 601.15 Process for preparing an Environmental Assessment.

    An EA prepared by NCPC as the Lead Agency for a project requiring Commission approval shall comply with the following requirements:

    (a) The EA shall include, without limitation, a brief discussion of the proposed action; the need for the proposed action; the environmental impacts of the proposed action; the environmental impacts of the alternatives considered; Mitigation measures, if necessary; and a list of agencies and persons consulted in preparation of the assessment.

    (b) The NCPC shall involve, as appropriate, applicants; Federal and District of Columbia agencies; the public; and stakeholders (those with an economic, cultural, social, or environmental “stake” in the action) in the preparation of an EA.

    (c) The NCPC, at the sole discretion of the Executive Director, may undertake Public Scoping for an action requiring an EA. The Public Scoping shall commence thirty calendar days after issuance of a public notice of NCPC's intent to prepare an EA. The notice shall include the date, time and location of the Public Scoping meeting.

    (d) The NCPC may solicit public review and comment of a Draft EA. The public comment period shall be a minimum of thirty calendar days. The public comment period shall begin when the Executive Director announces the availability of the Draft EA on the NCPC Web site (www.ncpc.gov). The NCPC, at its sole discretion, may decline to circulate a draft EA for non-controversial projects.

    § 601.16 Finding of No Significant Impact.

    (a) If NCPC is the Lead Agency and the final EA supports a FONSI, NCPC shall prepare and execute a FONSI. The FONSI shall be prepared following closure of the discretionary public comment period on a Draft EA, or if no circulation is deemed necessary, at the conclusion of the preparation of an EA. The FONSI shall briefly state the reasons why the proposed action will not have a significant effect on the environment and include the EA or a summary thereof, any Mitigation commitments, and a schedule for implementing the Mitigation commitments.

    (b) If NCPC is not the Lead Agency, it shall evaluate the adequacy of the Lead Agency's FONSI, and if determined adequate, NCPC may co-sign the Lead Agency's FONSI. Alternatively, NCPC may prepare and execute its own FONSI consistent with the requirements of paragraph (a) of this section.

    (c) A FONSI prepared by NCPC shall be available for public review seven calendar days before the Commission takes action on the underlying application.

    (d) If the Commission determines a Lead Agency's EA does not support a FONSI, either the Lead Agency shall prepare an EIS, or the Commission shall not approve or consider further the underlying application.

    § 601.17 Supplemental Environmental Assessments.

    (a) The NCPC shall prepare a supplemental EA if five or more years have elapsed since adoption of the EA and:

    (1) There are substantial changes to the proposed action that are relevant to environmental concerns; and

    (2) There are significant new circumstances or information that are relevant to environmental concerns and have a bearing on the proposed action or its impacts.

    (b) The NCPC may supplement a Draft or Final EA at any time to further the purposes of NEPA.

    (c) The NCPC shall prepare, circulate, and file a supplement to a Draft or Final EA, and adopt a FONSI in accordance with the requirements of §§ 601.15 and 601.16. If NCPC is not the Lead Agency, it shall proceed as outlined in § 601.16(b) and (c).

    Subpart F—Environmental Impact Statements
    § 601.18 Requirement for and timing of an Environmental Impact Statement.

    Prior to the Commission's approval of a major federal action significantly affecting the quality of the human environment, the Executive Director shall prepare an EIS on behalf of a Non-federal Agency applicant.

    § 601.19 Context, intensity, and significance of impacts.

    (a) As required by 40 CFR 1508.27(a) and (b), the determination of whether an EIS is required and whether impacts are significant shall be made with consideration to the context and intensity of the impacts associated with a proposed action.

    (b) The significance of an action is determined in the context of its effects on society as a whole, the National Capital Region and its environs, the particular interests affected, and the specific locality or area within which the proposed action is located. The context will vary from project to project and will be based on the type, attributes, and characteristics of a particular proposal.

    (c) The significance of an action is also determined based on the severity of impacts imposed by the proposal. Severity shall be determined based on an evaluation of a proposal in the manner outlined in 40 CFR1508.27(b)(1) through (10). The evaluation shall also be informed by the relevant policies of “The Comprehensive Plan for the National Capital: Federal Elements” and other applicable Commission plans and programs. Proposed actions that conflict with or delay achievement of the goals and objectives of Commission plans and programs are generally more likely to be found to have significant impacts than proposals that are consistent with Commission plans and programs.

    (d) Proposed actions shall also be deemed significant and require and EIS if they exhibit the following characteristics:

    (1) The proposed action results in extensive change to the Monumental Core.

    (2) The proposed action causes substantial alteration to the important historical, cultural, and natural features of the National Capital and its Environs.

    (3) The proposed action is likely to be controversial because of its impacts on the human environment.

    § 601.20 Streamlining Environmental Impact Statements.

    The NCPC as Lead Agency shall use all available techniques to minimize the length of an EIS. Such techniques include, without limitation, drafting an EIS in clear, concise language; preparing an analytic vs. encyclopedic EIS; reducing emphasis on background information; using the scoping process to emphasize significant issues and de-emphasize non-significant issues; incorporating relevant information by reference; using a programmatic EIS and tiering to eliminate duplication in subsequent EISs; and following the format guidelines of § 601.22.

    § 601.21 Programmatic Environmental Impact Statements and tiering.

    (a) The NCPC shall prepare a programmatic NEPA Document (Programmatic EA or PEA or Programmatic EIS or PEIS) to assess the impacts of proposed projects and plans when there is uncertainty regarding the timing, location and environmental impacts of subsequent implementing actions. At the time NCPC undertakes a site or project specific action within the parameters of the PEA or PEIS, NCPC shall tier its NEPA Document by summarizing information in the PEIS or PEA, as applicable, and concentrate on the issues applicable to the specific action.

    (b) A PEIS or PEA prepared by NCPC shall be governed by the CEQ regulations and the rules of this part.

    § 601.22 Contents of an Environmental Impact Statement.

    When NCPC serves as Lead Agency for an EIS, the following information shall be included in the EIS:

    (a) A cover sheet. The cover sheet shall be one-page and include a list of responsible and Cooperating Agencies; the title of the proposed action that is the subject of the EIS; the name, address, and telephone number of the NCPC point of contact; the designation as to whether the statement is draft, final, or draft or final supplement; a one paragraph abstract of the EIS; and the date by which comments must be received.

    (b) A summary. The summary shall accurately summarize the information presented in the EIS. The summary shall focus on the main conclusions, areas of controversy, and the issues to be resolved. The summary shall not exceed fifteen pages.

    (c) A table of contents. The table of contents shall allow a reader to quickly locate subject matter in the EIS—either by topic area and/or alternatives analyzed.

    (d) The purpose and need. A statement of the purpose of and need for the action briefly stating the underlying purpose and need to which the agency is responding.

    (e) The identification of alternatives including the proposed action. This section shall provide a brief description and supporting documentation for all alternatives including the proposed action; the no action alternative; all reasonable alternatives including those not within the jurisdiction of the agency; alternatives considered but eliminated and the reason for their elimination; the agency's preferred alternative, if one exists; the environmentally preferred alternative; and Mitigation measures not already included in the proposed action.

    (f) The identification of the affected environment. This section shall provide a succinct description of the environment to be affected by the proposed action and the alternatives considered. This section shall include, if applicable, other activities in the area affected by or related to the proposed action.

    (g) The identification of environmental consequences. This section shall focus on the environmental impacts of the alternatives including the proposed action, any adverse environmental effects which cannot be avoided should the proposal be implemented, the relationship between short-term uses of the environment and the maintenance and enhancement of long-term productivity, and any irreversible commitments of resources which would be involved if the proposal is implemented. The impacts shall be discussed in terms of direct, indirect and cumulative effects and their significance, as well as any appropriate means to mitigate adverse impacts. The discussion shall also include issues and impact topics considered but dismissed to reveal non-impacted resources. Resource areas and issues requiring consideration shall include those identified in the scoping process, and, without limitation, the following:

    (1) Possible conflicts between the proposed action and the land use plans, policies, or controls (local, state, or Indian tribe) for the area concerned.

    (2) Natural and biological resources including topography, hydrology, soils, flora, fauna, floodplains, wetlands, and endangered species.

    (3) Air quality.

    (4) Noise.

    (5) Water resources including wastewater treatment and storm water management.

    (6) Utilities including energy requirements and conservation.

    (7) Solid waste and hazardous waste generation/removal.

    (8) Community facilities.

    (9) Housing.

    (10) Transportation network.

    (11) Socio-cultural and economic environments.

    (12) Environmental Justice and the requirements of Executive Order 12898 (Federal Actions to Address Environmental Justice in Minority Populations).

    (13) Urban quality and design of the built environment including visual resources and aesthetics.

    (14) Historic and cultural resources to include documentation of the results of the Section 106 Consultation process.

    (15) Public health and safety.

    (h) A list of preparers. This list shall include all pertinent organizations, agencies, individuals, and government representatives primarily responsible for the preparation of the EIS and their qualifications.

    (i) An index. The index shall be structured to reasonably assist the reader of the Draft or Final EIS in identifying and locating major topic areas or elements of the EIS information. The level of detail of the index shall provide sufficient focus on areas of interest to any reader not just the most important topics.

    (j) An appendix. The appendix shall consist of material prepared in connection with an EIS (as distinct from material which is incorporated by reference) and material which substantiates any analysis fundamental to the EIS. The material in the appendix shall be analytical and relevant to the decision to be made. The appendix shall be circulated with the EIS or be readily available upon request.

    § 601.23 The Environmental Impact Statement process.

    (a) The NCPC shall involve the applicant, Federal and District of Columbia agencies, members of the public and stakeholders in the preparation of an EIS. Public participation shall be required as part of Public Scoping process and review of the Draft EIS. The NCPC shall also consult with agencies having jurisdiction by law or expertise. Agencies with “jurisdiction by law” are those with ultimate jurisdiction over a project and whose assistance may be required on certain issues and those with other kinds of regulatory or advisory authority with respect to the action or its effects on particular environmental resources.

    (b) To determine the scope of an EIS through a Public Scoping process, NCPC shall proceed as follows:

    (1) Disseminate a NOI in accordance with 40 CFR 1506.6.

    (2) Publish a NOI in the Federal Register which shall begin the Public Scoping process.

    (3) Include the date, time, and location of a Public Scoping meeting in the NOI. The public meeting shall be announced at least thirty calendar days in advance of its scheduled date.

    (4) Hold Public Scoping meeting(s) in facilities that are accessible to the disabled; include Translators requested in advance; include signers or interpreters for the hearing impaired if requested in advance; and allow special arrangements for consultation with affected Indian tribes or other Native American groups who have environmental concerns that cannot be shared in a public forum.

    (5) Consider all comments received during the announced comment period regarding the analysis of alternatives, the affected environment, and identification of potential impacts.

    (6) Apply the provisions of this section to a Supplemental EIS if the Executive Director of NCPC, in his/her sole discretion, determines a Public Scoping process is required for a Supplemental EIS.

    (c) A Draft EIS shall be available to the public for their review and comment, for a period of not less than forty-five calendar days. The public comment period shall begin when EPA publishes a NOA of the document in the Federal Register. The NCPC shall hold at least one public meeting during the public comment period on a Draft EIS. The public meeting shall be announced at least thirty calendar days in advance of its scheduled occurrence. The announcement shall identify the subject of the Draft EIS and include the public meeting date, time, and location.

    § 601.24 Final Environmental Impact Statement.

    (a) The NCPC shall prepare a Final EIS following the public comment period and the public meeting(s) on the Draft EIS. The Final EIS shall respond to oral and written comments received during the Draft EIS public comment period.

    (b) The Commission shall take final action on an application following a thirty-day Commission-sponsored review period of the Final EIS. The thirty-day period shall start when the EPA publishes a NOA for the Final EIS in the Federal Register.

    § 601.25 Record of Decision.

    (a) If NCPC as the Lead Agency decides to recommend approval of a proposed action covered by an EIS, it shall prepare and sign a ROD stating the Commission's decision and any conservation or Mitigation measures required by the Commission. The ROD shall include among others:

    (1) A statement of the decision.

    (2) The identification of alternatives considered in reaching a decision specifying the alternatives that were considered to be environmentally preferable. The ROD shall discuss preferences among alternatives based on relevant factors including economic and technical planning considerations and the Commission's statutory mission. The ROD s shall identify those factors balanced to reach a decision and the influence of various factors on the decision.

    (3) A statement as to whether all practicable means to avoid or minimize environmental harm from the alternative selected has been adopted, and if not, why they are not.

    (4) A monitoring and enforcement program that summarizes Mitigation measures.

    (5) Date of issuance.

    (6) Signature of the Chairman.

    (b) The contents of the ROD proposed for Commission adoption shall be summarized in the EDR and a full version of the document shall be included as an Appendix to the EDR. The proposed ROD, independently of the EDR, shall be made available to the public for review fourteen calendar days prior to the Commission's consideration of the proposed action for which the EIS was prepared.

    (c) The Commission shall arrive at its decision about the proposed action and it's environmental effects in a public meeting of record as identified by the Commission's monthly agenda.

    (d) If NCPC is not the Lead Agency, it shall either co-sign the Lead Agency's ROD if it agrees with its contents and conclusions or it shall prepare and sign its own ROD consistent with the requirements of paragraph (a) of this section.

    (e) If the Commission determines a Lead Agency's EIS fails to support a ROD, the Lead Agency shall revise its EIS, or, alternatively, the Commission shall not approve or give any further consideration to the underlying application.

    § 601.26 Supplemental Environmental Impact Statement.

    (a) The NCPC shall prepare a supplemental EIS if five or more years has elapsed since adoption of the EIS and:

    (1) There are substantial changes to the proposed action that are relevant to environmental concerns; and

    (2) There are significant new circumstances or information that are relevant to environmental concerns and have a bearing on the proposed action or its impacts.

    (b) The NCPC may supplement a Draft or Final EIS at any time, to further the purposes of NEPA.

    (c) The NCPC shall prepare, circulate, and file a supplement to a Draft or Final EIS in accordance with the requirements of §§ 601.22 through 601.24 of this part except that Public Scoping is optional for a supplemental EIS.

    (d) The NCPC shall prepare a ROD for a Supplemental EIS. The ROD's contents, the procedure for public review, and the manner in which it shall be adopted shall be as set forth in § 601.25.

    § 601.27 Legislative Environmental Impact Statement.

    (a) Consistent with 40 CFR 1506.8, the Executive Director shall prepare an EIS for draft legislation initiated by NCPC for submission to Congress. The EIS for the proposed legislation shall be included as part of the formal transmittal of NCPC's legislative proposal to Congress.

    (b) The requirements of this section shall not apply to legislation Congress directs NCPC to prepare.

    Subpart G—Dispute Resolution
    § 601.28 Dispute resolution.

    Any disputes arising under this part, shall be resolved, unless otherwise stated, by the parties through interagency, good faith negotiations starting at the working levels of each agency, and if necessary, by escalating such disputes within the respective agencies. If resolution at higher levels is unsuccessful, the parties shall resort to mediation.

    § 601.29 [Reserved]
    Dated: May 23, 2017. Anne R. Schuyler, General Counsel.
    [FR Doc. 2017-10940 Filed 5-26-17; 8:45 am] BILLING CODE P
    DEPARTMENT OF ENERGY 2 CFR Chapter IX 5 CFR Chapter XXIII 10 CFR Chapters II, III and X 41 CFR Chapter 109 48 CFR Chapter 9 Reducing Regulation and Controlling Regulatory Costs AGENCY:

    Office of the Secretary, Department of Energy.

    ACTION:

    Request for information (RFI).

    SUMMARY:

    As part of its implementation of Executive Order 13771, “Reducing Regulation and Controlling Regulatory Costs,” issued by the President on January 30, 2017, the Department of Energy (DOE) is seeking comments and information from interested parties to assist DOE in identifying existing regulations, paperwork requirements and other regulatory obligations that can be modified or repealed, consistent with law, to achieve meaningful burden reduction while continuing to achieve the Department's statutory obligations.

    DATES:

    Written comments and information are requested on or before July 14, 2017.

    ADDRESSES:

    Interested persons are encouraged to submit comments, identified by “Regulatory Burden Reduction RFI,” by any of the following methods:

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

    Email: [email protected] Include “Regulatory Burden RFI” in the subject line of the message.

    Mail: U.S. Department of Energy, Office of the General Counsel, 1000 Independence Avenue SW., Room 6A245, Washington, DC 20585.

    FOR FURTHER INFORMATION CONTACT:

    Daniel Cohen, U.S. Department of Energy, Office of the General Counsel, 1000 Independence Avenue SW., Washington, DC 20585. Telephone: (202) 586-5000. Email: [email protected].

    SUPPLEMENTARY INFORMATION:

    On January 30, 2017, the President issued Executive Order 13771, “Reducing Regulation and Controlling Regulatory Costs.” That Order stated the policy of the executive branch is to be prudent and financially responsible in the expenditure of funds, from both public and private sources. The Order stated it is essential to manage the costs associated with the governmental imposition of private expenditures required to comply with Federal regulations. Toward that end, for fiscal year 2017, E.O. 13771 requires:

    (1) “Unless prohibited by law, whenever an executive department or agency . . . publicly proposes for notice and comment or otherwise promulgates a new regulation, it shall identify at least two existing regulations to be repealed.” Sec. 2(a).

    (2) “For fiscal year 2017, . . . the heads of all agencies are directed that the total incremental cost of all new regulations, including repealed regulations, to be finalized this year shall be no greater than zero, unless otherwise required by law or consistent with advice provided in writing by the Director of the Office of Management and Budget . . . .” Sec. 2(b).

    (3) “In furtherance of the requirement of subsection (a) of this section, any new incremental costs associated with new regulations shall, to the extent permitted by law, be offset by the elimination of existing costs associated with at least two prior regulations.” Sec. 2(c).

    Further, the Executive Order requires that for fiscal year 2018, and for each fiscal year thereafter, the head of each agency shall identify, for each regulation that increases incremental cost, offsetting regulations, and provide the agency's best approximation of the total costs or savings associated with each new regulation or repealed regulation. During the Presidential budget process beginning in fiscal year 2018 and for each year thereafter, the Director of the Office of Management and Budget (Director) will identify to each agency a total amount of incremental costs that will be allowed for such agency in issuing new regulations and repealing regulations for the next fiscal year. No regulations exceeding the agency's total incremental cost allowance will be permitted in that fiscal year, unless required by law or approved in writing by the Director. The total incremental cost allowance may allow an increase or require a reduction in total regulatory cost.

    Additionally, on February 24, 2017, the President issued Executive Order 13777, “Enforcing the Regulatory Reform Agenda.” The Order required the head of each agency designate an agency official as its Regulatory Reform Officer (RRO). Each RRO shall oversee the implementation of regulatory reform initiatives and policies to ensure that agencies effectively carry out regulatory reforms, consistent with applicable law. Further, E.O. 13777 requires the establishment of a regulatory task force at each agency. The regulatory task force will make recommendations to the agency head regarding the repeal, replacement, or modification of existing regulations, consistent with applicable law. At a minimum, each regulatory reform task force shall attempt to identify regulations that:

    (i) Eliminate jobs, or inhibit job creation;

    (ii) Are outdated, unnecessary, or ineffective;

    (iii) Impose costs that exceed benefits;

    (iv) Create a serious inconsistency or otherwise interfere with regulatory reform initiatives and policies;

    (v) Are inconsistent with the requirements of Information Quality Act, or the guidance issued pursuant to that Act, in particular those regulations that rely in whole or in part on data, information, or methods that are not publicly available or that are insufficiently transparent to meet the standard for reproducibility; or

    (vi) Derive from or implement Executive Orders or other Presidential directives that have been subsequently rescinded or substantially modified.

    Finally, on March 28, 2017, the President signed Executive Order 13783, entitled “Promoting Energy Independence and Economic Growth. Among other things, E.O. 13783 requires the heads of agencies to review all existing regulations, orders, guidance documents, policies, and any other similar agency actions (collectively, agency actions) that potentially burden the development or use of domestically produced energy resources, with particular attention to oil, natural gas, coal, and nuclear energy resources. Such review does not include agency actions that are mandated by law, necessary for the public interest, and consistent with the policy set forth elsewhere in that order.

    Executive Order 13783 defined burden for purposes of the review of existing regulations to mean to unnecessarily obstruct, delay, curtail, or otherwise impose significant costs on the siting, permitting, production, utilization, transmission, or delivery of energy resources.

    To implement these Executive Orders, the Department is taking two immediate steps. First, as described further below, the Department is issuing this Request for Information (RFI) seeking public comment on how best to achieve meaningful burden reduction while continuing to achieve the Department's regulatory objectives. Second, the Department has created an email in-box at [email protected], which interested parties can use to identify to DOE—on a continuing basis—existing regulations, paperwork requirements and other regulatory obligations that can be modified or repealed, consistent with law. Together, these steps will help the Department ensure it acts in a prudent and financially responsible manner in the expenditure of funds, from both public and private sources, and manages appropriately the costs associated with private expenditures required for compliance with DOE regulations.

    Request for Information

    Pursuant to the Executive Orders, the Department is, through this request for information, seeking input and other assistance, as permitted by law, from entities significantly affected by regulations of the Department of Energy, including State, local, and tribal governments, small businesses, consumers, non-governmental organizations, and manufacturers and their trade associations. The Department's goal is to create a systematic method for identifying those existing DOE rules that are obsolete, unnecessary, unjustified, or simply no longer make sense.

    Consistent with the Department's commitment to public participation in the rulemaking process, the Department is beginning this process by soliciting views from the public on how best to conduct its analysis of existing DOE rules. It is also seeking views from the public on specific rules or Department imposed obligations that should be altered or eliminated. While the Department promulgates rules in accordance with the law and to the best of its analytic capability, it is difficult to be certain of the consequences of a rule, including its costs and benefits, until it has been tested. Because knowledge about the full effects of a rule is widely dispersed in society, members of the public are likely to have useful information and perspectives on the benefits and burdens of existing requirements and how regulatory obligations may be updated, streamlined, revised, or repealed to better achieve regulatory objectives, while minimizing regulatory burdens, consistent with applicable law. Interested parties may also be well-positioned to identify those rules that are most in need of reform, and, thus, assist the Department in prioritizing and properly tailoring its review process. In short, engaging the public in an open, transparent process is a crucial first step in DOE's review of its existing regulations.

    List of Questions for Commenters

    To allow DOE to more effectively evaluate suggestions, the Department is requesting comments include:

    • Supporting data or other information such as cost information

    • Specific suggestions regarding repeal, replacement, or modification.

    The following list of questions represents a preliminary attempt by DOE to identify rules/obligations on which it should immediately focus. This non-exhaustive list is meant to assist in the formulation of comments and is not intended to restrict the issues that may be addressed. In addressing these questions or others, DOE requests that commenters identify with specificity the regulation or reporting requirement at issue, providing legal citation where available. The Department also requests that the submitter provide, in as much detail as possible, an explanation why a regulation or reporting requirement should be modified, streamlined, or repealed, as well as specific suggestions of ways the Department can do so while achieving its regulatory objectives.

    (1) How can DOE best promote meaningful regulatory cost reduction while achieving its regulatory objectives, and how can it best identify those rules that might be modified, streamlined, or repealed?

    (2) What factors should DOE consider in selecting and prioritizing rules and reporting requirements for reform?

    (3) How can DOE best obtain and consider accurate, objective information and data about the costs, burdens, and benefits of existing regulations? Are there existing sources of data DOE can use to evaluate the post-promulgation effects of regulations over time? We invite interested parties to provide data that may be in their possession that documents the costs, burdens, and benefits of existing requirements.

    (4) Are there regulations that simply make no sense or have become unnecessary, ineffective, or ill-advised and if so what are they? Are there rules that can simply be repealed without impairing DOE's statutory obligations and, if so, what are they?

    (5) Are there rules or reporting requirements that have become outdated and, if so, how can they be modernized to better accomplish their objective?

    (6) Are there rules that are still necessary, but have not operated as well as expected such that a modified, or slightly different approach at lower cost is justified?

    (7) Are there rules of the Department that unnecessarily obstruct, delay, curtail, or otherwise impose significant costs on the siting, permitting, production, utilization, transmission, or delivery of energy resources?

    (8) Does DOE currently collect information that it does not need or use effectively?

    (9) Are there regulations, reporting requirements, or regulatory processes that are unnecessarily complicated or could be streamlined to achieve statutory obligations in more efficient ways?

    (10) Are there rules or reporting requirements that have been overtaken by technological developments? Can new technologies be leveraged to modify, streamline, or do away with existing regulatory or reporting requirements?

    (11) Does the methodology and data used in analyses supporting DOE's regulations meet the requirements of the Information Quality Act?

    The Department notes that this RFI is issued solely for information and program-planning purposes. While responses to this RFI do not bind DOE to any further actions related to the response, all submissions will be made publicly available on www.regulations.gov.

    Issued in Washington, DC, on May 19, 2017. Daniel R. Simmons, Chair, Department of Energy Regulatory Reform Task Force.
    [FR Doc. 2017-10866 Filed 5-26-17; 8:45 am] BILLING CODE 6450-01-P
    DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 1217 [Document Number AMS-SC-16-0066] Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order; De Minimis Quantity Exemption Threshold AGENCY:

    Agricultural Marketing Service, USDA.

    ACTION:

    Proposed rule.

    SUMMARY:

    This action proposes to establish a de minimis quantity exemption threshold under the Softwood Lumber Research, Promotion, Consumer Education and Industry Information Order (Order). The Order is administered by the Softwood Lumber Board (Board) with oversight by the U.S. Department of Agriculture (USDA). In response to a 2016 federal district court decision, USDA conducted a new analysis to determine a reasonable and appropriate de minimis threshold. Based on that analysis contained herein, this proposal would establish the de minimis quantity threshold at 15 million board feet (mmbf) and entities manufacturing (and domestically shipping) or importing less than 15 mmbf per year would be exempt from paying assessments under the Order.

    DATES:

    Comments must be received by July 31, 2017.

    ADDRESSES:

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

    FOR FURTHER INFORMATION CONTACT:

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

    SUPPLEMENTARY INFORMATION:

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

    Executive Order 12866 and Executive Order 13563

    Executive Orders 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules and promoting flexibility. This action falls within a category of regulatory actions that the Office of Management and Budget (OMB) exempted from Executive Order 12866 review. Additionally, because this rule does not meet the definition of a significant regulatory action it does not trigger the requirements contained in Executive Order 13771. See OMB's Memorandum titled “Interim Guidance Implementing Section 2 of the Executive Order of January 30, 2017 titled `Reducing Regulation and Controlling Regulatory Costs' ” (February 2, 2017).

    Executive Order 13175

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

    Executive Order 12988

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

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

    Background

    This proposed rule would establish a de minimis quantity exemption threshold under the Order. The Order, codified at 7 CFR part 1217, is administered by the Board with oversight by USDA's Agricultural Marketing Service (AMS). In Resolute Forest Products Inc., v. USDA, et al. (Resolute), the court found that, on the basis of the estimates and information submitted by the government to the court for review, the selection of 15 mmbf as the de minimis quantity (to be exempted) under the Order was arbitrary and capricious and that the Order was therefore promulgated unlawfully. The court did not vacate (or terminate) the Order; the court remanded the matter to USDA and program requirements remain in effect.

    To address the court's decision, USDA conducted a new analysis to determine a reasonable and appropriate de minimis quantity exemption. USDA analyzed various thresholds of exemption: 10, 15, 20, 25, and 30 mmbf. USDA also considered proposing no de minimis exemption. USDA's analysis of the data resulted in a determination that a de minimis level of 15 mmbf is reasonable and appropriate. Therefore, this proposal would establish the de minimis quantity threshold under the Order at 15 mmbf.

    Authority in the 1996 Act

    The 1996 Act authorizes USDA to establish agricultural commodity research and promotion orders which may include a combination of promotion, research, industry information, and consumer information activities funded by mandatory assessments. These programs are designed to maintain and expand markets and uses for agricultural commodities. As defined under section 513(1)(D) of the 1996 Act, agricultural commodities include the products of forestry, which includes softwood lumber.

    The 1996 Act provides for a number of optional provisions that allow the tailoring of orders for different commodities. Section 516 of the 1996 Act provides permissive terms for orders. Section 516 states that an order may include an exemption of de minimis quantities of an agricultural commodity. Further, section 516(g) of the 1996 Act provides authority for other action that is consistent with the purpose of the statute and necessary to administer a program.

    Overview of the Softwood Lumber Program

    The softwood lumber program took effect in August 2011 (76 FR 46185) and assessment collection began in January 2012. Under the Order, assessments are collected from domestic (U.S.) manufacturers and importers and are used by the Board for projects that promote market growth for softwood lumber products used in single and multi-family dwellings as well as commercial construction. The Board is composed of 19 industry members (domestic manufacturers and importers) who are appointed by the Secretary of Agriculture. The purpose of the program is to strengthen the position of softwood lumber in the marketplace, maintain and expand markets for softwood lumber, and develop new uses for softwood lumber within the United States.

    Relevant Order Provisions Domestic Manufacturers

    The term `domestic manufacturer' is defined in section 1217.8 of the Order to mean any person who is a first handler engaged in the manufacturing, sale and shipment of softwood lumber in the United States during a fiscal period and who owns, or shares in the ownership and risk of loss of manufacturing of softwood lumber or a person who is engaged in the business of manufacturing, or causes to be manufactured, sold and shipped such softwood lumber in the United States beyond personal use. The term does not include persons who re-manufacture softwood lumber that has already been subject to assessment. The term `manufacture' is defined in section 1217.13 of the Order to mean the process of transforming (or turning) softwood logs into softwood lumber.

    Domestic manufacturers are essentially sawmills that turn softwood logs into lumber. A domestic manufacturer may be a company that is a single sawmill, or it may be a company that is composed of multiple sawmills.

    Importers

    The term `importer' is defined in section 1217.11 of the Order to mean any person who imports softwood lumber from outside the United States for sale in the United States as a principal or as an agent, broker, or consignee of any person who manufactures softwood lumber outside the United States for sale in the United States, and who is listed in the import records as the importer of record for such softwood lumber. Import records are maintained by the U.S. Customs and Border Protection (Customs or CBP). Both domestic manufacturers and importers may be referred to in this rulemaking as “entities.”

    Expenses and Assessments

    Pursuant to section 1217.50 of the Order, the Board is authorized to incur expenses for research and promotion projects as well as administration. The Board's expenses are paid by assessments upon domestic manufacturers and importers. Pursuant to section 1217.52(b), and subject to the exemptions specified in section 1217.53 of the Order, each domestic manufacturer and importer must pay an assessment to the Board at the rate of $0.35 per thousand board feet of softwood lumber, except that no entity has to pay an assessment on the first 15 mmbf of softwood lumber otherwise subject to assessment in a fiscal year. Domestic manufacturers pay assessments based on the volume of softwood lumber shipped within the United States and importers pay assessments based on the volume of softwood lumber imported to the United States. Pursuant to paragraphs (d) and (j) in section 1217.52, respectively, domestic manufacturers and importers who pay their assessments to the Board must do so no later than the 30th calendar day of the month following the end of the quarter in which the softwood lumber was shipped or imported.

    Exemptions

    Section 1217.53 of the Order prescribes exemptions from assessment. Pursuant to paragraph (a) of that section, the original de minimis quantity exemption threshold under the Order was 15 mmbf. Thus, U.S. manufacturers and importers that domestically ship and/or import less than 15 mmbf feet annually have been exempt from paying assessments. Domestic manufacturers and importers that ship or import less than the de minimis quantity of softwood lumber must apply to the Board each year for a certificate of exemption and provide documentation as appropriate to support their request.

    Pursuant to paragraph (b) of section 1217.53 of the Order, domestic manufacturers and importers that ship or import 15 mmbf or more annually do not pay assessments on their first 15 mmbf domestically shipped or imported. This exemption is intended for the purpose of creating an equality amongst those within the industry with regard to the program's assessment. Just as those that manufacture or import under 15 mmbf do not have to pay assessments, those at or above this level may reduce their assessable volume by 15 mmbf.1 For example, an entity that ships or imports 20 mmbf annually only has to pay assessments on 5 mmbf of softwood lumber. This exemption creates fairness; it levels the playing field because all entities, regardless of size, do not have to pay assessments on their first 15 mmbf shipped or imported. For purposes of this document, this exemption is referred to as the “equity exemption.” Pursuant to paragraphs (c) and (d) of section 1217.53, respectively, exports of softwood lumber from the United States and organic softwood lumber are also exempt from assessment.

    1 USDA notes that the de minimis level and the equity exemption are purposefully aligned and any change in the de minimis would result in a corresponding modification to the equity exemption.

    Reports and Records

    Pursuant to section 1217.70 of the Order, domestic manufacturers and importers who pay their assessments directly to the Board must submit with their payment a report that specifies the quantity of softwood lumber domestically shipped or imported. Pursuant to section 1217.71 of the Order, all domestic manufacturers and importers must maintain books and records necessary to verify reports for a period of 2 years beyond the fiscal year to which they apply, including those exempt. These records must be made available during normal business hours for inspection by Board staff or USDA.

    Other Relevant Order Provisions

    The original 15 mmbf quantity exemption threshold is referenced in other Order provisions. Section 1217.40 specifies that the Board is composed of domestic manufacturers and importers who domestically ship or import 15 mmbf or more of softwood lumber annually. Section 1217.41 of the Order specifies that persons interested in serving on the Board must also domestically ship or import 15 mmbf or more softwood lumber annually. Finally, section 1217.101 of the Order regarding referendum procedures specifies that eligible domestic manufacturers and importers that can vote in referenda must domestically ship or import 15 mmbf or more of softwood lumber annually.

    Initial Referendum and Summary of Board Activities

    The softwood lumber program was implemented after notice and comment rulemaking and a May 2011 referendum demonstrating strong support for the program. Pursuant to section 1217.81(a) of the Order, the program had to pass by a majority of those voting in the referendum who also represented a majority of the volume voted. Sixty-seven percent of the entities who voted, who together represented 80 percent of the volume, in the referendum favored implementation of the program. Entities that domestically shipped or imported 15 mmbf or more of softwood lumber annually were eligible to vote in the referendum. As previously mentioned, the program took effect in August 2011 and assessment collection began in January 2012.

    The softwood lumber program has continued to operate at the 15 mmbf exemption threshold since its inception. During these years, the Board has funded a variety of activities designed to increase the demand for softwood lumber. The Board funded a U.S. Tall Wood Building Prize Competition that is helping to showcase the benefits of building tall structures with wood. The Board also funds research on wood standards; a communications program, which includes continuing education courses for architects and engineers; and a construction and design program that provides technical support to architects and structural engineers about using wood.

    Analysis of the De Minimis Quantity Under the Softwood Lumber Program

    The Secretary has authority under section 516 of the 1996 Act to exempt any de minimis quantity of an agricultural commodity otherwise covered by an order: “An order issued under this subchapter may contain . . . authority for the Secretary to exempt from the order any de minimis quantity of an agricultural commodity otherwise covered by the order . . . .” 7 U.S.C. 7415(a). A de minimis quantity exemption allows an industry to exempt from assessment small entities that could be unduly burdened from an order's requirements (i.e., assessment and quarterly reporting obligations). Because the 1996 Act does not prescribe the methodology or formula for computing a de minimis quantity, the Secretary has discretion to determine a reasonable and appropriate quantity and establish this level through notice and comment rulemaking. Pursuant to section 525 of the 1996 Act, 7 U.S.C. 7424, the Secretary may issue such regulations as may be necessary to carry out an order.

    In evaluating the merits of a de minimis quantity for the softwood lumber program, USDA considered several factors. These factors include: An estimate of the total quantity of softwood lumber covered under the Order (quantity assessed and quantity exempted); available funding to support a viable program; free rider implications; and the impact of program requirements on entities (above and below a de minimis threshold). USDA reviewed such factors in light of all available data and information to determine whether a de minimis quantity is reasonable. USDA balances the multiple factors to assess whether one exemption threshold would work better than another when the factors are considered collectively. The analysis contained herein is based on the current assessment rate of $0.35 per thousand board feet.2

    2 If the assessment rate changes significantly, USDA could revisit the de minimis threshold.

    Estimate of Total Quantity of Commodity Covered Under the Order

    The first factor considered to determine a de minimis quantity that would be reasonable for the softwood lumber program was an examination of how much of the product covered by the program would be assessed versus how much of the product would be exempted. Issues of fairness and potential issues related to free riders may also be of concern. The lower the de minimis threshold, the greater the number of entities that would be subject to assessment under the program. At some point, a de minimis threshold can be “too low” whereby the assessment revenue that would be collected from very small entities is not worth the administration and compliance costs of including them under the order. Conversely, a higher de minimis quantity results in fewer entities being subject to assessment under the order. This means that a greater number of entities would benefit from the activities of the program without paying assessment as the de minimis level increases. USDA's goal is to identify a level that reasonably balances these competing issues.

    To evaluate the first factor, USDA estimated the quantity of softwood lumber that would be assessed versus the quantity that would be exempt under a program with de minimis exemptions at different levels: 10, 15, 20, 25, and 30 mmbf. USDA also estimated the quantity of softwood lumber assessed if there were no de minimis exemption. To accomplish this, USDA first estimated the volume of softwood lumber domestically shipped by domestic manufacturers and the volume imported by importers.

    Volume of Domestic Softwood Lumber

    To estimate the volume of domestic softwood lumber, USDA utilized data from Forest Economic Advisors, LLC (FEA), which publishes data on aggregate softwood lumber shipments in the U.S. (for the industry as a whole) and operating capacity by individual sawmill. A sawmill is a business operation that converts raw forest products into lumber. A domestic manufacturer can be composed of one sawmill or multiple sawmills. A sawmill's operating capacity is the total amount of softwood lumber that it could manufacture (or produce) if it fully utilized all of its resources (such as labor and equipment).

    FEA is a U.S.-based company that studies market trends in the forest products industry in North America.3 In the absence of a government data source, USDA identified FEA as a reputable source in the softwood lumber industry with data depicting a reliable and accurate representation of U.S. sawmills and domestic manufacturers.4 Among the credentials of FEA are reviews of U.S. Forest Service publications, and citations in trade journals such as Canadian Journal of Forest Research; Biomass and Bioenergy; Forest Policy and Economics; and Forest Products Journal.

    3http://www.bloomberg.com/research/stocks/private/snapshot.asp?privcapid=106682714.

    4 The final rule (76 FR 46185; August 2, 2011) utilized data from the USDA-Forest Service document “Profile 2009: Softwood Sawmills in the United States and Canada.” There have been no recent updates to this publication; therefore, USDA has instead utilized data from FEA to conduct this analysis.

    To USDA's knowledge, there is no one, complete source of individual shipment data for domestic manufacturers of softwood lumber. While the Board has shipment data for domestic manufacturers that pay assessments (ship 15 mmbf or more annually), it does not have shipment data for exempt manufacturers. Thus, USDA used FEA data to estimate individual shipments for each manufacturer. USDA requests comments specifically on whether there are other reliable sources that the agency should consider in its analysis of domestic manufacturing. All data in this analysis is for the year 2015, which is the most recent year for which complete data is available.

    Using FEA data to estimate shipments of softwood lumber by domestic manufacturers, USDA found that domestic shipments totaled 28.754 billion board feet (bbf) in 2015.5 According to FEA, the total number of domestic manufacturers was 343, which encompassed 509 total sawmills in the U.S. Estimated shipments by domestic manufacturer were calculated by applying an operating rate of 76 percent to the capacities of each sawmill listed in FEA data. The domestic manufacturers that owned each sawmill were also identified in the FEA data. This allowed USDA to assign the estimated shipments of each sawmill to the domestic manufacturer that owned the sawmill.

    5https://www.getfea.com/data-center.

    To calculate the sawmill operating rate, USDA divided total shipments in the U.S.6 by total capacity of U.S. sawmills, according to data published by FEA (see Equation 1 below).

    6 Total shipments in the U.S. includes domestic production for export markets.

    EP30MY17.000 USDA recognizes that some sawmills may operate at a lower or higher rate than 76 percent; this rate is meant to serve as a midpoint to estimate the individual shipments of domestic manufacturers.

    Total U.S. softwood lumber shipments in Equation 1 above differs from the total estimated shipments noted previously and shown later in Table 1. The reason for this is that the figure for total U.S. shipments in Equation 1 represents aggregate shipments for all sawmills in the U.S. in 2015. The figure shown in Table 1 is the sum of estimated shipments using the 76 percent sawmill operating rate. In order to estimate shipments by domestic manufacturer, USDA applied the sawmill operating rate, as determined in Equation 1, to the capacities of each sawmill listed in FEA data. The sum of these estimated shipments is 28.754 bbf. The difference between estimated total shipments (28.754 bbf) and actual total shipments (31.702 bbf) of softwood lumber in 2015 is about 9 percent. This difference represents the actual capacities of some sawmills being larger than the estimated sawmill operating rate of 76 percent.

    Volume of Imported Softwood Lumber

    Pursuant to section 1217.52(g) of the Order, imports of softwood lumber are subject to the same assessment as domestic product. Section 1217.52(h) of the Order specifies the categories of softwood lumber that are assessed under the program as identified via the Harmonized Tariff Schedule (HTS) code. Imported commodities are assigned codes via the HTS with the first numbers denoting the heading, which is a broad description of the commodity, and the subsequent numbers denoting the subheadings, which specify the commodity in greater detail. A list of softwood lumber products subject to assessment and their HTS headings and subheadings are listed below.7

    7 Harmonized Tariff Schedule of the United States (2015): Chapter 44: Wood and Articles of Wood; Wood Charcoal.

    EP30MY17.001

    To estimate imports of softwood lumber into the U.S. for 2015, USDA utilized data collected by CBP via the agency's Automated Commercial Environment (ACE) database. CBP disseminates the statistical trade data that it collects to the U.S. Census Bureau (Census), which then aggregates the data and supplies it to USDA's Foreign Agricultural Service (FAS) for publication on FAS' Global Agricultural Trade System (GATS).8 The data collected by CBP is extensive but may be subject to nonsampling error.9

    8https://apps.fas.usda.gov/gats/.

    9 The source for this citation is http://www.census.gov/foreign-trade/guide/sec2.html#source. Census states the following on its Web site: “Import and export data are a complete enumeration of documents collected by U.S. Customs and Border Protection and are not subject to sampling errors. However, while quality assurance procedures are performed at every stage of collection, processing, and tabulation, the data are still subject to several types of nonsampling errors. The most significant of these include reporting errors, undocumented shipments, timeliness, data capture errors, transiting goods, and underestimation of low-valued transactions.”

    For the purpose of this analysis, USDA excluded from the CBP data imports with country of origin listed as the U.S. because such information would already be represented in the domestic shipment data previously discussed. USDA also summed import volumes for entities listed as separate companies, but which are one and the same. In addition, USDA excluded the Customs entries for which the computed price (the quotient of value and quantity) of the commodity was less than the lowest reported monthly price for the year 2015, according to FEA data.10 The lowest monthly price for a softwood lumber product recorded by FEA was $203 per thousand board feet in December of 2015. USDA excluded any Customs entry with a computed price of less than $203 per thousand board feet to help eliminate potential data issues associated with misplaced decimal points.11 This resulted in a reduction of 17,026 entries and 3.417 bbf in volume from the original data set that had a total of 247,049 entries and total volume of 15.912 bbf.

    10 Customs data includes quantity of the imported product and its total value. By dividing value by quantity, USDA finds a price per thousand board feet of every import entry, referred to above as a “computed price.” Finding the price for every entry allows USDA a way to find entries whose quantities may have been entered incorrectly.

    11 A misplaced decimal point in the quantity imported could cause the quantity of an import to be much larger than its associated value would warrant. A larger quantity relative to its value would result in a price that is much lower than expected, given other prices in the data. This low price would indicate that the quantity figure may have been entered incorrectly. For this reason, USDA found the minimum per thousand board foot price according to FEA data and removed the entries whose computed price was lower.

    Using this modified CBP data, USDA estimated the total volume of softwood lumber imports for 2015 at 12.495 bbf, which aligns more closely to import figures published on FAS' GATS (13.809 bbf) and used by FEA (13.963 bbf) for 2015. Using the 12.495 bbf figure, USDA's estimate of assessment revenue for 2015 at the 15 mmbf exemption threshold was within 3 percent of what the Board recorded for assessment revenue in 2015. (This is explained in detail later in this document.) If USDA used the 15.912 bbf figure instead, USDA's estimates for 2015 assessment revenue and the number of assessed entities would be inflated. Thus, USDA used the modified CBP figure of 12.495 bbf in its analysis as a reasonable estimate of 2015 softwood lumber imports.

    The import statistics that result from aggregation by Census cover “goods valued at more than $2,000 per commodity shipped by individuals and organizations (including importers and customs brokers) into the U.S. from other countries.” 12 For this reason, the total import volume of softwood lumber that results from using the ACE portal through CBP differs from that of using GATS through FAS and Census.

    12http://www.census.gov/foreign-trade/about/index.html#importstatistics.

    Similar to the import statistics described above, the aggregated export statistics cover “goods valued at more than $2,500 per commodity shipped by individuals and organizations (including exporters, freight forwarders, and carriers) from the U.S. to other countries.” 13 In conducting this analysis, USDA relied on aggregate U.S. export data published by FAS via GATS.14 Pursuant to section 1217.53(c) of the Order, U.S. exports of softwood lumber are not subject to assessment. While it is possible to subtract exports in aggregate from total U.S. supply in order to find U.S. utilization and total volume assessed under no de minimis threshold, USDA cannot deduct export volume by entity because the data is not publically available. This means that estimates of assessed volume may be slightly inflated; however, the impact would not be significant as total exports of softwood lumber products in 2015 amounted to 1.562 bbf, which is less than 4 percent of total U.S. supply.

    13http://www.census.gov/foreign-trade/about/index.html#exportstatistics.

    14 USDA does not currently have access to CBP U.S. export data with volume and value detailed by exporting entity.

    Quantity Assessed and Quantity Exempt

    Table 1 shows total U.S. supply of softwood lumber, which is the sum of domestic shipments and imports in 2015. As mentioned previously, shipments per entity were estimated using the sawmill operating rate shown in Equation 1. Total shipments in Table 1 represent the sum of shipments by entity. Imports in Table 1 are the sum of the imported commodities assigned the formerly described HTS codes. Summing domestic shipments and imported products of softwood lumber results in a U.S. total supply of 41.249 bbf.

    EP30MY17.002

    Using 2015 FEA sawmill capacity data and the estimated operating rate of 76 percent, Figure 1 below shows the number of softwood lumber manufacturers in the U.S. in 2015 by estimated shipments. As stated previously, USDA calculated estimated shipments by applying the estimated industry-wide 76 percent operating rate to the sawmill capacity of each manufacturer.

    EP30MY17.003 As the graph shows, there were 165 manufacturers with estimated shipments of less than 15 mmbf in the U.S. in 2015, almost half of the 344 total U.S. manufacturers. Of these, 150 manufacturers had shipments of less than 10 mmbf according to USDA's analysis of FEA data.15 The scale on the x-axis of the graph begins with a range of 15 mmbf. The ranges then double each time, with the next covering a range of 30 mmbf, then 60, 120, 240, 480, 960, and 1,920 mmbf for the last six ranges. There were a large number of manufacturers with relatively small estimated shipments. For example, as the data in Figure 1 show, there were 248 U.S. manufacturers that shipped of less than 45 mmbf in 2015, which is more than 72 percent of the total number of U.S. manufacturers. Furthermore, of these, almost 67 percent shipped less than 15 mmbf of softwood lumber.

    15https://www.getfea.com/data-center.

    USDA considered the impacts of five different de minimis thresholds on the softwood lumber industry and program operations, as well as the impact of having no de minimis exemption. An analysis of these different de minimis exemption levels follows in Tables 2 and 3 in this section, and in Table 4 in the section of this document titled Free Rider Implications.

    EP30MY17.004

    Table 2 shows assessable volume and revenue at exemption levels of 30, 25, 20, 15 and 10 mmbf, as well as with no exemptions. The table accounts for both the de minimis and equity exemptions under the Order, and an assessment rate of $0.35 per thousand board feet.

    With de minimis and equity exemptions of 30 mmbf, total assessable volume would be 32.805 bbf which would provide $11.482 million in assessment revenue. At exemptions of 25 mmbf, total assessable volume would increase by 0.889 bbf, providing an additional $311,243 in assessment revenue. At exemptions of 20 mmbf, total assessable volume would increase by 0.996 bbf, providing an additional $348,408 in assessment revenue. At exemptions of 15 mmbf, total assessable volume would increase by 1.164 bbf, providing an additional $407,444 in assessment revenue. At exemptions of 10 mmbf, total assessable volume would increase by 1.329 bbf, providing an additional $465,267 in assessment revenue.

    Thus, for all exemption levels considered, assessable volume ranged between almost 33 bbf and a little more than 37 bbf. Assessment revenue ranged between nearly $11.5 million and about $13 million. From its inception in 2012, the softwood lumber program has operated with assessment revenue ranging from $10.638 million in 2012 16 to $12.905 million in 2015.17 These revenue figures represent the total assessments collected from domestic entities and importers with the 15 mmbf de minimis exemption and the 15 mmbf equity exemption in place. The range of actual assessment revenue received by the Board from 2012 to 2015 at de minimis and equity exemptions of 15 mmbf is similar to the estimates of assessment revenue collected at de minimis and equity exemptions of 30, 25, 20, 15, and 10 shown in Table 2. This is discussed further in the section titled Funding for a Viable Program. With no exemptions, total assessable volume would increase to 41.249 bbf, providing an additional $1.423 million in assessment income ($14.437 million total).

    16 Softwood Lumber Board, Financial Statements and Supplementary Information for the Year Ending December 31, 2012; Councilor Buchanan Mitchell, CPAs and Business Advisors; May 30, 2013; p. 12.

    17 Letter from E. Albert Weber, CPA, Partner, RSM US LLC, dated February 22, 2017.

    Table 3 below is the inverse of Table 2 in that it shows exempt volume at de minimis and equity exemptions of 30, 25, 20, 15 and 10 mmbf.

    EP30MY17.005

    At an exemption level of 30 mmbf, 8 percent of the softwood lumber volume would be exempt as de minimis and 20 percent would be exempt in total (de minimis and equity exemptions); at an exemption of 25 mmbf, 7 percent would be exempt as de minimis and 18 percent would be exempt in total; at an exemption of 20 mmbf, 5 percent would be exempt as de minimis and 16 percent would be exempt in total; at an exemption of 15 mmbf, 4 percent would be exempt as de minimis and 13 percent would be exempt in total; and at an exemption of 10 mmbf, 3 percent would be exempt as de minimis and 10 percent would be exempt in total. Thus, the differences in the percent of softwood lumber exempt as de minimis at these different exemption thresholds ranges from 3 to 8 percent, and the percent exempt in total ranges from 10 to 20 percent. The percent of volume assessed, taking into account the de minimis and equity exemptions, ranges from 80 to 90 percent at the different exemption thresholds.

    In its analysis, USDA reviewed other programs with de minimis exemptions operating under the 1996 Act. There are ten programs, including softwood lumber, that are authorized under the 1996 Act. Eight of these ten programs exempt a de minimis quantity from assessment, with half currently exempting between 3 and 11 percent of total quantity covered by the program as de minimis. Thus, there is a demonstrated history of de minimis exemptions working in other industries. In reviewing the total volume exempt under the softwood lumber program (taking into account both the de minimis and equity exemptions), the exemption threshold of 10 mmbf would exempt 10 percent of total volume, which is comparable to other programs and the exemption threshold of 15 mmbf would exempt 13 percent which is not much higher than other programs. The higher exemption thresholds of 20 to 30 mmbf exempt a higher total volume when compared with other programs.18

    18 USDA's review of other programs with a de minimis exemption was done only for the purpose of comparison, and not to imply that a de minimis exemption must be within a certain range. The 1996 Act specifies no methodology or formula for computing a de minimis threshold. A de minimis threshold must be appropriate for a respective industry.

    Funding for a Viable Program

    The second factor used in evaluating a de minimis threshold for the softwood lumber program is the available funding to support a viable program. As shown in Table 2, assessment revenue would range from $11.482 million at an exemption threshold of 30 mmbf to $14.437 million with no exemption (a total difference of about $3 million). Lowering the exemption threshold creates more revenue for program activities because a greater volume of softwood lumber is subject to assessment. As stated previously, assessment revenue under the current softwood lumber program has ranged from about $10.638 million in 2012 to $12.905 million in 2015. At this level of revenue, the current program has seen success, funding various programs to increase the use of softwood lumber in the built environment. The revenues estimated in Table 2 are comparable to these levels or higher. Thus, all of the exemption thresholds analyzed would generate sufficient revenue for a viable program.

    Free Rider Implications

    Another factor used by USDA in determining a reasonable de minimis quantity for the softwood lumber program is consideration of free rider implications. Under a national research and promotion program, free riders are entities that benefit from the research and promotion activities of the program without paying assessments. Under this definition, free riders are the entities whose shipment or import volume is below the de minimis level and are exempt from paying assessments into the program.

    Table 4 below shows the number of entities (domestic manufacturers and importers) that would be assessed and exempt at the exemption thresholds of 30, 25, 20, 15 and 10 mmbf.

    EP30MY17.006

    At an exemption level of 30 mmbf, 16 percent of domestic manufacturers and importers would pay assessments while 84 percent would be exempt; at 25 mmbf, 18 percent of entities would pay assessments while 82 percent would be exempt; at 20 mmbf, 20 percent would pay assessments while 80 percent would be exempt; at 15 mmbf, 24 percent would pay assessments, while 76 percent would be exempt; at 10 mmbf, 27 percent would be pay assessments while 73 percent would be exempt. With no exemption, all 1,054 entities, regardless of size, would pay assessments.

    This analysis shows that a small portion of softwood lumber manufacturers and importers ship or import the majority of the volume of softwood lumber in the industry. Most domestic manufacturers and importers ship or import relatively small volumes of product.

    The key to assessing the free rider implications of a de minimis quantity is not the number of entities exempt under a program (as shown in Table 4), but rather the volume of product exempt (as shown in Table 3). This is because the statute authorizes the exemption of a quantity of a commodity, not a number of entities. Assessments are based on volume shipped or imported and not on the number of entities; assessments are not paid by entities on a pro rata basis. At the 30 mmbf exemption level, 84 percent of the number of entities would be exempt, but only 8 percent of the volume would be exempt as de minimis. At the 25 mmbf exemption level, 82 percent of the number of entities would be exempt, but only 7 percent of the volume would be exempt as de minimis. At the 20 mmbf exemption level, 80 percent of the number of entities would be exempt, but only 5 percent of the volume would be exempt as de minimis. At the 15 mmbf exemption level, 76 percent of the number of entities would be exempt, but only 4 percent of the volume would be exempt as de minimis. At the 10 mmbf exemption level, 73 percent of the number of entities would be exempt, but only 3 percent of the volume would be exempt as de minimis. With no de minimis, all 1,054 entities would pay assessment on all 41.249 bbf volume of softwood lumber.

    The equity exemption would reduce the impact of free riders on the program because it reduces the assessment burden on assessment payers. Without this exemption, assessment payers would pay more, thereby increasing the free rider impact. For example, if the thresholds for de minimis and equity exemptions were 10 mmbf, Company A that ships 8 mmbf annually would pay no assessments, and Company B that ships 30 mmbf annually would have to pay assessments on 20 mmbf of softwood lumber. At an assessment rate of $0.35 per thousand board feet, this would compute to $7,000 in assessments. Without the equity exemption, Company A would still pay no assessments but Company B would have to pay assessments on 30 mmbf. This would compute to $10,500 in assessments, which is an additional burden of $3,500. Thus, the equity exemption reduces the burden of free riders on entities funding the program. It creates fairness because it exempts from assessment an equal volume from all entities, regardless of their size.

    Thus, based upon this analysis of free rider implications, any of the exemption thresholds reviewed would be reasonable because they would exempt from 3 to 8 percent of the volume of softwood lumber as de minimis. The equity exemption helps to reduce the free rider impact on the program by reducing the assessment burden equally on assessment payers.

    Further, generic promotion, research and information activities for agricultural commodities play a unique role in advancing the demand for such commodities, since such activities increase the total market for a product to the benefit of consumers and all producers. These generic activities can be of particular benefit to small producers who lack the resources or market power to advertise on their own. As contemplated by the 1996 Act, generic activities increase the general market demand for an agricultural commodity. For small manufacturers and importers, the benefit of increased market demand for softwood lumber would only be as great as their production capacities. Therefore, while generic promotion activities are of particular benefit to small manufacturers and importers, increased demand will also disproportionately benefit large manufacturers and importers as they will have greater resources (production capacity) to take full advantage of that increased demand.

    Impact of Program Requirements

    The fourth factor analyzed by USDA in determining a reasonable de minimis quantity for this program is consideration of the impact of program requirements on entities covered under a research and promotion program. As previously mentioned, the softwood lumber Order prescribes assessment and reporting obligations for domestic manufacturers and importers of softwood lumber. Entities that domestically ship or import at or above the de minimis threshold must pay assessments to the Board. The current assessment rate is $0.35 per thousand board feet; it can be increased to a maximum rate of $0.50 per thousand board feet by notice and comment rulemaking.

    To calculate the impact of the assessment rate on the revenue of an assessment payer, the assessment rate is divided by an average price. Using an average 2015 price of $330 per thousand board feet,19 the assessment rate as a percentage of price could range from 0.106 percent at the current assessment rate to 0.151 percent at the maximum assessment rate. This analysis helps identify the impact of the assessment rate on the revenues of assessment payers. At the current assessment rate of $0.35 per thousand board feet to the maximum assessment rate of $0.50 per thousand board feet, assessment payers would owe between 0.106 percent and 0.151 percent of their revenues, respectively.

    19 Random Lengths Publications, Inc.; www.randomlengths.com.

    Entities that pay assessments must also submit a report to the Board each quarter of the volume of softwood lumber shipped or imported for the respective quarter. Further, entities that ship or import less than the de minimis threshold must apply to the Board each year for a certificate of exemption and provide documentation as appropriate to support their request. The reporting and record keeping burdens are detailed later in this document in the section titled Paperwork Reduction Act.

    Additionally, the Board has implemented a process under the Order to help ensure compliance with Order provisions. Board staff reviews and analyzes Customs data provided by USDA to verify import assessments.20 For domestic manufacturers, the Board conducts periodic mail audits whereby manufacturers must submit documents to Board staff to verify assessments paid. Entities that ship or import less softwood lumber than the de minimis threshold and have received a certificate of exemption from the Board are relieved of this audit burden.

    20 Pursuant to a Memorandum of Understanding between USDA and Customs, USDA provides Board staff raw, unmodified Customs data. Board staff identifies the data for each importing entity that should pay assessments, makes modifications as appropriate, and compares that volume with the volume for which the importer paid assessments.

    As shown in Table 4, at an exemption threshold of 30 mmbf, 172 entities would pay assessments and 882 would be exempt; at 25 mmbf, 13 additional entities would pay assessments and the number of exempt entities would be reduced by 13; at 20 mmbf, 30 additional entities would pay assessments and the number of exempt entities would be reduced by 30; at 15 mmbf, an additional 40 entities would pay assessments and the number of exempt entities would be reduced by 40; at 10 mmbf, an additional 28 entities would pay assessments and the number of exempt entities would be reduced by 28. Thus, as the exemption threshold is reduced, more entities would be subject to the Order's assessment and quarterly reporting obligation, and the Board's mail audit program. Conversely, as the exemption threshold increases, fewer entities would have to pay assessments, submit quarterly reports, and participate in the Board's audit program.

    Further, a de minimis quantity exemption helps to reduce compliance costs under a research and promotion program. Compliance costs are an administrative cost to the Board, and section 1217.50(h) of the softwood lumber Order limits the Board's administrative expenses to 8 percent of the assessment and other income received by and available to the Board for a fiscal year. According to the Board, for 2015, compliance costs totaled $226,240 which computes to less than 2 percent of the Board's assessment revenue. These compliance costs are routine and include the amount of time the Board spends tracking and verifying assessments paid as well as educating industry members on program obligations. The costs of pursuing a compliance case against an entity that owes assessments to the Board varies depending upon the complexity of the case.

    Under the softwood lumber program, the de minimis threshold exempts the small manufacturer that, according to FEA, typically sells into markets that are specialized or very local. Based on its knowledge of other research and promotion programs, USDA estimates the current cost of an on-site audit of a single entity at $5,000 or more, depending upon travel and time involved. Thus, the cost to pursue a compliance case against an entity that shipped less than 10 mmbf, 9 mmbf for example, would outweigh the revenue that would be collected from that entity of $3,150.21 The point at which the assessment revenue that would be collected from an entity outweighs the estimated cost of $5,000 to pursue a compliance case is an entity with volume equal to or greater than 14.3 mmbf.22 This level is close to 15 mmbf. As can be determined from the data in Table 2, the total additional revenue that would be collected from exempt entities that ship or import less than the 15 mmbf de minimis would be $1.888 million. The compliance costs to pursue these additional payments, however, would be more than double the sum of additional assessment revenue that would be collected.

    21 This figure is computed by multiplying the assessment rate of $0.35 per thousand board feet by 9 mmbf.

    22 This figure is computed by dividing the estimated cost to pursue a compliance case against an entity of $5,000 by the assessment rate of $0.35 per thousand board feet.

    USDA's Proposed 15 MMBF De Minimis Exemption Threshold

    Because no de minimis quantity is specified in the 1996 Act, it is within the Secretary's discretion to determine an appropriate level for each program. There is no formula or economic framework that points to a single de minimis threshold. Thus, USDA considers a range of quantities that could be de minimis. Table 3, for example, shows a range of volumes from 10 to 30 mmbf that could be considered de minimis under the softwood lumber Order because they only exempt 3 to 8 percent of the total volume, respectively, as de minimis. USDA evaluated these volumes using four factors—an estimate of the quantity assessed versus the quantity exempted; funding to support a viable program; free rider implications; and the impact of program requirements. USDA's goal is to identify a de minimis quantity that reasonably balances these factors, and to assess whether one exemption threshold would work better than another when the factors are considered collectively.

    Based on the analysis contained herein, USDA has determined the following. Exemption thresholds of 10 to 15 mmbf would exempt 10 to 13 percent of the total volume of softwood lumber (taking into account both the de minimis and equity exemptions). This is close to the range exempt under other research and promotion programs. While all of the exemption thresholds analyzed would generate sufficient revenue for a viable program, the additional revenue that could be collected if the de minimis level were reduced much lower than 15 mmbf would likely not be worth the additional costs. At this threshold, free rider implications would be minimal because only 4 percent of the volume of softwood lumber would be exempted as de minimis. Applying both the de minimis and equity exemptions at 15 mmbf would allow the program to assess almost 90 percent of the total volume of softwood lumber.

    Further, the program functioned successfully in 2015 with assessment revenue of $12.905 million with de minimis and equity exemptions of 15 mmbf. The Board has conducted activities at this level of funding that have helped build demand for softwood lumber, including a prize competition for tall wood buildings, research on wood standards, and an education program for architects and engineers on building with wood. An independent evaluation completed in 2016 concluded that activities of the Board increased sales of softwood lumber between 2011 and 2015 by 1.683 bbf or $596 million. This equates to a return on investment of $15.55 of additional sales for every $1 spent on promotion by the Board.23

    23 Prime Consulting, Softwood Lumber Board, Comprehensive Program ROI, 2012-2015, February 2016.

    Therefore, when considering all of the factors collectively, USDA has determined that a de minimis quantity of 15 mmbf would work better than the other thresholds reviewed. USDA concludes that 15 mmbf is a reasonable de minimis quantity under the softwood lumber Order. Accordingly, this proposed rule would establish the de minimis quantity threshold under the Order at 15 mmbf. Thus, USDA is not proposing any amendment to part 1217.

    Initial Regulatory Flexibility Act Analysis

    In accordance with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), AMS is required to examine the impact of this proposed rule on small entities as defined by the Small Business Administration (SBA). The classification of a business as small, as defined by the SBA, varies by industry. If a business is defined as “small” by SBA size standards, then it is “eligible for government programs and preferences reserved for `small business' concerns.” 24 Accordingly, AMS has considered the economic impact of this action on such entities.

    24https://www.sba.gov/contracting/getting-started-contractor/make-sure-you-meet-sba-size-standards/small-business-size-regulations.

    The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions so that small businesses will not be disproportionately burdened. The SBA defines, in 13 CFR part 121, small agricultural producers as those having annual receipts of no more than $750,000 and small agricultural service firms (domestic manufacturers and importers) as those having annual receipts of no more than $7.5 million.25

    25 SBA does have a small business size standard for “Sawmills” of 500 employees (see https://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf). Based on USDA's understanding of the lumber industry, using this criteria would be impractical as sawmills often use contractors rather than employees to operate and, therefore, many mills would fall under this criteria while being, in reality, a large business. Therefore, USDA used agricultural service firm as a more appropriate criteria for this analysis.

    Using an average price of $330 per thousand board feet, a domestic manufacturer or importer who ships less than about 23 mmbf per year would be considered a small entity for purposes of the RFA. As shown in Table 4, there were 1,054 domestic manufacturers and importers of softwood lumber based on 2015 data. Of these, 864 entities shipped or imported less than 23 mmbf and would be considered to be small entities under the SBA definition. Thus, based on the $7.5 million threshold, the majority of domestic manufacturers and importers of softwood lumber would be considered small entities for purposes of the RFA.

    This action proposes to establish a de minimis quantity exemption threshold under the Order. The Order is administered by the Board with oversight by USDA. In response to a federal district court decision in Resolute, USDA conducted a new analysis to determine a reasonable and appropriate de minimis threshold. Based on this analysis, this proposal would establish the de minimis quantity threshold at 15 mmbf and entities manufacturing (and domestically shipping) or importing less than 15 mmbf per year would be exempt from paying assessments under the Order. Authority for this action is provided in sections 516(a)(2), 516(g) and 525 of the 1996 Act.

    Regarding the economic impact of the de minimis exemption, the exemption allows the Board to exempt from assessment small entities that would be unduly burdened from the program's obligations. At the proposed exemption threshold, small manufacturers and importers that domestically ship or import less than 15 mmbf of softwood lumber would not have to pay assessments under the program.

    Additionally, larger manufacturers and importers would not have to pay assessments on the first 15 mmbf of softwood lumber domestically shipped or imported each year. This exemption is intended for the purpose of equity, whereby all entities who must pay assessments may reduce their assessable volume by 15 mmbf. This exemption benefits smaller manufacturers and importers whose annual shipments or imports are above the de minimis threshold of 15 mmbf. With this exemption, an entity that ships or imports a quantity of softwood lumber equal to the RFA-small business definition of 23 mmbf, for example, would only pay assessments on no more than 8 mmbf of softwood lumber.

    As previously stated, to calculate the impact of the assessment rate on the revenue of an assessment payer, the assessment rate is divided by an average price. Using an average 2015 price of $330 per thousand board feet, the assessment rate as a percentage of price could range from 0.106 percent at the current assessment rate to 0.151 percent at the maximum assessment rate. This analysis helps identify the impact of the assessment rate on the revenues of assessment payers. At the current assessment rate of $0.35 per thousand board feet to the maximum assessment rate of $0.50 per thousand board feet, assessment payers would owe between 0.106 percent and 0.151 percent of their revenues, respectively.

    In its analysis of alternatives, USDA evaluated five different exemption thresholds—30, 25, 20, 15 and 10 mmbf using 2015 data—accounting for both the de minimis and equity exemptions, as well as having no exemptions under the program. USDA evaluated these alternatives based on the following factors: An estimate of quantity of softwood lumber covered under the program (quantity assessed and quantity exempted); available funding to support a viable program; free rider implications; and the impact of program requirements on entities (above and below a de minimis threshold). USDA conducted a balancing test among these factors to assess whether one exemption threshold works better than another when the factors are considered collectively.

    In reviewing the quantity of assessable versus exempt softwood lumber at the alternative exemption thresholds, USDA found that at an exemption threshold of 30 mmbf, a total of 32.805 bbf would be assessed with 3.284 bbf, or 8 percent, exempt as de minimis, plus an additional 5.16 bbf exempt as equity for 20 percent of total volume exempt; at 25 mmbf, a total of 33.694 bbf would be assessed with 2.93 bbf, or 7 percent, exempt as de minimis, plus an additional 4.625 bbf exempt as equity for 18 percent total volume exempt; at a threshold of 20 mmbf, a total of 34.69 bbf would be assessed with 2.259 bbf, or 5 percent, exempt as de minimis, plus an additional 4.3 bbf exempt as equity for 16 percent total volume exempt; at a threshold of 15 mmbf, a total of 35.854 bbf would be assessed with 1.57 bbf, or 4 percent, exempt as de minimis, plus an additional 3.825 bbf exempt as equity for 13 percent total volume exempt; at a threshold of 10 mmbf, a total of 37.183 bbf would be assessed, with 1.236 bbf, or 3 percent, exempt as de minimis, plus an additional 2.83 bbf exempt as equity for 10 percent total volume exempt; and with no exemptions, a total of 41.249 bbf would be assessed. In reviewing the total volume exempt under the softwood lumber program (taking into account both the de minimis and equity exemptions), thresholds of 10 to 15 mmbf exempt between 10 and 13 percent of the volume, which is close to the range exempt under other programs.

    In reviewing available funding to support a viable program at the alternative exemption thresholds, at an exemption threshold of 30 mmbf, estimated assessment revenue is $11.482 million; at 25 mmbf, estimated assessment revenue is $11.793 million (an additional $311,243); at a threshold of 20 mmbf, estimated assessment revenue is $12.141 million (an additional $348,408); at a threshold of 15 mmbf, estimated assessment revenue is $12.549 million (an additional $407,444); at a threshold of 10 mmbf, estimated assessment revenue is $13.014 million (an additional $465,267); and with no exemptions, estimated assessment revenue is $14.437 million (an additional $1.423 million).

    Assessment revenue under the current softwood lumber program has ranged from about $10.638 million in 2012 to $12.905 million in 2015. At this level of revenue, the current program has seen success. The revenues reviewed at the different exemption thresholds are comparable to these levels or higher. Thus, all of the exemption thresholds analyzed would generate sufficient revenue for a viable program.

    Regarding free riders, USDA notes that the key to assessing the free rider implications of a de minimis quantity is not the number of entities exempt under a program but rather the volume of product exempt. This is because assessments are based on volume shipped or imported and not on the number of entities; assessments are not paid by entities on a pro rata basis. In evaluating free rider implications at the alternative exemption thresholds, at an exemption threshold of 30 mmbf, 84 percent of the number of entities (or 882) would be exempt but only 8 percent of the volume would be exempt as de minimis; at a threshold of 25 mmbf, 82 percent of the number of entities (or 869) would be exempt, but only 7 percent of the volume would be exempt as de minimis; at a threshold of 20 mmbf, 80 percent of the number of entities (or 839) would be exempt, but only 5 percent of the volume would be exempt as de minimis; at a threshold of 15 mmbf, 76 percent of the number of entities (or 799) would be exempt, but only 4 percent of the volume would be exempt as de minimis; and at a threshold of 10 mmbf, 73 percent of the number of entities (or 771) would be exempt, but only 3 percent of the volume would be exempt as de minimis.

    In evaluating the impact of the program's requirements at the alternative exemption thresholds, entities that ship or import at or above the de minimis threshold must pay assessments to the Board. Assessment payers must also submit a report to the Board each quarter of the volume of softwood lumber shipped or imported for the respective quarter. Entities that ship or import below the de minimis threshold must apply to the Board each year for a certificate of exemption and provide documentation as appropriate to support their request. The reporting and recordkeeping requirements are detailed in the section below titled Paperwork Reduction Act.

    At an exemption threshold of 30 mmbf, 172 entities would pay assessments and 882 would be exempt; at 25 mmbf, 185 entities would pay assessments and 869 would be exempt; at 20 mmbf, 215 entities would pay assessments and 839 would be exempt; at 15 mmbf, 255 entities would pay assessments and 799 would be exempt; at 10 mmbf, 283 entities would pay assessments and 771 would be exempt. Thus, as the exemption threshold is reduced, more entities would be subject to the Order's assessment and quarterly reporting obligation.

    Further, in considering program compliance costs, USDA estimates the cost of an on-site audit of a single entity at $5,000 or more. Thus, the cost to pursue a compliance case against an entity that shipped less than 10 mmbf, 9 mmbf for example, would outweigh the revenue that would be collected from that entity of $3,150. Similarly, the assessment revenue that would be collected from an entity that shipped less than 15 mmbf, 12 mmbf for example, would amount to $4,200. The benefit of assessing smaller manufacturers, $3,150 at 9 mmbf and $4,200 at 12 mmbf, does not outweigh the cost of pursuing compliance cases against them at $5,000 per entity. The point at which the assessment revenue that would be collected from an entity outweighs the estimated cost of $5,000 to pursue a compliance case is an entity with volume equal to or greater than 14.3 mmbf.26 This level is close to 15 mmbf. By this analysis, the selection of 15 mmbf as the de minimis quantity is reasonable.

    26 This figure is computed by dividing the estimated cost to pursue a compliance case against an entity of $5,000 by the assessment rate of $0.35 per thousand board feet.

    Analysis of the 23 mmbf-RFA small business threshold as a reasonable option for de minimis shows that 190 entities would be subject to assessment and 864 entities would be exempt. In terms of volume, 38.44 bbf would be assessed, or 93 percent of total volume, and 2.809 bbf would be exempt, or 7 percent of total volume.

    Based upon the analysis contained herein, any of the exemption threshold reviewed would be reasonable because they would exempt from 3 to 8 percent of the volume of softwood lumber as de minimis. However, when the total volume exempt under the softwood lumber program is considered (taking into account both the de minimis and equity exemptions), thresholds of 10 to 15 mmbf exempt between 10 and 13 percent of the volume, which is close to the range exempt under other programs. While all of the exemption thresholds would generate sufficient revenue for a viable program, the additional revenue that could be collected if the de minimis level were reduced much lower than 15 mmbf would likely not be worth the additional costs. The softwood lumber program operated successfully since its inception at an exemption threshold of 15 mmbf.27

    27 An independent evaluation of the softwood lumber program showed that the activities of the Board increased sales of softwood lumber between 2011 and 2015 by 1.683 bbf or $596 million. This equates to a return on investment of $15.55 of additional sales for every $1 spent on promotion by the Board. By this metric, the Order to-date has been effective. USDA therefore finds that 15 mmbf is a reasonable exemption level for de minimis.

    Paperwork Reduction Act

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

    As previously mentioned, pursuant to section 1217.53(a) of the Order, domestic manufacturers and importers who domestically ship or import less than the de minimis threshold must apply to the Board each year for a certificate of exemption and provide documentation as appropriate to support their request. The reporting burden for this collection of information is estimated to average 0.25 hours per domestic manufacturer or importer per report, or 0.25 hours per year (1 request per year per exempt entity). This computes to a total annual burden of 199.75 hours (0.25 hours times 799 exempt entities at the 15 mmbf de minimis exemption threshold from Table 4).

    Further, pursuant to section 1217.70 of the Order, domestic manufacturers and importers that ship or import at or over the de minimis exemption level and pay their assessments directly to the Board must submit a shipment/import report for each quarter when assessments are due. The reporting burden for this collection of information is estimated to average 0.5 hours per domestic manufacturer or importer per report, or 2 hours per year (4 reports per year times 0.5 hours per report). This computes to a total annual burden of 510 hours (255 assessed entities (from Table 4—No. of Assessed Entities at 15 mmbf) at 2 hours each equals 510 hours).

    All domestic manufacturers and importers must also maintain records sufficient to verify their reports. The recordkeeping burden for keeping this information is estimated to average 0.5 hours per record keeper maintaining such records, or 527 hours (1,054 total entities assessed (from Table 4—No. of Assessed Entities at no exemption) times 0.5 hours).

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

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

    Regarding outreach efforts, USDA initiated this action in response to a May 2016 federal court decision in Resolute. USDA proposes to establish the de minimis quantity exemption under the softwood lumber Order as contained herein.

    We have performed this initial RFA analysis regarding the impact of the proposed action on small entities and we invite comments concerning the potential effects of this action.

    USDA has determined that this proposed rule is consistent with and would effectuate the purposes of the 1996 Act.

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

    List of Subjects in 7 CFR Part 1217

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

    The authority citation for 7 CFR part 1217 continues to read as follows:

    Authority:

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

    Dated: May 23, 2017. Bruce Summers, Acting Administrator.
    [FR Doc. 2017-10997 Filed 5-26-17; 8:45 am] BILLING CODE 3410-02-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0499; Directorate Identifier 2016-NM-205-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain The Boeing Company Model 747-400, 747-400F, and 747-8F series airplanes. This proposed AD was prompted by reports of failure of the fastener assemblies on the crew access ladder handrails. This proposed AD would require replacing the fastener assemblies. We are proposing this AD to address the unsafe condition on these products.

    DATES:

    We must receive comments on this proposed AD by July 14, 2017.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1717; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0499.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0499; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Susan L. Monroe, Aerospace Engineer, Cabin Safety and Environmental Systems Branch, ANM-150S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA; phone: 425-917-6457; fax: 425-917-6590; email: [email protected]

    SUPPLEMENTARY INFORMATION: Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2017-0499; Directorate Identifier 2016-NM-205-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

    Discussion

    We have received reports of failure of the fastener assemblies on the crew access ladder handrails. Bolts on existing fastener assemblies for the crew ladder handrail are too short to ensure self-locking nut elements are fully engaged. This condition, if not corrected, could result in the fastener assemblies on the crew access ladder handrails coming loose, which could result in serious or fatal injury to personnel.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Special Attention Service Bulletin 747-25-3693, dated November 10, 2016. The service information describes procedures for replacing the existing fastener assemblies with new assemblies on the crew access ladder handrails. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

    We are proposing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously, except as discussed under “Differences Between this Proposed AD and the Service Information.” For information on the procedures, see this service information at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0499.

    Differences Between This Proposed AD and the Service Information

    Boeing Special Attention Service Bulletin, 747-25-3693, dated November 10, 2016, applies to certain The Boeing Company Model 747-400, 747-400F, and 747-8F series airplanes. This proposed AD would apply to those airplanes and all Model 747-8F airplanes with an original certificate of airworthiness, or an original export certificate of airworthiness, issued after November 10, 2016. Because the affected parts are rotable parts, we have determined that these parts could later be installed on airplanes that were initially delivered with acceptable parts, thereby subjecting those airplanes to the unsafe condition. We have coordinated this difference with Boeing.

    Costs of Compliance

    We estimate that this proposed AD affects 84 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S. operators
    Replacement 3 work-hours × $85 per hour = $255 $2,418 $2,673 $224,532

    According to the manufacturer, some of the costs of this proposed AD may be covered under warranty, thereby reducing the cost impact on affected individuals. We do not control warranty coverage for affected individuals. As a result, we have included all costs in our cost estimate.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): The Boeing Company: Docket No. FAA-2017-0499; Directorate Identifier 2016-NM-205-AD. (a) Comments Due Date

    We must receive comments by July 14, 2017.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to The Boeing Company airplanes identified in paragraphs (c)(1), (c)(2), and (c)(3) of this AD, certificated in any category.

    (1) Model 747-400, 747-400F, and 747-8F series airplanes, as identified in Boeing Special Attention Service Bulletin 747-25-3693, dated November 10, 2016.

    (2) Model 747-8F series airplanes with an original certificate of airworthiness, or an original export certificate of airworthiness, issued after November 10, 2016, and before the effective date of this AD.

    (3) Model 747-8F series airplanes with an original certificate of airworthiness, or an original export certificate of airworthiness, issued on or after the effective date of this AD.

    (d) Subject

    Air Transport Association (ATA) of America Code 25; Equipment/furnishings.

    (e) Unsafe Condition

    This AD was prompted by reports of failure of the fastener assemblies on the crew access ladder handrails. We are issuing this AD to prevent the fastener assemblies from coming loose on the crew access ladder handrails, which could result in serious or fatal injury to personnel.

    (f) Compliance

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

    (g) Replacement

    For airplanes identified in paragraph (c)(1) of this AD: Within 36 months after the effective date of this AD, replace the fastener assemblies in the crew access ladder handrails with new fastener assemblies, in accordance with the Accomplishment Instructions of Boeing Special Attention Service Bulletin 747-25-3693, dated November 10, 2016.

    (h) Inspection and Replacement

    (1) For airplanes identified in paragraph (c)(2) of this AD: Within 36 months after the effective date of this AD, do a general visual inspection of the crew access ladder handrails for the discrepant fastener assembly hardware identified in the Accomplishment Instructions of Boeing Special Attention Service Bulletin 747-25-3693, dated November 10, 2016. A review of airplane maintenance records is acceptable in lieu of this inspection, if the part number(s) of the fastener assembly hardware can be conclusively determined from that review.

    (2) If any discrepant fastener assembly hardware is found, within 36 months after the effective date of this AD, replace the discrepant fastener assemblies in the crew access ladder handrails with new fastener assemblies, in accordance with the Accomplishment Instructions of Boeing Special Attention Service Bulletin 747-25-3693, dated November 10, 2016.

    (i) Parts Installation Limitation

    For airplanes identified in paragraphs (c)(1), (c)(2), and (c)(3) of this AD: As of the effective date of this AD, no person may install the discrepant fastener hardware identified in the Accomplishment Instructions of Boeing Special Attention Service Bulletin 747-25-3693, dated November 10, 2016, on a crew access ladder on any airplane.

    (j) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (k)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Seattle ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (4) For service information that contains steps that are labeled as Required for Compliance (RC), the provisions of paragraphs (j)(4)(i) and (j)(4)(ii) of this AD apply.

    (i) The steps labeled as RC, including substeps under an RC step and any figures identified in an RC step, must be done to comply with the AD. If a step or substep is labeled “RC Exempt,” then the RC requirement is removed from that step or substep. An AMOC is required for any deviations to RC steps, including substeps and identified figures.

    (ii) Steps not labeled as RC may be deviated from using accepted methods in accordance with the operator's maintenance or inspection program without obtaining approval of an AMOC, provided the RC steps, including substeps and identified figures, can still be done as specified, and the airplane can be put back in an airworthy condition.

    (k) Related Information

    (1) For more information about this AD, contact Susan L. Monroe, Aerospace Engineer, Cabin Safety and Environmental Systems Branch, ANM-150S, FAA, Seattle ACO, 1601 Lind Avenue SW., Renton, WA; phone: 425-917-6457; fax: 425-917-6590; email: [email protected]

    (2) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740-5600; telephone 562-797-1717; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on May 17, 2017. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10606 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0500; Directorate Identifier 2017-NM-009-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain The Boeing Company Model MD-11 and MD-11F airplanes. This proposed AD was prompted by fuel system reviews conducted by the manufacturer. This proposed AD would require a one-time inspection of the wire assemblies of the tail fuel tank transfer pumps to determine if metallic transitions are installed at the wire harness breakouts, and corrective actions if necessary. We are proposing this AD to address the unsafe condition on these products.

    DATES:

    We must receive comments on this proposed AD by July 14, 2017.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740; telephone 562-797-1717; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0500.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0500; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Sérj Harutunian, Aerospace Engineer, Propulsion Branch, ANM-140L, FAA, Los Angeles Aircraft Certification Office (ACO), 3960 Paramount Boulevard, Lakewood, California 90712-4137; phone: 562-627-5254; fax: 562-627-5210; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2017-0500; Directorate Identifier 2017-NM-009-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD because of those comments.

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

    Discussion

    The FAA has examined the underlying safety issues involved in fuel tank explosions on several large transport airplanes, including the adequacy of existing regulations, the service history of airplanes subject to those regulations, and existing maintenance practices for fuel tank systems. As a result of those findings, we issued a final rule titled “Transport Airplane Fuel Tank System Design Review, Flammability Reduction, and Maintenance and Inspection Requirements” (66 FR 23086, May 7, 2001). In addition to new airworthiness standards for transport airplanes and new maintenance requirements that rule included Amendment 21-78, which established Special Federal Aviation Regulation No. 88 (“SFAR 88”) at 14 CFR part 21. Subsequently, SFAR 88 was amended by: Amendment 21-82 (67 FR 57490, September 10, 2002; corrected at 67 FR 70809, November 26, 2002) and Amendment 21-83 (67 FR 72830, December 9, 2002; corrected at 68 FR 37735, June 25, 2003, to change “21-82” to “21-83”).

    Among other actions, SFAR 88 requires certain type design (i.e., type certificate (TC) and supplemental type certificate (STC)) holders to substantiate that their fuel tank systems can prevent ignition sources in the fuel tanks. This requirement applies to type design holders for large turbine-powered transport airplanes and for subsequent modifications to those airplanes. It requires them to perform design reviews and to develop design changes and maintenance procedures if their designs do not meet the new fuel tank safety standards. As explained in the preamble to the rule, we intended to adopt airworthiness directives to mandate any changes found necessary to address unsafe conditions identified as a result of these reviews.

    In evaluating these design reviews, we have established four criteria intended to define the unsafe conditions associated with fuel tank systems that require corrective actions. The percentage of operating time during which fuel tanks are exposed to flammable conditions is one of these criteria. The other three criteria address the failure types under evaluation: Single failures, combination of failures, and unacceptable (failure) experience. For all three failure criteria, the evaluations included consideration of previous actions taken that may mitigate the need for further action.

    This proposed AD was prompted by fuel system reviews conducted by the manufacturer. In addition, during one event on a Model MD-11 airplane that occurred during flight, a level 1 message “TAIL L PUMP OFF” was annunciated; investigation of the wire bundles in the horizontal stabilizer next to the tail fuel tank revealed burned and broken wires, which showed severe signs of overheating and arcing. This is considered a quality control issue because the type design harnesses were not installed properly during the required SFAR 88 modifications.

    We are proposing this AD to detect and correct potential ignition sources inside the tail fuel tank, which, in combination with flammable vapors, could result in a fuel tank fire or explosion, and consequent loss of the airplane.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016. The service information describes procedures for a one-time detailed inspection of the wire assemblies of the tail fuel tank transfer pumps to determine if metallic transitions are installed at the wire harness breakouts, and corrective actions that include repair and replacement of the wire assembly. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    Related Rulemaking

    On May 14, 2010, we issued AD 2010-11-12, Amendment 39-16317 (75 FR 30274, June 1, 2010) (“AD 2010-11-12”), for certain Model MD-11 and MD-11F airplanes. AD 2010-11-12 requires a one-time inspection to determine if metallic transitions are installed on wire harnesses of the tail fuel tank transfer pumps, and to inspect for and repair damaged wires. AD 2010-11-12 also requires repetitive inspections of repaired areas; and a permanent modification of the wire harnesses if metallic transitions are not installed, which would terminate the repetitive inspections. AD 2010-11-12 also requires modifying the case grounding for the alternate fuel pump of the tail fuel tank, the leak detection thermal switch grounding for the number 2 engine, and wire braid grounding in the empennage and number 2 engine inlet. We issued AD 2010-11-12 to prevent insufficient grounding of the fuel pump, which, in combination with an electrical failure within the fuel pump and a compromised electrical bond, could cause a fuel tank ignition, resulting in consequent fire or explosion.

    On January 3, 2011, we issued AD 2011-02-01, Amendment 39-16574 (76 FR 1983, January 12, 2011) (“AD 2011-02-01”), for certain Model MD-11 and MD-11F airplanes. AD 2011-02-01 requires a one-time inspection to detect damage of the wire assemblies of the tail fuel tank fuel system, a wiring change, and corrective actions if necessary. AD 2011-02-01 also requires, for certain airplanes, a general visual inspection for correct installation of the self-adhering high-temperature electrical insulation tape; installation of a wire assembly support bracket and routing wire assembly; changing of certain wire supports; and installation of a wire protection bracket. We issued AD 2011-02-01 to detect and correct a potential of ignition sources inside fuel tanks, which, in combination with flammable vapors, could result in a fuel tank fire or explosion, and consequent loss of the airplane.

    This proposed AD would not supersede or terminate the actions required by AD 2010-11-12 and AD 2011-02-01. Certain airplanes identified in the related rulemaking may not have the correct wire harness with metallic transitions installed; therefore this proposed AD would address the unsafe condition on those airplanes.

    FAA's Determination

    We are proposing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously.

    The phrase “corrective actions” is used in this proposed AD. “Corrective actions” are actions that correct or address any condition found. Corrective actions in an AD could include, for example, repairs.

    Costs of Compliance

    We estimate that this proposed AD affects 110 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S. operators
    Inspection 4 work-hours × $85 per hour = $340 $0 $340 $37,400

    We estimate the following costs to do any necessary repairs/replacements that would be required based on the results of the proposed inspection. We have no way of determining the number of aircraft that might need these repairs/replacements:

    On-Condition Costs Action Labor cost Parts cost Cost per
  • product
  • Repair 9 work-hours × $85 per hour = $765 $0 $765 Replacement 16 work-hours × $85 per hour = $1,360 57,526 58,886
    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): The Boeing Company: Docket No. FAA-2017-0500; Directorate Identifier 2017-NM-009-AD. (a) Comments Due Date

    We must receive comments by July 14, 2017.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to the Boeing Company Model MD-11 and MD-11F airplanes, certificated in any category, as identified in Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016.

    (d) Subject

    Air Transport Association (ATA) of America Code 28; Fuel.

    (e) Unsafe Condition

    This AD was prompted by fuel system reviews conducted by the manufacturer. We are issuing this AD to detect and correct potential ignition sources inside the tail fuel tank, which, in combination with flammable vapors, could result in a fuel tank fire or explosion, and consequent loss of the airplane.

    (f) Compliance

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

    (g) One-Time Inspection and Corrective Actions

    Within 27 months after the effective date of this AD: Do a one-time detailed inspection of the wire assemblies of the tail fuel tank transfer pumps to determine if metallic transitions are installed at the wire harness breakouts, in accordance with the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016. If metallic transitions are installed, no further action is required by this paragraph. If metallic transitions are not installed, do the corrective actions required by paragraphs (g)(1) and (g)(2) of this AD, as applicable, except as required by paragraphs (h)(1), (h)(2), and (h)(3) of this AD.

    (1) Repair any affected wire assembly before further flight, in accordance with Part 2 of the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016, or replace any affected wire assembly with a new assembly before further flight, in accordance with Part 3 of the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016. If the replacement is done, no further action is required for that wire assembly only.

    (2) Within 24 months after accomplishment of the repair required by paragraph (g)(1) of this AD: Replace any repaired wire assembly with a new assembly, in accordance with Part 3 of the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016.

    (h) Service Information Exceptions

    (1) Where Part 4.1.f. of the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016, specifies “CONTROLLER FUEL SYSTEM—ADJUSTMENT/TEST refer to MD-11, AMM (Airplane Maintenance Manual) 28-28-01 as an accepted procedure”: Adjust and test the controller fuel system. If the test fails do corrective actions, repeat the test, and do applicable corrective actions until the system passes the test.

    (2) Where Part 4.1.g. of the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016, specifies “OPERATIONAL TEST OF THE FILL SHUTOFF VALVE CONTROLLER refer to MD-11 AMM 26-21—02, as an accepted procedure”: Do the operational test of the part. If the part fails the test, do corrective actions, repeat the test, and do applicable corrective actions until the part passes the test.

    (3) Where Part 4.1.h. of the Accomplishment Instructions of Boeing Alert Service Bulletin MD11-28A150, dated October 6, 2016, specifies “SWITCH, PUMP LOW PRESSURE—ADJUSTMENT/TEST, refer to MD-11 AMM 28-44-01, as an accepted procedure”: Do the operational test of the part. If the part fails the test, do corrective actions, repeat the test, and do applicable corrective actions until the part passes the test.

    (i) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Los Angeles Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (j)(1) of this AD. Information may be emailed to: [email protected]

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Los Angeles ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (4) For service information that contains steps that are labeled as Required for Compliance (RC), the provisions of paragraphs (i)(4)(i) and (i)(4)(ii) of this AD apply.

    (i) The steps labeled as RC, including substeps under an RC step and any figures identified in an RC step, must be done to comply with the AD. If a step or substep is labeled “RC Exempt,” then the RC requirement is removed from that step or substep. An AMOC is required for any deviations to RC steps, including substeps and identified figures.

    (ii) Steps not labeled as RC may be deviated from using accepted methods in accordance with the operator's maintenance or inspection program without obtaining approval of an AMOC, provided the RC steps, including substeps and identified figures, can still be done as specified, and the airplane can be put back in an airworthy condition.

    (j) Related Information

    (1) For more information about this AD, contact Sérj Harutunian, Aerospace Engineer, Propulsion Branch, ANM-140L, FAA, Los Angeles ACO, 3960 Paramount Boulevard, Lakewood, California 90712-4137; phone: 562-627-5254; fax: 562-627-5210; email: [email protected]

    (2) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Contractual & Data Services (C&DS), 2600 Westminster Blvd., MC 110-SK57, Seal Beach, CA 90740; telephone 562-797-1717; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on May 17, 2017. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2017-10604 Filed 5-26-17; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2017-0497; Directorate Identifier 2016-NM-209-AD] RIN 2120-AA64 Airworthiness Directives; Airbus Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for all Airbus Model A300 series airplanes. This proposed AD was prompted by a report of reduction of the de-icing performance of the pitot probe over time that could remain hidden to the flight crew. This proposed AD would require repetitive detailed inspections of the pitot probe heater insulation resistance, and replacement of the pitot probe heater if necessary. We are proposing this AD to address the unsafe condition on these products.

    DATES:

    We must receive comments on this proposed AD by July 14, 2017.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Airbus SAS, Airworthiness Office—EAW, 1 Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France; telephone: +33 5 61 93 36 96; fax: +33 5 61 93 44 51; email: [email protected]; Internet: http://www.airbus.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0497; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Dan Rodina, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone: 425-227-2125; fax: 425-227-1149.

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposed AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2017-0497; Directorate Identifier 2016-NM-209-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed AD based on those comments.

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

    Discussion

    The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA AD 2016-0248, dated December 15, 2016 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus Model A300 series airplanes. The MCAI states:

    An operator reported a reduction of the de-icing performance of the pitot probe over the time. Pitot probes are heated to prevent ice accretion. De-icing performances of the Pitot probe might be reduced if Pitot probe heater degrades over time. Investigation results highlighted that the magnitude of de-icing performance reduction depended on how much the [pitot probe] heater is degraded. This degradation could remain hidden to the crew.

    Pitot probes heater degradation, if not detected and corrected, could lead to unreliable airspeed indications, possibly resulting in reduced control of the aeroplane.

    To ensure nominal de-icing performances of the Pitot probe, Airbus developed an inspection process to check the pitot [probe] heater performance, and published Service Bulletin (SB) A300-34-0185 to provide the necessary instructions to operators.

    For the reasons described above, this [EASA] AD requires repetitive detailed inspections (DET) of the pitot [probe] heater, and, depending on findings, replacement with a serviceable one.

    You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2017-0497.

    Related Service Information Under 1 CFR Part 51

    We reviewed Airbus Service Bulletin A300-34-0185, Revision 00, dated August 29, 2016. The service information describes procedures for repetitive detailed inspections of the pitot probe heater insulation resistance and replacement of the pitot probe heater. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination and Requirements of This Proposed AD

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

    Costs of Compliance

    We estimate that this proposed AD affects 5 airplanes of U.S. registry.

    We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S.
  • operators
  • Repetitive inspection 5 work-hours × $85 per hour = $425 per inspection cycle. $0 $425 per inspection cycle $2,125 per inspection cycle. Reporting 1 work hour × $85 per hour = $85 0 $85 $425 per inspection cycle.

    We estimate the following costs to do any necessary replacements that would be required based on the results of the proposed inspection. We have no way of determining the number of aircraft that might need this replacement:

    On-Condition Costs Action Labor cost Parts cost Cost per
  • product
  • Replacement 3 work-hours × $85 per hour = $255 $9,015 $9,270
    Paperwork Reduction Act

    A federal agency may not conduct or sponsor, and a person is not required to respond to, nor shall a person be subject to penalty for failure to comply with a collection of information subject to the requirements of the Paperwork Reduction Act unless that collection of information displays a current valid OMB control number. The control number for the collection of information required by this proposed AD is 2120-0056. The paperwork cost associated with this proposed AD has been detailed in the Costs of Compliance section of this document and includes time for reviewing instructions, as well as completing and reviewing the collection of information. Therefore, all reporting associated with this proposed AD is mandatory. Comments concerning the accuracy of this burden and suggestions for reducing the burden should be directed to the FAA at 800 Independence Ave. SW., Washington, DC 20591, ATTN: Information Collection Clearance Officer, AES-200.

    Authority for This Rulemaking

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

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

    Regulatory Findings

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

    For the reasons discussed above, I certify this proposed regulation:

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

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

    3. Will not affect intrastate aviation in Alaska; and

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

    List of Subjects in 14 CFR Part 39

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

    The Proposed Amendment

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

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

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

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Airbus: Docket No. FAA-2017-0497; Directorate Identifier 2016-NM-209-AD. (a) Comments Due Date

    We must receive comments by July 14, 2017.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to Airbus Model A300 B2-1A, B2-1C, B2K-3C, B2-203, B4-2C, B4-103, and B4-203 airplanes, certificated in any category, all manufacturer serial numbers.

    (d) Subject

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

    (e) Reason

    This AD was prompted by a report of reduction of the de-icing performance of the pitot probe over time that could remain hidden to the flight crew. We are issuing this AD to ensure nominal de-icing performance of the pitot probe in order to prevent unreliable airspeed indications, which could result in reduced control of the airplane.

    (f) Compliance

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

    (g) Definition of Pitot Probes

    For the purpose of this AD, affected pitot probes are the First Officer's Pitot Probe 40DA, Captain's Pitot Probe 41DA, and Standby Pitot Probe 42DA.

    (h) Repetitive Inspections

    At the time specified in paragraph (h)(1) or (h)(2) of this AD, whichever occurs later, do a detailed inspection of the pitot probe heater insulation resistance on each affected pitot probe, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A300-34-0185, Revision 00, dated August 29, 2016. Repeat the inspection thereafter at intervals not to exceed 24 months.

    (1) Within 24 months since the last detailed inspection of the pitot probe heater insulation resistance, as specified in Airbus A300 Aircraft Maintenance Manual (AMM), Task 30-31-00.

    (2) Within 6 months after the effective date of this AD.

    (i) Corrective Action

    If, during any detailed inspection as required by paragraph (h) of this AD, any pitot probe fails the test, as specified in the Accomplishment Instructions of Airbus Service Bulletin A300-34-0185, Revision 00, dated August 29, 2016, before further flight, replace the affected pitot probe with a serviceable (new or inspected as required by this AD) pitot probe, in accordance with the Acc